• In excess of 21 years unexpired lease term (no breaks)

• 3-yearly CPI linked rent reviews (uncapped) – next review July 2022

• Tenant has invested over £4 million in the property

• Secure income with the tenant recently acquired by infrastructure fund Quinbrook for £13.5 million

• Tenant has secured a new 15 year contract with National Grid

• Low passing rent equating to £3.83 per sq ft

• Established industrial & trade location

• £750,000, subject to contract

• 5.43% Net Initial Yield

The property is situated in an established commercial location on the Clay Flatts Trading Estate and is accessed via the A597 (Solway Road), the main road running through the estate which links directly with Workington train station 0.8 km (0.5 miles) to the north. The town centre is approximately 1.6 km (1 mile) to the north-east.

The Clay Flatts Trading Estate attracts a wide range of businesses and occupiers including Booker (adjacent), Travis Perkins (directly opposite), Topps Tiles, Howdens, ATS Euromaster, Edmundson Electrical, Jewson, Protyre, Screwfix and Matalan.

The Land Securities owned Derwent Howe and Derwent Retail Park is immediately to the west and comprising over 168,000 sq ft of floor space is the dominant retail provision in the area. Occupiers include Morrisons, B&Q, B&M, Halfords, Pets at Home, Currys PC World, McDonald’s and Aldi.

The tenant has invested in excess of £4 million in the property, undertaking a comprehensive refurbishment in 2018 and fitting it out as a Peaking power plant.

The subject property comprises an industrial unit of steel portal frame construction with brick walls, above which there is metal profile sheet cladding to its elevations and pitched roof.

The unit is accessed via a roller shutter at its front elevation and a number of personnel doors at its western, southern and eastern sides.

Internally, the property consists of a main warehouse area with ancillary office accommodation split over ground and first floors. The unit benefits from apex and eaves heights of approximately 5.77 metres (18.9 feet) and 4.62 metres (15.16 feet), respectively.

The property houses three state-of-the art, low carbon commission generators.

Externally, the building is bounded by a tarmac surfaced yard area with the site secured by a steel palisade fence and accessed via double metal gates.

What are Peaking Plants?

Peaking plants are power plants that generally run only when there is high demand, known as peak demand, for electricity.

The UK used to produce a constant supply of power from primarily coal fired power stations, as well as some nuclear. As part of the UK’s attempts to cut CO2 emissions, the Government is aiming to remove coal from Britain’s energy system by 2025. The UK and other counties are moving away from large scale power plants to renewable energy sources, primarily on shore and off shore wind and solar.

These intermittent and unpredictable renewable sources of power pose a risk to increased fluctuations in energy supply. Peaking plants are power plants designed to balance the fluctuating power requirement in the electricity network and operate during periods of high level demand for electricity or shortfalls of electricity supply. As they supply power only occasionally, the power supplied commands a much higher price per kilowatt hour than base load power.

Peaking plants provide important balancing services where weather conditions prevent output either when the wind is not blowing or the sun is not shining. They address this imbalance and reduce stress on the electricity grid, providing power stability – to potentially avoid blackouts and maintain the security of electricity supply.

Operating in standby mode when not in use, these plants are called to operate by the electricity grid when there is a demand to supply electricity (Source: www.edina.eu).

Hence, the subject property is key to the grid providing local power when there is a loss of supply.

We estimate the site area to be approximately 0.21 hectares (0.52 acres).

Long leasehold from Allerdale Borough Council for a term of 125 years from 11th May 2016, expiring 10th May 2141 (in excess of 120 years unexpired) at a peppercorn rent.

The permitted use is for Class B1, B2 or B8 of the Town and Country Planning (Use Classes) Order 1987.

The principal activity of TGC Emerald Limited is electricity generation. Their parent company is Gas Power Developments Limited.

Gas Power Developments was acquired by Quinbrook Infrastructure Partners in 2019 for £13.5 million and at the time of acquisition consisted of 5 operating gas peaking projects and one development project; the subject site being 1 of these 6 projects. Quinbrook has since acquired a portfolio of 22 gas peaking projects which will have a capacity of 308MW once fully constructed.

Quinbrook is a specialist investment manager focused exclusively on lower carbon and renewable energy infrastructure investment and operational asset management in the US, UK and Australia. Quinbrook is led and managed by a senior team of power industry professionals who have collectively invested over US$17 billion in energy infrastructure assets since the early 1990's. Quinbrook's investment and asset management team has offices in Houston, London, Jersey, and the Gold Coast of Australia.

Quinbrook acquired TGC Emerald Ltd within its Low Carbon Power Fund, a fund with access to $1.6 billion of investor commitments focusing on investment in the “new build lower carbon and renewables energy sector” in the USA, UK and Australia.

Quinbrook manages funds on behalf of a range of institutional investors. Quinbrook managed funds have made investments in a diverse array of portfolio companies and projects spanning both utility and distributed scale wind power, solar PV, battery storage, 'embedded networks', grid supporting flexible power solutions, 'Virtual Power Plant' portfolios and related ‘smart grid’ projects in the US, UK and Australia. For further information visit www.quinbrook.com.

TGC Emerald Limited was incorporated in 2015 to produce electricity to supplement renewable energy at times of low supply and/or peak demand to ensure a consistent supply to the national grid. They currently operate 15 generators from 5 sites across the UK with another site under construction. The company was sold by the previous parent company TGC Renewables Group Limited to Gas Power Developments Limited (GPDL) in 2017.

Their sites are operated by Orsted Group (who are one of the largest renewable energy producers in Europe). Orsted trade the assets into the market at periods of low reserve margin and also optimise the assets within their Renewables Balancing Reserve, an imbalance market designed to support Orsted’s fleet of renewable generation. TGC have utilised new technologies in their equipment and sites which provide highly efficient generation. TGC has long term agreements with Orsted (Headquartered in Denmark, employing 6,120 people, listed on the Nasdaq Copenhagen stock exchange with a group revenue of DKK 67.8 billion (EUR 9.1 billion) in 2019).

During the 2019 financial year fixed assets increased from £14.378m to £20.224m. In FY18 there was long-term debt taken from Close Brothers for asset finance of £11.75m.

TGC Emerald has secured a Capital Market contract with National Grid for a term of 15 years from October 2020. This is a fixed term contract without break clauses. At the expiry of this 15 year contract it is anticipated a similar contract will be available as there will continue to be a National Grid requirement for back-up power in times of supply/demand issues on the grid.

The property has been registered for VAT. It is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).

1. An opportunity to acquire a well-secured industrial investment;

2. Long unexpired lease term of over 21 years, without breaks;

3. The lease benefits from 3-yearly, uncapped CPI linked rent reviews with the next being in July 2022;

4. The tenant has invested in excess of £4 million in the property;

5. The property provides secure income, with the tenant recently acquired by infrastructure fund Quinbrook for £13.5 million;

6. The tenant has recently secured a new 15 year contract with National Grid, signalling their long-term commitment to the subject property;

7. Low passing rent equating to £3.83 per sq ft;

8. The property is situated in an established commercial location;

9. A purchase at the asking price will provide an investor with an attractive yield profile;

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