Track Record


 

first avenue, maybrook ind est, minworth

Challenge

On behalf of the owner of both the building and the company occupying it, Darby Keye Property were mandated to dispose of the freeholder interest in the property with the existing lease to the occupier still in place i.e. a “sale and leaseback”.

The existing FRI lease had in excess of 11 years remaining on the term, however not all of the terms within the lease were ‘institutionally acceptable’ due the relationship between the landlord and the occupier.

The building comprised a self-contained ‘standalone’ 45,000 sq ft industrial warehouse / production unit constructed in the 1980’s. It was specified with a steel portal frame warehouse including 6m eaves, integral office accommodation, and a secure external loading yard and car parking.

Strategy

  • Understand the client’s aspirations in respect of both the sale price and lease terms. Consider the balance between the financial costs of the lease to the business and the sale price likely to be achieved
  • Advise on current market conditions and ‘investor’ appetite for this type of product
  • Appraise existing lease terms and advise on the term variations needed to meet investor requirements
  • Advise on the level of rent that will make the opportunity attractive to investors and ensure the desired sale price can be achieved
  • Advise on the strengths and weaknesses of the opportunity and the type of Investor it will appeal to
  • Compile an information pack comprising title report, plans, pictures, copy of existing lease, proposed variations to the existing lease and covenant information
  • Advise on the most suitable route for a successful disposal – in this instance an ‘off market’ approach to a pre-determined list of investors was deemed most appropriate due to the ‘lot size’, covenant and specification of the property
  • Seek offers from those interested in the opportunity
  • Agree sale price, prepare and negotiate Heads of Terms and instruct lawyers
  • Oversee legal process through to successful completion

Outcome

Darby Keye Property successfully secured an ‘off market’ sale of the property to a London based Commercial Property Investment Company. The sale price met the client’s aspirations whilst maintaining lease costs that were acceptable to them as a tenant.