Prime Freehold Costa Coffee Investment

INVESTMENT SUMMARY

Freehold investment let to one of the UK’s most recognised coffee brands; Costa Coffee

Full Repairing & Insuring lease providing a secure, low-management income streamProminent position on Marygate; the prime retailing thoroughfare in Berwick-upon-Tweed

Immediate rental income with 5 years remaining unexpired on the lease

Re-based rent of £22,700 per annum, recently reduced from £32,000 pa

Neighbouring occupiers include B&M, Boots the Chemist, Caffè Nero, Greggs, WHSmith and Sports Direct

Excellent transport links: East Coast Mainline station serving Edinburgh, Newcastle and London Kings Cross

We are instructed to seek offers in excess of £260,000 reflecting a net initial yield of 8.50% based on purchasers’ costs of 2.76%, reflecting a very low capital value of only £59.81 psf.

LOCATION

The town of Berwick upon Tweed is situated in Northumberland on the border between England and Scotland. It is located approximately 65 miles north of Newcastle upon Tyne and 60 miles south of Edinburgh. The town functions as a regional service centre for North Northumberland and the eastern Scottish Borders, with a catchment population of around 42000.

Transport links include the East Coast Main Line, which provides rail services to London, Edinburgh and Newcastle. The A1 road bypasses the town to the west, connecting the area to the national road network.

SITUATION

Marygate, the town’s principal pedestrianised retail street, benefiting from high volumes of passing trade from residents, commuters and tourists visiting the Northumberland and Scottish Borders region.

The property at 32-34 Marygate is positioned on the western side of the street, which serves as the primary retail thoroughfare for the town centre. This location is within the main commercial area where the local market is held twice weekly on Wednesdays and Saturdays.

The immediate vicinity contains a variety of national and local retailers, including B&M, Boots the Chemist, Caffè Nero, Greggs, WHSmith and Sports Direct. The site is located within walking distance of the railway station and several public car parks.

DESCRIPTION

The property at 32-34 Marygate is a mid-terrace building of traditional stone construction, arranged over ground and two upper storeys. The facade is composed of ashlar sandstone with decorative cornicing and arched window surrounds.

The ground floor features a modern commercial frontage with large glazed windows and recessed double doors, currently occupied by a coffee shop. Above this, the first and second floors each contain three large sash windows set within rounded stone arches. The roofline is finished with a stone parapet.

To the front of the premises is a wide, cobbled pedestrian area which accommodates outdoor seating and street furniture.

TENANCY INFORMATION

The property is entirely let to Costa Limited on a new 5 year lease with 3 year break and a re-based rent of £22,700 per annum, having recently been reduced from £32,000 per annum. The property is held on FRI terms subject to a schedule of condition.

The tenant has recently carried out a scheme of improvement works, showing further commitment to the property.

COVENANT INFORMATION

The property is let to Costa Coffee, one of the UK’s leading coffee shop chains with over 1,300 stores across the United Kingdom and a significant international estate. Costa was founded in London in 1971 and was acquired by Coca-Cola in 2018.

Costa Limited has a “very low risk” profile according to Creditsafe.

TENURE

The property is held freehold with title number ND120913

VAT

The property is not VAT elected.

EPC

The property has an EPC rating of B

PROPOSAL

We are instructed to seek offersin excess of £260,000 reflecting anet initial yield of 8.50% based on purchasers’ costs of 2.76%, reflecting a very low capital value of only £59.81 psf.