-       Freehold commercial investment

-       Attractive unbroken period building

-       Prominent position in affluent suburb

-       Entirely let to Barclays Bank Plc until 2027

-       Passing rent £51,000 pax

-       OIRO £1.1m (4.38% NIY)

*Freehold commercial investment

*Attractive building in popular London suburb

*Entirely let to Barclays Bank plc until 2027

*Passing Rent £51,000 per annum exclusive

Description

A rare opportunity to acquire an attractive period freehold property in the highly sought after suburb of Blackheath, entirely let to Barclays Bank Plc. Prominently positioned opposite Blackheath Station in the heart of the Village, the property acts as a local landmark and would grace the portfolio of any private, corporate or institutional investor. The building is arranged over basement and four upper floors, with the bank predominantly contained over the lower two levels. At the time of our last internal inspection the first floor was utilised for storage, staff meeting rooms and welfare, with the upper two floors apparently disused for many years.

Location

The subject property is positioned on the corner of Tranquil Vale B2212 and Blackheath Grove in the very heart of Blackheath Village. The A2 and A20 are both within 1 mile offering easy access both in and out of London. Blackheath Station serves a high volume of commuters into London Bridge and Charing Cross, with direct services taking as little as 12 minutes. Blackheath is an affluent and highly sought after suburb of South East London. It’s proximity to Central London, Docklands and Canary Wharf, the abundance of attractive, historic buildings and open expanses of the famous Heath and Greenwich Park make the immediate area a convenient urban oasis.

Accommodation

Given that the property is entirely occupied by Barclays and serves as a busy local bank, opportunities to inspect during our client’s ownership have been limited. We have not measured the property, but according to Valuation Office Agency records the total area is approx 2,616 sqft (243sqm). Furthermore, VOA records note areas of 304 sqft, 300 sqft and 165 sqft for Retail Zones A, B & C respectively.

Lease Terms

The entire property is let on FRI terms to Barclays Bank Plc for a period of 20 years from 25th April 2007. A break is available to the tenant at the end of the 15th year upon receipt of 6 months prior written notice. The lease provides for upward only market rent reviews on 24th June 2016 and 2021. Whilst reviewed, the rent was not increased on 24th June 2011, and as such the passing rent remains at the initial level of £51,000pax.

Covenant

For the year ending 31st December 2011, Barclays Bank Plc announced pretax profits of £5,974,000,000, net profits of £4,046,000,000, declared assets of £1,563,402,000,000 and shareholder’s equity of £65,170,000,000 (source barclays.com).

Terms

Offers in excess of £1,100,000 (one million and one hundred thousand pounds) are invited for the freehold interest, subject to the existing lease.

Investment Summary

The subject property offers investors a 15 year unexpired term (with 10 years certain income) from a strong covenant in a historic and highly desirable corner of the capital. Based on the guide of £1.1 million, the passing rent of £51,000 reflects a Net Initial Yield of 4.38% (after allowing for purchaser’s costs of 5.75%). Please note I am not retained.