GE-DVLA-Swansea.indd

DVLA, Sandringham Park, Swansea, SA6 8AJ

Grade A Business Park Ofce Investment Let to the Government

DVLA, Sandringham Park, Swansea, SA6 8AJ

INVESTMENT SUMMARY

• Modern well specied Swansea ofce investment in an established business area.

• Highly accessible location 4 miles north of Swansea city centre and adjacent to

Junctions 44 and 45 of the M4 motorway.

• Single-let ofce building totalling 66,855 sq ft.

• Let in its entirety to The Secretary of State for Transport and occupied by the Driver

and Vehicle Licensing Agency (DVLA).

• The property is DVLA’s sole UK contact centre and the tenant occupies two other

buildings on Sandringham Park.

• The tenant has been in occupation since the building was constructed in 2004 and

recently regeared their lease for a further 10 years, expiring 29 August 2029, subject

to a tenant break option on 30 August 2024, reecting 11.25 yrs WAULT to expiry and

6.25 years to break.

• Rent to be topped up to £800,000 per annum, equating to £12 psf.

• Site area of approximately 1.24 hectares (3.07 acres), which reects a low site density

of 25%.

• 125 year Long Leasehold from 20 December 2002.

• We are instructed to seek offers in excess of £9,300,000, subject to contract and

exclusive of VAT. A purchase at this level would reect an attractive Net Initial Yield of

8.00% and a low capital value of £138 psf, assuming purchasers costs of 7.57%.

• Assuming the tenant does not activate their option to break in 2024, the xed rental

uplift in 2027 reects a highly attractive reversionary yield of 9.00%.

DVLA, Sandringham Park, Swansea, SA6 8AJ

BLAWD ROAD

SANDRINGHAM PARK

M4 J45 (3 MILES)

M4 J44 (1.5 MILES)

DVLA, Sandringham Park, Swansea, SA6 8AJ

M49

M32

M48

A4232

A470

A449

A429

A465

A48

A40

A39

A36

A40

A48

GLOUCESTER

SWANSEA

Port Talbot

Bristol Channel

Weston-super-Mare

Cardi

International

Bridgewater

Newport

Bath

Cheltenham

CARDIFFCARDIFF

SWANSEA

BRISTOL

GLOUCESTER

LOCATION

Cardiff Airport

36 miles / 53 mins

Cardiff City Centre

42 miles / 25 mins

M4 Junction 44

1.5 miles / 4 mins

M4 Junction 45

3 miles / 5 mins

Swansea Train Station

4.3 miles / 10 mins

Swansea City Centre

4.9 miles / 15 mins

Bristol City Centre

80 miles / 1 hr 20 mins

DVLA, Sandringham Park, Swansea, SA6 8AJ

SITUATION

The property is situated within the Swansea Vale, an extension of Swansea Enterprise Park, which has

been at the heart of Swansea’s regeneration and development for over 25 years, attracting thousands of

jobs and millions of pounds of investment to the local economy.

The property is situated on Sandringham Park, within Swansea Vale, approximately 4 miles north of the

city centre and lies adjacent to Junction 44 and 45 of the M4 motorway. Sandringham Park is within

the second phase of Swansea Enterprise Park which comprises 335 acres of mixed use commercial,

residential and leisure facilities.

SWANSEA VALE

PENIEL GREEN

THE FAIRWAYS

J45

J44

A48

BLAWD RD

A48

A4067

MAJOR OCCUPIERS IN THE VICINITY INCLUDE:

SWANSEA DEMOGRAPHICS

Swansea has a population

of 244,500

Swansea has a daily in ow of

15,500 people

Two million people live

within an hours drive of

Swansea and six hundred

thousand within a half an

hours drive

There is a student population

of 24,000

DVLA, Sandringham Park, Swansea, SA6 8AJ

DESCRIPTION SITE

The property comprises a Grade A ofce building constructed in 2004 totalling 66,855 sq ft over ground

and rst oors.

The property is of steel portal frame construction beneath a pitched roof and part brick/clad elevation

benetting from the following specication:

• Full raised access oors

• Suspended ceilings incorporating recessed uorescent strip lighting

• Fully air-conditioned

• Two 10 person passenger lifts

• Three feature atriums

• Male/female/disabled WC facilities on each oor

• Highly secure facility with 24 hour manned reception area

• Excellent car parking ratio of 1:275

• Signicant tenant t-out which includes a fully-tted canteen/kitchen facility for 850 staff together

with seven additional breakout areas and a back-up power generator

• The building is IL3 accredited offering the highest level of security in terms of data storage

processing with secure government internet connections.

The site extends to approximately 1.23 hectares (3.03 acres) equating to a site

coverage of c. 25%.

DVLA, Sandringham Park, Swansea, SA6 8AJ

Tenant Name Total Area (sq ft) Lease Start

Lease Expiry

(break)

Contracted Rent

per annum

Rent (psf) Comments

The Secretary of State for

Transport

66,855 sq ft 30/08/2019

29/08/2029

(30/08/2024)

£800,000

£12.00

FRI Lease subject to a Schedule of Condition.

Passing rent to 29/08/2019: £670,000 p.a.

Rent from 30/08/2019-29/08/2022: £564,500 p.a.

Rent from 30/08/2022-29/08/2024: £800,000 p.a.

Rent from 30/08/2024-29/08/2025: £225,000 p.a.

Rent from 30/08/2025-29/08/2027: £800,000 p.a.

Rent from 30/08/2027-29/08/2029: £900,000 p.a.

*The tenant will receive the equivalent of 8.5 months rent free, if

they do not activate their break clause in 2024.

TENURETENANCY

COVENANT

The property is held on a Long Leasehold basis under Title number CYM203929

from Swansea City Council for a term of 125 years from 20 December 2002 at a

 xed rent of £500 per annum.

The property is let to The Secretary of State for Transport (occupied by the DVLA) who have occupied the facility from

completion in 2004. DVLA have recently agreed a new reversionary 10 year lease commencing 30 August 2019 with a

break option at the end of the  fth year, demonstrating their continuing commitment to the location.

The tenant incentive was granted by way of a stepped rent, which will be topped up to £800,000 per annum.

The entire property is let to the undoubted covenant of The Secretary of State for Transport and occupied by the DVLA,

who have occupied the facility as their main contact centre since the property was constructed in 2004.

The Driver & Vehicle Licensing Agency (DVLA) is an executive agency sponsored by the Department of Transport. The

DVLA hold over 48 million driver records and over 40 million vehicle records, collecting around £6 billion a year in

vehicle excise duty (VED). They maintain the registration and licensing of all drivers in Great Britain, together with the

collection and enforcement of VED in the UK.

The property is used as the DVLA’s sole contact centre for the UK and Northern Ireland following the recent closure of

all other 39 local DVLA of ces. They currently employ 1,100 staff at the facility and the contact centre deals with in

excess of one million calls per month. The DVLA are the biggest employer in Swansea, with two further buildings on

site – a Learning and Development Centre and an Innovation centre, and three further buildings in the region, including

their Headquarters in Morriston.

The building has speci c infrastructure in accordance with the Government data storage/processing requirements.

There is a 5 yearly PPM programme in place.

For further information, please see www.dvla.gov.uk.

DVLA, Sandringham Park, Swansea, SA6 8AJ

OCCUPATIONAL MARKET

INVESTMENT MARKET

• Swansea Enterprise Park is Swansea’s key ofce location and is at the heart

of the regions economic growth and regeneration, attracting thousands of

jobs and millions of pounds of investment to the local economy.

• There is very limited modern well specied ofce availability in Swansea, with

only c.13,000 sq ft of comparable quality stock available in the region, split

across three buildings.

• Prime ofce rents in Swansea currently range from £12 - £14 psf, with

Swansea Enterprise Park and Swansea waterfront (‘SA1’) commanding the

highest rents.

• The regional investment market continues to attract strong interest from

a diverse range of domestic and international investors who are attracted

by the greater returns compared to the Central London and South East

markets.

• Demand for business park assets has strengthened over the past 12

months with investors attracted to the greater returns on offer and more

favourable occupational market dynamics. This resulted in 2017 business

park investment volumes of c. £3.25bn, up c.35% on 2016 levels.

• There is robust demand from investors for good quality business park

assets in core regional markets. The subject facility offers investors

secure government income in a long established location, whilst also

offering signicant return on capital investment.

Property Sq Ft Tenant AWULT

Purchase

Price

NIY

Cap Val

(psf)

Date

Riverside Ofce Park, Stoke-on-Trent 83,076 Michelin Tyre Plc 7.0 yrs £14.0m 8.00% £169 Mar-18

500 Aztec West, Bristol 102,483 Atkins Ltd 8.2 yrs £32.25m 6.69% £315 Mar-18

Renaissance House, Lakeside, Warrington 40,679 Secretary of State 8.8 yrs £10.50m 5.69% £258 Feb-18

One and Two Charter Court,

Wolverhampton Business Park

22,819

Charter Court

Financial Services

10.0 yrs £4.565m 6.45% £200 Feb-18

Sonova House, Warrington 43,392 Phonak 10.5 yrs £11.425m 4.96% £263 Dec-17

Bristol Business Park, Bristol 85,788 Babcock 15.0 yrs £30.1m 5.00% £351 Oct-17

EPC

Energy Performance Certicate is available upon

request.

VAT

The property is elected for VAT and it is

anticipated that the transaction will be treated

as a Transfer of Going Concern (TOGC).

DATA ROOM

Data room access will be provided upon request.

PROPOSAL

We are instructed to seek offers in excess of

£9,300,000, subject to contract and exclusive

of VAT. A purchase at this level would reect an

attractive Net Initial Yield of 8.00% and a low

capital value of £138 psf, assuming purchasers

costs of 7.57%.

Assuming the tenant does not activate their

option to break in 2024, the xed rental uplift in

2027 reects a highly attractive reversionary

yield of 9.00%.

Conditions under which these particulars are issued

All details in these particulars are given in good faith, but Gerald Eve LLP for themselves and the Vendors/Lessors of this property for whom they act give notice that:-

1. These particulars do not and shall not constitute, in whole or in part, an offer or a contract or part thereof, and Gerald Eve LLP have no authority to make or enter into any such offer or contract.

2. All statements contained in these particulars are made without acceptance of any liability in negligence or otherwise by Gerald Eve LLP, for themselves or for the Vendors/Lessors.

3. None of the statements contained in these particulars is to be relied on as a statement or representation of fact or warranty on any matter whatsoever, and intending purchasers must satisfy themselves by whatever means as to the correctness of any statements made within these particulars.

4. The Vendors/Lessors do not make, give or imply, nor do Gerald Eve LLP or any person in their employment have any authority to make, give or imply, whether in these particulars or otherwise, any representation or warranty whatsoever in relation to the property.

The statement does not affect any potential liability under the Property Misdescriptions Act 1991. Particulars issued June 2018.

Gerald Eve LLP is a limited liability partnership registered in England and Wales with registered number OC339470 and its registered ofce at 72 Welbeck Street, London, WIG 0AY

FURTHER INFORMATION

Callum Robertson

T: 0161 259 0480

E: [email protected]

Charlotte Campbell

T: 0161 259 0469

E: [email protected]

Jason Nearchou

T: 020 3486 3475

E: JNearchou@geraldeve.com

Peter Graham

T: 029 2038 1877

E: PGraham@geraldeve.com

For further information or to arrange and inspection, please contact the following: