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Accommodation
The property has been measured by BKR Floor Plans and provides the following Net Internal Areas;
| Systems Integration | ||
| Part Ground Floor | 607.75 sq m | 6,542 sq ft |
| Vacant Accommodation | ||
| Part Ground Floor | 316.14 sq m | 3,403 sq ft |
| First Floor | 944.33 sq m | 10,165 sq ft |
| Sub-Total | 1,260.47 sq m | 13,568 sq ft |
| TOTAL | 1,868.22 sq m | 20,110 sq ft |
A set of floor plans is available to download and the measured survey report will be re-addressed to a purchaser at a cost of £675 + VAT.
Rateable Value
We understand the rateable value for the property is as follows:
| Accommodation | Rateable Value |
| Part Ground Floor – Systems Integration | £55,500 |
| Part Ground and First Floor – Vacant | £100,000 |
The Uniform Business Rate is 49.9 pence per pound.
Site
We estimate the site area to be approximately 0.57 hectares (1.41 acres).
Tenure
Long leasehold for a term of 125 years from 8th February 1991 (approximately 93 years unexpired) at a current ground rent of £6,000 per annum.
There are five yearly rent reviews, the next being on 7th February 2026, to the higher of the rent contractually payable immediately before the rent review date or 2.5% of the open market rent of the building.
Tenancy
The part ground floor is let to Systems Integration (Trading) Limited on a full repairing and insuring lease for a term of 5 years from 28th March 2023, expiring on 27th March 2028. There is a tenant’s break option on 28th March 2026, subject to six months’ notice. The annual rent is £72,000 per annum (£118.47 per sq m / £11.00 per sq ft).
The tenant is paying half rent (£36,000) for the first six months of the term. The vendor will “top-up” the income by an appropriate adjustment on the completion sum in order that a purchaser does not suffer an income shortfall.
The tenant has been in occupation since 2011 (originally in one unit and then taking additional space in 2017) and has recently signed a new lease, demonstrating their continued commitment to the property.
The part ground and first floor is currently vacant and on the market at a quoting rent of £162,816 per annum – £129 per sq m / £12.00 per sq ft. The vendor will provide a 12 month rates and service charge guarantee.
Service Charge
For the year ending June 2022 the Service Charge Expenditure for the whole building excluding electricity and gas was £20,918. The Service Charge Expenditure including the cost of electricity and gas totalled £71,857. The Service Charge Accounts and Service Charge Budget are available to download.
The ground floor tenant, Systems Integration (Trading) Limited, has a service charge cap of £22,060 per annum (excluding utilities costs). The tenant is separately recharged the additional costs of electricity and gas consumption.
In accordance with a side letter, Systems Integration is to pay 80% of the utilities cost of the building whilst they are the only tenant. Please refer to the data room.
Covenant
Systems Integration (Trading) Limited (Co. No. 02918365) has reported the following figures:
| 8 months | 12 months | |
| 31st December 2021 | 30th April 2021 | |
| Turnover | £4,539,691 | £6,149,860 |
| Pre-Tax Profits | £794,620 | £1,082,490 |
| Net Assets | £4,074,587 | £3,527,670 |
Founded in 1991 and headquartered in Staffordshire, Systems Integration (Trading) Limited is a leading provider of enterprise resource planning (ERP), and shop floor data capture solutions to the UK food processing industry.
In December 2021, the company was acquired by Aptean.
Aptean is one of the world’s leading providers of purpose-built, industry-specific software that helps manufacturers and distributors effectively run and grow their businesses. With both cloud and on-premise deployment options, Aptean’s products, services and expertise help businesses of all sizes. Headquartered in Georgia and with offices in North America, Europe and Asia-Pacific, Aptean employs over 3,500 people with over 10,000 customers in more than 20 industries in over 80 countries. For further information visit www.aptean.com.
VAT
The property has been registered for VAT and the Beneficial Owner has opted to tax. It is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).
Estimated Rental Value
The part ground floor has recently been let at £118 per sq m / £11.00 per sq ft. Applying a rate of £108 per sq m / £10.00 per sq ft to the vacant part ground and first floor accommodation, the estimated rental value for the building following re-letting is £207,680 per annum.
Proposal
Guide price £750,000 (Seven Hundred and Fifty Thousand Pounds), subject to contract, reflecting a capital value of £401 per sq m / £37 per sq ft and an estimated reversionary yield of 26% upon letting of the vacant accommodation.
Please note that a purchaser will be re-charged the costs of the searches (£2,454.76) and measured survey (£675 plus VAT) which are provided in the data room.
Please note that a purchaser will be charged a Transaction Fee of £5,000 + VAT.
Investment Considerations
An attractive office opportunity suitable for investors and owner-occupiers;
The property is situated in an established commercial location adjoining Fradley Park and the A38;
The part ground floor is let on a new lease from March 2023;
Part ground and first floor vacant with vendor to provide a 12 month business rates and service charge guarantee;
It is suggested that the site has future redevelopment potential, subject to consents, with alternative uses including industrial/warehouse accommodation;
A very low capital value of £401 per sq m / £37 per sq ft;
