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Accommodation
The property has been measured by BKR Floorplans and provides the following accommodation:
| Gross Frontage | 40 ft | 12.19 metres |
| Net Frontage | 41 ft 3 inches | 12.57 metres |
| Ground Floor GIA | 2,469 sq ft | 229.37 sq m |
| Ground Floor NIA | 2,382 sq ft | 221.29 sq m |
| ITZA | 1386.25 |
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 £540 + VAT.
EPC
The property has an EPC rating of ‘B’ valid until 28th January 2030.
Rateable Value
According to the valuation office website the rateable value for the property is £26,250
The business rates multiplier is 49.9 pence.
Tenure
Freehold [note the sale also includes a 999 year leasehold interest (virtual freehold) which the Buyer buys the Freehold subject to]
Tenancy
The property is let to One Stop Stores Limited on a full repairing and insuring lease, subject to a Schedule of Condition, for a term of 15 years from 4th February 2019, expiring 3rd February 2034. The current rent is £25,000 per annum and there is an upwards only open market rent review on 4th February 2029.
The tenant had a break option in February 2024 which was not exercised, demonstrating the tenant’s commitment to this location. There is a further break option on 4th February 2029, subject to six months’ written notice.
The lease provides that the tenant has a pre-emption right when marketing to acquire the freehold and submit a proposal for consideration. However, the tenant has confirmed that they have no interest in acquiring the freehold.
It should be noted that the lease provides that any defect which makes the property unfit for occupation or unfit for use, the tenant can suspend paying rent. The landlord must rectify at its own cost or may elect not to rectify. Note that the defects are defined in the agreement for lease, but the agreement is not available. However, we are unaware of any building issues which could give rise to a landlord’s expense.
The lease provides that where the landlord is required to undertake “Exceptional Works” which go beyond typical services, whilst the tenant is One Stop the cost is not to exceed £5,300 + VAT and the tenant is responsible for half.
Covenant
One Stop Stores Limited (Company Number: 02462858) has reported the following figures:
| Year Ending | 24 February 2024 | 24 February 2023 |
| Revenue | £1,297,600,000 | £1,171,300,000 |
| Pre-Tax Profits | £22,100,000 | £15,400,000 |
| Net Assets | £163,630,000 | £54,416,000 |
One Stop Stores Limited is a wholly owned subsidiary of Tesco PLC, it is a retail convenience business which currently has over 1000 retail stores throughout England and Wales. The convenience stores are open seven days a week providing a range of products from newspapers, groceries and alcohol in addition to cash withdrawals, National Lottery and Post Office services.
VAT
This property has been registered for VAT. It is anticipated that the sale will be treated as a transfer of a Going Concern (TOGC).
Proposal
We are instructed to seek £270,000 (Two Hundred and Seventy Thousand Pounds), subject to contract, reflecting an attractive net initial yield of 9.0% (allowing for purchaser’s costs at 2.91%).
Please note that a purchaser will be re-charged the costs of the measured survey (£540.00 +VAT) and searches (£2,459.80 inc VAT) which are provided in the data room.
Investment Considerations
Opportunity to acquire a freehold convenience store investment;
Strong covenant to One Stop Stores a wholly owned subsidiary of Tesco PLC;
Over 8 years unexpired lease term;
2024 break option not exercised, demonstrating the tenant’s commitment to this location;
The property benefits from being in a densely populated residential area;
A purchase at the asking price represents an attractive net initial yield;
Attractive lot size for investors.
Disclaimer
Fixed Charge Receivers Andrew Pear and Milan Vuceljic by the powers given by the Mortgage and all other powers given by statute or otherwise who act as agents for the Company and without personal liability. Both Fixed Charge Receivers are licenced by the Insolvency Practitioners Association and are bound by the Insolvency Code of Ethics.
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