1650 Parkway, Solent Business Park, Whiteley, Fareham, PO15 7AH
Asset purchased for £1.4m with a 10 year lease at £140,000 pax to Ramp Industries, a long established precision engineering company.
Following the BREXIT Referendum the tenant started getting into financial trouble due issues with their principle customer, Italian owned Westland Helicopters, and eventually fell into administration. A consortium of investors bought out the company on the basis the fundamentals were relatively strong. Craigard supported the Consortium in order to protect their own investors interests.
Despite struggling on for a couple of years ultimately the Company went into liquidation. However Plan B upon purchase, given the prominence of the building to the main road, was always a refurbishment and subdivision of the building targeting trade counter occupiers.
Aware that the tenant was likely to fold, Craigard worked up a refurbishment programme and commenced marketing. Soon after, Tileflair expressed interest and signed up to a pre-let of 5,000 sq. ft. at £10. psf. Subject to planning. Once the pre-let had exchanged Craigard commenced the £900,000 refurbishment project splitting the building into five smaller unit. Investors supported the project with additional funding.
The initial works completed in June following which Tileflair took occupation. During the build process, another deal was also agreed with electrical wholesaler Rexel for another 5,000 sq. ft. at £10.00 psf which completed in July. At the same time, an agreement was made with Greggs for a lease of 1,200 sq. ft. subject to planning which was approved in late 2019.
Greggs took occupation in February which left two units (50%) still remaining vacant. The pandemic hit and Craigard worked with the tenants to nurse them through a tough time. Marketing stalled due to lock down.
Tapi Carpets agreed terms on the remaining two units, subject to planning, concluding the business plan for Craigard. In tandem with the final letting, Craigard agreed an off market sale of the asset to a property company at £3.85m / 5.5% NIY. Despite a long and tough road with this asset and injecting additional equity for the refurbishment, Craigard still managed to deliver a 15% PA return to investors over a seven year hold.