Nuffield Health, The Pentagon, Derby, DE21 6DA

SUMMARY

INVESTMENT SUMMARY

      • A prime, purpose built health and fitness club incorporating best in class facilities over 46,221 sq ft (4,294 sq m) GIA
      • Prominently located at the junction of the A61 and A52 to the east of Derby City Centre
      • The property is Nuffield Health’s sixth top performing gym facilities (out of 111) by EBITDA.
      • Let to Nuffield Health on an FRI lease until January 2043, providing 25 years term certain
      • 5 yearly rent reviews in line with the Consumer Price Index (CPI) subject to a cap of 3.50% and a collar of 1.00%, compounded annually
      • A Long Leasehold interest for 128 years from Derbyshire County Cricket Club Limited at a peppercorn rent from 3rd April 2000
      • Passing rent of £540,000 per annum equating to £11.68 per sq ft
      • Offers in excess of £9,200,000 (Nine Million, Two Hundred Thousand Pounds), subject to contract and exclusive of VAT.
      • A purchase at this level reflects a Net Initial Yield of 5.50%

LOCATION

LOCATION

Derby is the commercial centre of Derbyshire and forms the third largest conurbation in the East Midlands after Nottingham and Leicester. The City of Derby is located approximately 42 miles (67 km) north-east of Birmingham, 16 miles (26 km) west of Nottingham and 30 miles (48 km) to the south of Sheffield.
Derby benefits from advantageous transport links being located 7 miles (11 km) to the west of Junction 25 of the M1, accessed via the A52 to the east. To the west, the A50 links Derby to Stoke-on-Trent and Junction 15 of the M6 motorway, whilst to the south-west, the A38 affords quick access to Birmingham.

Derby occupies a key location in the national rail network, the mainline railway station lies within 0.7 miles (1 km) to the south of the property and direct trains run frequently to Birmingham New Street and London St Pancras with a journey time of approximately 35 minutes and 1 hour 30 minutes respectively.
East Midlands airport is located just over 10 miles (16 km) to the south east of the city and serves over 4 million passengers per year to a wide range of destinations throughout the UK and Europe.
The city serves a large and moderately affluent surrounding population of approximately 573,000 people within the primary catchment and 716,000 people within a 30 minute drive time of the property. Analysis of this demographic indicates a moderately wealthy, mobile and economically active population, with home and car ownership and employment levels higher than the national average.

SITUATION

SITUATION

The property is situated some 0.7 miles (1 km) to the north east of Derby City Centre and forms part of the Derbyshire County Cricket Club (DCCC) site. It occupies a prominent position on the Pentagon Island intersection which is where the A52 and A61 dual carriageways meet. The A52 east-west dual carriageway
links the city centre with Junction 1 of the M1 Motorway.

The property is accessed directly via the A61 Nottingham Road with nearby occupiers including a 100 bed Travelodge hotel, Aston Martin, Stratstone Mini, Euro Car Parts and the 14,000 seat capacity DCCC.

DESCRIPTION

DESCRIPTION

The property comprises a modern high quality, purpose built health and fitness club of steel framed construction, with metal clad elevations, beneath a curved
standing seam insulated metal roof. The principal internal feature of the building is the large glazed atrium over the pool and galleried balcony over the reception area.
At first floor level, there are extensive gym areas with a range of resistance and free weight training equipment, two dance studios and ancillary offices. The basement area incorporates pool plant, as well as a storeroom and workshop.
Plant facilities also exist in the roof void, including air conditioning chiller units.

ACCOMODATION

We have been provided with the total floor area which we understand has been measured in accordance with the RICS Code of Measuring Practice (6th Edition) on a net internal area (NIA) basis.

The property occupies a site totalling 1.41 hectares (3.49 acres) reflecting a site coverage of circa 17%.

TENANCY

TENANCY

The property is let on a full repairing and insuring terms to Nuffield Health for a term of 25 years from 24th January 2003 until 23rd January 2028.

At expiry, there is a reversionary lease to Nuffield Health from 24th January 2028 until 23rd January 2043. Both leases are subject to 5 yearly upward only rent reviews linked to CPI (Consumer Price Index), collared and capped at 1.00% and 3.50%, compounded annually.

The current rent passing is £270,000 per annum exclusive up to and including 23rd January 2019 and then reverts to £540,000 per annum from 24th January 2019 up to and including 23rd January 2023. The vendor will top up the rent in order that the investment produces £540,000 per annum.

TENURE

The property is held on 128 year leasehold interest from Derbyshire County Cricket Club Limited from 3rd April 2000 until 2nd April 2128 at an annual peppercorn rent.

TENANT COVENANT

TENANT COVENANT

Nuffield Health is the largest not-for-profit healthcare provider in the UK. Established in 1957 the charity operates 31 Nuffield Health Hospitals and 111 Nuffield Health Fitness & Wellbeing Gyms. In 2016, Nuffield Health acquired 35 Virgin Active clubs, one of which being the subject property.

Nuffield Health Derby Hospital is located just 15 minutes drive time from the subject property. As part of the Nuffield Group, physiotherapy patients from the hospital are provided with free short term gym memberships for their rehabiliation. Nuffield Health has a D&B rating of N1, reflecting a ‘minimum’ risk of business failure. Although the financial figures below show minor profits, Nuffield Health are a registered charity and state ‘our success is defined by our ability to improve people’s health’.

IMAGES

PHOTO GALLERY

PROPOSAL

VAT

The property is elected for VAT and it is the intention of the vendor to treat this transaction as a Transfer of a Going Concern (TOGC).

PRICE

Offers in excess of £9,200,000 (Nine Million, Two Hundred Thousand Pounds), subject to contract and exclusive of VAT
A purchase at this level reflects a Net Initial Yield of 5.50%.

MISREPRESENTATION ACT 1997 & DECLARATION

Buchanan Bond Real Estate Ltd, for themselves and for the vendors of this property whose agents they are, give notice that:
i) The particulars are set out as a general outline only for the guidance of intending purchasers, and do not constitute, nor constitute part of, an offer or contract.
ii) All descriptions, dimensions, references to condition and necessary permission for use and occupation and other details are given in good faith and are believed to be correct, but any intending purchasers should not rely on them as statements or representations of fact and must satisfy themselves by inspection or otherwise as to the correctness of each of them.
iii) No person in the employment of Buchanan Bond Real Estate Ltd has any authority to make or give any representation or warranty in relation to this property.

BROCHURE

BROCHURE

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