McColl's Convenience Store - Melksham

Available

McColl's Convenience Store Unbroken 16.5 Years Lease to a 5A1 Covenant with fixed uplifts

LOCATION

Melksham is a Wiltshire market town located 6.5 miles south of Chippenham and 11 miles east of Bath. The town is located on the A350 which provides access to Junction 17 of the M4 Motorway, 11 miles to the north. The A350 provides good access throughout the region and links to the A303 dual carriageway. The premises are situated in a densely populated residential area.

KEY POINTS

• Located in a highly populated residential area
• Let for 16.5 years with no breaks to the excellent covenant Martin McColl Limited
• Fixed uplifts at 2% pa
• Total current rents reserved £36,205 per annum, rising to £39,958 per annum in 2029
• Net initial yield of almost 6% with a reversionary yield in April 2024 to 6.54%

The property is a well maintained two storey detached building. The retail shop is arranged over the ground floor with ancillary accommodation to the rear of the unit. The first floor is residential and has been sold off on a long leasehold basis. The premises benefit from on street parking together with a rear car park offering parking for up to three vehicles. The unit has recently been refitted to McColl’s standard format.

Tenure

Freehold. The upper parts have been sold off on a long leasehold basis at a ground rent of £150 per annum.

Tenancy

The property is let to Martin McColl Limited for a term of 16.5 years from the 20th October 2017 on FRI terms and subject to fixed uplifts at 2% per annum compounded throughout. The passing rent is £35,000 per annum in addition a £150 per annum ground rent is received to the freeholder. The vendor will top up the rent to £36,055 per annum from completion until 19th April 2019 by way of a reduction in the purchase price.

Rent

Covenant

McColl’s trade from over 1,300 stores throughout the UK with approximately three quarters of those being convenience stores and the remainder trading as newsagents. Their brands include McColl’s, Martin’s and R. S. McColl. For the year ending 27th November 2016 reported a turnover of £518,736 million, a pre tax profit of £25,361 million and shareholder’s funds of £160,391 million.  The combined group has a turnover in excess of £1bn. It employs nearly 20,000 full and part-time staff and is visited by over 4.5 million customers every week. The company floated on the London Stock Exchange in 2014. Further information can be found at http://www.mccolls.co.uk/investor.

EPC

The property has an EPC rating of C68. A copy of the EPC is available on our website.

VAT

The property is elected for VAT which will be chargeable on the purchase price. It is anticipated the transaction is to be treated as a transfer of going concern (TOGC).

Proposal

We are instructed to seek offers in excess of £580,000 (subject to contract) for the freehold interest, which reflects a net initial yield of 5.95% assuming purchasers costs at 4.99%.