DHL Stanton, Shepherds Grove Industrial Estate, Bury St. Edmunds, Suffolk, IP31 2BG

Property specification

• The property comprises of 23 warehouses including one office, two cottages and 7.33 acres of land, the majority of which is concrete hardstanding
• Secure site of 33.10 acres with an additional 7.33 areas of land, reflecting a total area of 40.43 acres and a site density of approximately 45.5% (exclusive of the land) and 37.2% (inclusive of the land)
• Total floor area of approximately 664,027 sq ft (60,033 sq m)
• An adjacent site is being promoted for substantial mixed-use development of 1,750,000 sq ft of floor space under new Supplementary Planning Guidance
• Sale and leaseback to DHL Supply Chain Ltd on a new 5 year lease on completion of the sale. The lease will be subject to a tenant's break option at the end of year 2, 3, 4 (subject to 12 months notice)
• Initial rent will be £1,802,244 per annum (averaging a low base of £2.71 per sq ft)
• DHL (and its predecessors) have occupied the site for approximately 30 years and are currently operating approximately 17 contracts from the property, as well as utilising the site as an overflow facility
• DHL Supply Chain has a 5A1 D&B Rating, indicating a minimum risk of business failure
• Multiple future asset management initiatives are available to add value through: masterplan future redevelopment, partial redevelopment, refurbishment of existing units, break up for owner occupier sales, creating a multi-let industrial investment asset to enhance rental levels and capital value
• £14,675,000 / NIY 11.50%

Lease terms

We are instructed to seek offers in excess of £14,675,000, subject to contract and exclusive of VAT for our client's freehold interest in the property. This equates to a low capital value of £22.10 per sq ft. A purchase at this level reflects a net initial yield of 11.50%. As the proposed transaction structure can not be treated as a Transfer of a Going Concern, we have calculated purchaser's costs to be 7.73%. The price equates to a low £363,000 per acre.