C PIT HOUSE BROOKFIE LDS PARK , DEARNE VALLE Y, ROTHE RHAM S63 5DJ - WELL SECU RED LONG INCOM E CALL CENTRE WITH ANN UAL RPI RE VIEWS - Lewis Ellis
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C PIT HOUSE
B ROO K FI E LDS PAR K , D E AR N E VALLE Y, ROTH E R HAM S63 5 DJ
WELL S ECU R ED LO N G I N CO M E C ALL CENTR E
WITH AN N UAL R PI R E VI E WS
INVESTMENT SUMMARY
• Highly accessible location in South • Capita House comprises a well specified • Annual net rent of £1,714,500 per annum We are instructed to seek offers in excess
Yorkshire with an increasingly skilled work purpose-built call centre measuring (£12.61 per sq ft). of £25,700,000 (Twenty Five Million, Seven
force. 135,938 sq ft (12,629.2 sq m). Hundred Thousand Pounds), subject to
• Rent to increase annually with RPI linked contract and exclusive of VAT.
• Established mixed use area with a number • The income is well secured to Capita uplifts throughout the term with a 1%
of national and international occupiers Business Services Ltd (guaranteed by collar and 4% cap. A purchase at this level represents a net initial
including Next, Saint Gobain, Capita Capita Plc) and held on FRI lease terms. yield of 6.25% equating to an equivalent yield
Services, South Yorkshire Police, Cepac, • Excellent car parking ratio of 1:328 sq ft of 7.05%*, after allowing for purchaser’s costs
E-On, RBS, G4S, Web Help, Royal Mail, • The guarantor, Capita Plc, has a current (415 car parking spaces). of 6.76%. This reflects a low capital value of
Thetford and the Dearne Valley College market capitalisation in excess of £2 billion £189 per sq ft.
amongst others. and reported a profit before tax to the year • Long leasehold, however, the freehold
end December 2018 of £272.6 million. can be purchased at any point for £1. *The equivalent yield assumes RPI growth of
3% p.a. for the duration of the term.
• Unexpired term of approximately 18.5 years.
C PIT HOUSE
B R O O K F I E L D S PA R K , D E A R N E VA L L E Y, R O T H E R H A M S 6 3 5 DJ
MEXBOROUGH
LOCATION
Callflex Business Park
The Dearne Valley is centrally located within the metropolitan borough of • E-on • RBS
• Keepmoat • G4S
Rotherham and within the county of South Yorkshire. This strategic position • Morphy Richards
provides excellent access to a number of skilled labour pools that make up
the population of South Yorkshire, which currently stands at approximately
1.34 million people.
The property is positioned 6 miles (10 km) to the north of Rotherham, 9 miles
(15 km) north-west of Doncaster, 9 miles (15km) south-east of Barnsley, 14
miles (22.5 km) north east of Sheffield and 37 miles (60 km) south of Leeds,
all of which are within a 20 minute drive of the Dearne Valley.
Tadcaster
LEEDS GD Web Offset
BRADFORD
13
14
A64 A1(M)
LEEDS
12
8
10 Burnley BRADFORD M1
1 47
M621 A63
43
Halifax 26
27 37
A58
Batley
30
Castleford
41
31 32 36 Goole
25 33 34
24 Dewsbury 40 Wakefield M62
23
A642 M18
Rochdale M62 A1
1 22 Huddersfield 39
A19 6
M66 A629 38 Hemsworth A638 Thorne
21
2 5
1
3 19
20
M1 38
M180 2
Barnsley
37
17 A635 37 4
15
M60 Wath upon Doncaster
36
A628 A616 Dearne 36
ROBIN HOOD
Stocksbridge
MANCHESTER 35
1 3
A1(M)
6
Rotherham
M60 34
1
9 A631
Stockport 34
33
SHEFFIELD
32 34
5
6
MANCHESTER M1
31 A1
Retford
CONNECTIVITY
ROAD AIR RAIL
The Dearne Valley has excellent road access being equidistant Leeds Bradford International Airport is located 38 miles (68 km) Mexborough train station is located approximately 2.5 miles
between the A1(M) and the M1 with Junction 36 of the M1 and to the north with a journey time of approximately 60 minutes. (4 km) from the property and provides a direct and regular
A1(M) both approximately 8 miles (13 km) to the west and east It provides domestic and European flights to a number of service to Doncaster, which in turn provides direct fastest
respectively. Both in turn link with the M62 to the north. locations. In addition Robin Hood Doncaster/Sheffield airport is journey times of 1 hour 38 minutes to London, 3 hours to
located approximately 20 miles (32 km) to the east. Edinburgh and 4 hours to Glasgow.
The area is served by numerous bus routes to the surrounding
residential areas.
THETFORD GD WEB OFFSET
GLASS SOLUTIONS CEPAC SITUATION
HOLIDAY INN EXPRESS
WATERFRONT GOLF
The property occupies a highly prominent corner
position on the junction of Meadows Road and
M1 SAINT GOBAIN
A6
Manvers Way (A633), the main linking road to the
33
WATERFRONT BOAT CLUB A6195 and on to Junction 36 of the M1.
NEXT
BA R
The Dearne Valley is made up from a number of
NS
LE key developments including Brookfields Park,
Y A633 MAN
R V E R S WAY Callflex Business Park, Adwick Park and Houndhill
O
Industrial Park.
RD
AD
ION
D
OA
MA
Capita House is considered a high grade call
TAT
NR
CAPITA NV
ER
centre and forms part of Brookfields Park. The
TO
33 S
S
BOL
building has been occupied since its construction
A6
W E S T S TREET W
AY WEBHELP UK in 1998 by Ventura, who were latterly acquired
DONCAST
by Capita Plc. Immediately adjacent to Capita
WEST
ER RD
RBS
House is another bespoke call centre facility of a
YORKSHIRE
POLICE similar size, also occupied by Capita.
ROYAL MAIL Callflex Business Park and Adwick Park followed
A1 the development of Brookfields during the
A6
TESCO EXTRA PARAGON
A 6 3 3 S A N DYG AT E
02
DEARNE
W mid-late 1990’s. These schemes were largely
3
VALLEY AT
KWIK FIT COLLEGE H
RD speculative, with the exception of two pre-let
ASDA
buildings to Hero TSC, WebHelp and RBS.
CALL FLEX NHS 111
E-ON ENERGY MORPHY RICHARDS
THE DEARNE VALLEY ENTERPRISE ZONE
The Property is located in the former Dearne Valley Call centre operators from both private and public sectors
Enterprise Zone, an area of approximately 250 acres, which have been attracted to the area, which has also become a
was established in 1995 to regenerate the area and create hub for regional distribution.
employment opportunities following the closure of the
South Yorkshire collieries. Occupiers on the park include Next, Saint Gobain, Capita
Services (in adjacent call centre), NHS, UK Commission for
The area is now established as a major business location Employment Skills, South Yorkshire Police, Department
for distribution warehousing, office buildings and call for Work and Pensions, Cepac, E-On, RBS, G4S, Web Help,
centres, which all benefit from attractive car parking ratios. Royal Mail, Paragon, Morphy Richards, Thetford and Dearne
Valley College amongst others.
C PIT HOUSE
B R O O K F I E L D S PA R K , D E A R N E VA L L E Y, R O T H E R H A M S 6 3 5 DJ
DESCRIPTION
Capita operate out of two adjoining buildings at Dearne Valley, Capita House
and Ventura House. Over 7,000 people are employed over the two sites with
approximately half of these employed in Capita House. Call centre contracts within
the building include O2, N.Power, Transport for London, William Hill, RSPCA and LAA
(Legal Services Commission), the last 3 operating 24/7. With the exception of TFL all
these contracts have been in the building for over 6 years.
Capita House was constructed in 1998 and comprises a well specified high grade
purpose-built call centre, with an IPMS 3 area of 135,938 sq ft (12,629.2 sq m). The
property provides open plan call centre space, ancillary offices and amenity facilities
arranged on ground and a mezzanine level.
The property is of steel portal frame construction with composite metal cladding
panel elevations. The roof is insulated and of pitched construction and the windows
are double glazed with powder coated aluminium frames. A mezzanine runs through
the centre of the building and also along the north and south elevations. The building
has two principal cores at either end, which both house passenger lifts.
The property has a site area of approximately 3.214 hectares (7.942 acres).
The building benefits from the following specification:
• Fully fitted cafeteria, break out rooms male/ • Suspended ceilings to all circulation areas
female showers and additional WC facilities. and compartmentalised offices. The office
accommodation below the central mezzanine
• Meeting and training rooms. has a floor to ceiling height of 2560mm.
• The ancillary facilities are generally situated • Four-pipe fan coil air conditioning.
through the centre of the building, splitting
the ground floor into two large open plan • Fluorescent lighting in the form of 1000W
office areas. These can be further sub-divided uplighters and suspended direct/indirect
to accommodate separate contracts (or fittings.
occupiers) within the space.
• The property has an excellent car parking
• Raised access floors (void 350mm). ratio of 1:328 sq ft (415 car parking spaces).
ACCOMMODATION The property has been measured by Plowman Craven in accordance with the International Property Measurement Standards (1st Edition, May 2015) and provides the following IPMS3 floor areas: Demise Sq ft Sq m Ground Floor 91,280 8,480.2 First Floor 44,658 4,149.0 TOTAL 135,938 12,629.2 The Plowman Craven measured survey is available in the data room.
C PIT HOUSE
B R O O K F I E L D S PA R K , D E A R N E VA L L E Y, R O T H E R H A M S 6 3 5 DJ
TENURE
The property is currently held long
leasehold, however, the freehold can be
purchased at any point for £1.
The leasehold is held by way of a 125 year
(less 3 days) interest from 16th March 1998
to 12th March 2123 (104 years unexpired)
at an annual rent of £50 per annum.
This lease was granted out of a headlease
for 125 years dated 16th March 1998.
The head lessor and freeholder is
Rotherham Borough Council.
TENANCY
The property is let to Capita Business
Services Ltd with a guarantor of Capita
PLC.
The lease is held on full repairing and
insuring terms from 16th September 2016
and expiring 26th December 2037 (18.5
years unexpired).
The current passing rent is £1,714,550
per annum (£12.61 per sq ft). The rent
is reviewed annually with RPI uplifts
throughout the term collared and capped
at 1% and 4% per annum respectively.
The next rent review is due on the 27th
December 2019.
The net rent totals £1,714,500 per annum.
COVENANT
TENANT GUARANTOR
Capita Business Services Limited is a wholly owned subsidiary Capita Plc is the largest UK based outsourcing company, The aim of the transformation plan in 2018 was to fix, stabilise
of Capita PLC. The company operates within the Digital employing over 63,000 people with a current market and set a new direction for the business. With the reduction in
& Software Solutions, IT Services, Private/Public Sector capitalisation in excess of £2.03bn and a reported turnover to debt, new leadership and a return to profitability, Capita have
Partnerships and Professional Services divisions within the the year end December 2018 of £3.918bn. clearly achieved this and entered a new era. The company now
wider Capita group. plans to build momentum throughout 2019 and deliver its
Capita reported positive year end accounts for 2018, which targets in 2020.
The principal activities of the company are the provision of highlight substantial progress in its three-year transformation
outsourcing services, which principally consist of: plans, with the company being where it wants to be at the end Capita Plc has recorded the following accounts over the last 3
of the first year and having a clear plan laid out for 2019. years:
• Taking complete responsibility under long term contracts
for a range of customer services, IT, business support & The transformation plans were set out in December 2017
consultancy. and consisted of a significant restructuring, under the newly 2018 2017 2016
• Providing administration and related services. appointed CEO Jonathan Lewis, following a successful rights
issue. Capita also implemented a detailed internal review to Revenue £3,918.4m £4,234.6m £4,368.6m
• Providing recruitment, training, career change and out create a new strategy to simplify and strengthen the business,
placement services to the public and private sectors. which included reducing the number of areas it operates in Profit/(Loss)
£272.6m £(513.1)m £89.8m
from 40 to 6. Before tax
Capita Business Services Limited has recorded the following
accounts over the last 3 years: Net Debt £466.1m £1,117.0m £1,778.8m
These six divisions are:
31.12.2017 31.12.2016 31.12.2015 Further detailed information for the 2018 and previous years
• Software accounts are set out on the Capita website along with the
(000) (000) (000)
• People Solutions Chairman’s statement setting out the new company strategy,
Sales/ • Customer Management which can be found at the following link:
£1,454,791 £1,421,937 £1,319,754
Turnover
• Government Services
Profit/Loss www.capita.com/investors/year-in-review
£124,369 £137,765 £236,946 • IT & Networks
Before Taxes
• Specialist Services
Tangible Net
£(21,092) £412,449 £525,577
Worth The strategy also aims to re-focus the business on growth
Net Current markets and to improve cost competitiveness in order to
Assets £(179,299) £448,723 £315,218 deliver enhanced performance. To fund this new strategy
(Liabilities) Capita implemented an effective rights issue that raised £701m
with a positive 97% take up rate from investors.
The rights issue was fully underwritten by Citigroup and
Goldman Sachs, further demonstrating long term confidence
in the company. £408m was also raised from the disposal of
non-core business during 2018. This combined with the rights
issue has reduced net debt from £1,117m in 2017 to £446.1m in
2018.
C PIT HOUSE
B R O O K F I E L D S PA R K , D E A R N E VA L L E Y, R O T H E R H A M S 6 3 5 DJ
OCCUPATIONAL MARKET
The current passing rent of £12.61 per sq ft is in line with start rents on other
call centres in similar locations. Examples include:
Area Rent
Date Address Tenant
(sq ft) (psf)
Thomas
Q2 2016 West Point, Peterborough 111,959 £12.00
Cook
Rainton House,
Q2 2015 N Power 217,339 £12.00
Rainton Bridge, Sunderland
Cobalt 9B, North Tyneside,
Q4 2014 Siemens 40,000 £15.75
Newcastle upon Tyne
In addition, the adjoining Capita call centre totalling approximately 150,000 sq ft
was let off a rent of £12.25 per sq ft on commencement of the lease term in 2006.
INVESTMENT MARKET
The regional long income investment market continues to attract strong interest from a diverse range of
domestic and international investors. Notable recent transactions with RPI rent reviews include:
Size Rent AWULT
Date Address Tenant Price NIY Comments
(sq ft) (psf) (break)
Discovery House, Annual RPI reviews collared
Nov-18 Capita Plc 25,184 £15.24 19.4 £6.545m 5.50%
Nottingham at 1% and capped at 4%.
Capita Business 5 yearly RPI reviews collared
Oct-18 Britannia House, Leek 92,344 £8.12 18.7 £11.520m 6.10%
Services Ltd at 0% and capped at 3.5%.
Preston Brook Contact
Capita Business Annual RPI reviews collared
Feb-18 Centre, Chester Road, 158,471 £11.64 23 £40.00m 4.41%
Services Ltd at 0% and capped at 3%.
Runcorn
1 Sovereign Street, 5 yearly RPI reviews collared
Aug-18 BT 139,079 £19.20 17.25 £49.55m 5.42%
Leeds at 1% and capped at 3%.
Statoil House, Prime
5 yearly reviews - 2.5% per
Jan-18 Four Business Park, Statoil (UK) Ltd 45,797 £26.75 12 £18.70m 6.17%
annum compounded.
Aberdeen
Sonova House,
Sonova UK RPI reviews collared at 2%
Dec-17 Lakeside Drive, 43,392 £17.28 10.5 £12.76m 5.50%
Limited and capped at 4%.
Warrington
Hartshead House, Capita Business Annual RPI reviews collared
Jun-17 61,645 £17.00 22 £20.20m 5.00%
Cutlers Gate, Sheffield Services Ltd at 0% and capped at 3%.
Office 3, Bridgehead GB Gas RPI reviews collared at 1%
Jun-17 17,500 £16.48 15 (10) £4.48m 6.35%
Business Park, Hessle Holdings Ltd and capped at 4%.
C PIT HOUSE
B R O O K F I E L D S PA R K , D E A R N E VA L L E Y, R O T H E R H A M S 6 3 5 DJ
VAT PROPOSAL FURTHER INFORMATION
The property is elected for VAT and it is assumed that the We are instructed to seek offers in excess of £25,700,000 JOHN ELLISON
sale will be treated as a Transfer of Going Concern (TOGC). (Twenty Five Million, Seven Hundred Thousand Pounds), Tel: 020 7493 3330
subject to contract and exclusive of VAT. Mob: 07889 437 236
Email: jellison@lewisellis.co.uk
EPC A purchase at this level represents a net initial yield of 6.25%
equating to an equivalent yield of 7.05%*, after allowing for
The property has an EPC rating of D and a score of 99. A copy JAMES CADDICK
purchaser’s costs of 6.76%. This reflects a low capital value
of the EPC certificate and recommendation report is available Tel: 020 7493 3330
of £189 per sq ft.
on the data room. Mob: 07771 882 860
Email: jcaddick@lewisellis.co.uk
*The equivalent yield assumes RPI growth of 3% p.a. for the
DATA ROOM duration of the term
JAMES ELKINGTON
There is a data room for the property containing key tenancy Tel: 020 7493 3330
information, title documents and EPC certificates. Access is Mob: 07810 722 459
available upon request. Email: jelkington@lewisellis.co.uk
Lewis Ellis LLP for themselves or nominees or lessors of this property whose agents they give notice that: (1) the particulars are set out as a general outline only for the guidance of the intending purchasers or lessees, and do not constitute part of an offer or contract; (2) all
descriptions, dimensions, references to condition and necessary permissions for use and occupation, and other details are given in good faith and are believed to be correct, but any intending purchasers or tenants should not rely on them as statements or representations
of fact but satisfy themselves by inspection or otherwise as to the correctness of each of them; (3) no person in the employment of Lewis Ellis LLP has any authority to make or give any representation or warranty whatever in relation to the property. Designed and Produced
by Creativeworld. Tel: 01282 858200. April 2019.You can also read
