• On behalf of Administrators, acting as agent without personal liability

• Attractive retail & office investment

• Edinburgh is the UK’s most prosperous city outside London

• Located within the heart of the City Centre and financial district

• Ground floor let to the undoubted covenant of Tesco Stores Limited

• Offices let to national law firm Lyons Davidson – circa 8.5 years unexpired

• Heritable Interest (Scottish Equivalent of English Freehold)

• £3,950,000, subject to contract

• 6.82% Net Initial Yield

The property is situated on the west side of Earl Grey Street (A700) between its junctions with Fountainbridge to the north and Tollcross to the south. Surrounding occupiers include Boots, The Co-op, Sainsbury’s Local, Costa, Superdrug and Bank of Scotland.

Earl Grey Street forms part of one of the main arterial routes into Edinburgh City Centre from the south benefitting from high vehicular and pedestrian footfall. The subject property lies approximately 0.8 km (0.5 miles) to the south of Edinburgh City Centre within a mixed commercial and residential locality.

The property also benefits from being within the heart of Edinburgh’s financial hub and is surrounded by numerous blue chip financial, technological and professional businesses. Multinational law firm Pinsent Masons is located opposite the subject property. Semple Street and Edinburgh’s Exchange District are a mere 500 feet away with occupiers including Blackrock, Wood MacKenzie, Scottish Widows, Aberdeen Asset Management, Lloyds Banking Group, PWC, AON, IBM, Henderson Global Investors, Alliance Trust and Franklin Templeton. In addition, the Edinburgh International Conference Centre is a five minute walk to the north-west.

The subject property is an attractive building constructed in circa 1956 with a stone-built façade, arranged over basement, ground and four upper floors.

The ground floor comprises a retail unit which has been fitted out by the tenant, Tesco, in their usual corporate style.

The four upper floors provide office accommodation which are accessed via a separate entrance to Enterprise House, situated adjacent to the entrance to the retail unit. The offices benefit from a specification including raised access flooring, lift, comfort cooling, double glazed windows and lowered ceilings incorporating recessed strip lighting. Each floor has separate male and female WC’s and kitchen facilities. The first and second floors are currently unoccupied.

The basement accommodation is demised to the office tenant but is unused.

There are six dedicated car parking spaces to the rear of the property.

Heritable (Scottish equivalent of English freehold).

Retail

The ground floor is let to Tesco Stores Limited on effectively a full repairing and insuring lease for a term expiring on 8th December 2029 (8 years unexpired lease term). There is a tenant’s break option on 9th December 2024, subject to six months’ notice. The lease provides the landlord with the ability to recover costs in relation to common repairs.

The original lease was for a term of 15 years from 9th December 2004, expiring on 8th December 2019. In accordance with a Minute of Variation dated January 2020 the lease was extended for a further 10 years.

The current passing rent is £65,000 per annum. The lease benefits from an upwards only open market rent review on 9th December 2024.

Offices

The first, second, third and fourth floor office suites and basement premises are let to Lyons Davidson Limited on effectively a full repairing and insuring lease, subject to a Schedule of Condition, for a term of 15 years from 9th June 2015, expiring on 8th June 2030 (approximately 8.5 years unexpired). The tenant is required to pay a fair proportion of costs incurred by the landlord in insuring, repairing and maintaining the common areas.

The tenant has a right to use six car parking spaces within the car parking area.

The current passing rent is £222,030 per annum (£161 per sq m / £17.97 per sq ft overall). The lease benefits from five yearly open market rent reviews, the next being on 9th June 2025.

Therefore, an investor will benefit from a total income of £287,030 per annum.

It is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC) and the purchaser will be required to submit the appropriate election to HMRC. It should be noted that the administrators may not hold documentation to prove VAT election at the point of completion.

We are instructed to seek a figure of £3,950,000 (Three Million, Nine Hundred and Fifty Thousand Pounds), subject to contract, reflecting a net initial yield of 6.82%, assuming standard purchaser’s costs of 6.51%.

Please note that a purchaser will be re-charged the costs of the measured survey (£495 + VAT) and searches (£130 + VAT) which are provided in the data room.

The affairs, business and property of the Company is being managed by the Joint Administrators Andrew Knowles and Steven Muncaster, who act as agents for the Company and without personal liability. Both are licensed by the Insolvency Practitioners Association and are bound by the Insolvency Code of Ethics.

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