LOCATION
Saltburn-by-the-Sea is a well-established seaside resort on the North Yorkshire coast, roughly 13 miles from Middlesbrough and within the Redcar and Cleveland borough. The town sits on the edge of the North York Moors National Park, with the A174 providing the principal road link west towards Middlesbrough and south-east towards Whitby.
The A1(M), around 32 miles away, connects onward to Newcastle to the north and Leeds to the south.
Saltburn's own railway station runs regular services to Middlesbrough, Darlington and Bishop Auckland.
SITUATION
The property sits squarely in the middle of Saltburn town centre, fronting Station Square immediately north of Dundas Street, with a roundabout linking through to Station Street directly outside the parade. This is the town's principal retail pitch.
A pedestrianised area to the north connects through to Milton Street and the Sainsbury's supermarket, while the railway platform lies immediately to the east. Saltburn Pier, the only pier remaining in Yorkshire, lies a short walk to the north-east and remains a strong draw for day-trippers.
DESCRIPTION
The building dates from 1862 and was originally Saltburn's railway station, designed by William Peachey; it has since been converted into a Grade II Listed parade of ten retail units.
Constructed from cream brick with ashlar dressings under a Welsh slate roof, the property retains many of its original Victorian features, including a central portico with Tuscan pilasters, round arches with ashlar architraves, and the original cast iron, single-glazed windows.
The building has been comprehensively refurbished by the current owner within the last 18 months, including a new roof covering and refurbishment of the stone plinths, materially improving the condition of the asset ahead of sale.
ACCOMMODATION
The property comprises ten retail units totalling approximately 6,239 sq ft (579.6 sq m).
TENANCY INFORMATION
The property is fully let to ten tenants, as detailed in the tenancy schedule below. Excluding a nominal public toilets letting to Redcar & Cleveland Council (10 sq ft, £10 per annum), the current passing rent from the ten retail units totals £99,687.50 per annum, reflecting a blended rent of £15.98 per sq ft.
A further rent uplift is imminent in respect of the Whitby Yard unit (Unit 5), which is expected to increase from £8,000 to £11,084 per annum. On completion, the total passing rent across the parade (including the nominal public toilets letting) will rise to £102,791.50 per annum, reflecting £16.47 per sq ft.
The weighted average unexpired lease term (WAULT) is approximately 4.98 years to expiries.
We have estimated the rental value of the parade with reference to the most recently agreed lettings within the building, giving an estimated rental value across the parade of circa £117,092 per annum, reflecting £18.77 per sq ft blended.
TENURE
The property is held long leasehold on a 125 year lease from 29 September 1983 (expiring on 28 September 2108), at a passing ground rent of £8,250 per annum. The lease is subject to five yearly upward only rent reviews, with the ground rent review linked to a proportion of the occupational rents received from the retail units.
VAT
The property is not elected for VAT.
ENERGY PERFORMANCE CERTIFICATE
Unit 1 – C
Unit 1A – C
Unit 2 – C
Unit 3 – C
Unit 4 – E
Unit 5 – Available soon
Unit 6 – E
Unit 7 – C
Unit 8 – Available soon
Unit 9 – Available soon
SERVICE CHARGE
Total service charge cost of £25,310.00 which is fully recoverable from the tenants.
PROPOSAL
We are instructed to seek offers in excess of £1,095,000 (One Million and Ninety Five Pounds), subject to contract, for the long leasehold interest. A purchase at this level reflects a net initial yield of 8.16%, after purchaser's costs of 5.84% and deduction of the ground rent of £8,250 per annum, based on the current passing rent of £102,791.50 per annum following completion of the imminent Whitby Yard uplift.
This would rise to a reversionary yield of 9.39%, based on the estimated rental value of £117,092 per annum, again assuming purchaser's costs of 5.84% and deduction of the ground rent.
