Clayton Street, Newcastle Upon Tyne

Investment Summary

This is a rare opportunity to acquire a prominent Grade II Listed freehold investment located in the heart of Newcastle city centre. The property comprises a mix of a ground-floor commercial unit and three spacious 4-bedroom apartments. The building is fully let, currently producing a passing rent of £76,490 per annum, with a pre-agreed increase to £81,572 per annum scheduled for next year.

Location

Situated at the corner of Clayton Street and Fenkle Street, the property occupies a strategically central position opposite Hotel Indigo and adjacent to Newcastle's vibrant Chinatown. It is within short walking distance of major landmarks including Eldon Square, The Gate, and NX Newcastle. Excellent transport links are provided by nearby Monument and St James Metro Stations, with Newcastle Central Railway Station also easily accessible on foot.

Commercial Tenancy

The ground floor and basement are let to a hot food takeaway trading as "Dream Burger". The lease runs until February 2048 with no break options, providing exceptional long-term security. The lease includes five-yearly rent reviews, with the next review scheduled for February 2028.

Residential Accommodation

The upper floors contain three 4-bedroom apartments. Current residential rents average only £86.53 per person per week (pppw) for the 25/26 term and £94.67 pppw for the 26/27 term, offering significant scope for future rental growth in a city with a high student and professional population.

Regeneration

The property is set to benefit from major nearby developments, including the Pilgrim Quarter, which will house approximately 9,000 HMRC staff from 2027. This, alongside projects like Bank House and the redevelopment of the Pilgrim Street Fire Station, is expected to significantly increase local demand for both retail and residential space.

Tenure & VAT

The property is held Freehold under title number TY97367. It is understood that the property is elected for VAT, and it is anticipated that the sale will be treated as a Transfer of a Going Concern (TOGC).

EPC Ratings

Dream Burger: B Apartment 1: D Apartment 2: C Apartment 3: B

Proposal

We are instructed to seek offers in excess of £920,000 (Nine Hundred and Twenty Thousand Pounds). A purchase at this level reflects a net initial yield of 8.39% based on the 2026/2027 rent of £81,572 per annum, assuming standard purchaser's costs of 5.66%.