Palace Capital plc
("Palace Capital" or the "Company")
Acquisition of Retail and Office Building
in Sutton for £3.925 million
Palace Capital, the property investment company, announces that it has completed the acquisition of the entire issued share capital of Dering Properties (Sutton) Limited ("Dering") for a consideration of £3.925 million. The consideration was satisfied from the Company's existing cash resources.
Dering holds the long lease of 46-54 High Street, Sutton, a fully let 21,248 sq ft retail and office building on the corner of High Street and Carshalton Road, approximately 200 metres from Sutton Railway Station.
The property, built in the 1980s, comprises three shops totalling 5,684 sq ft let to Foxtons, Sharps Bedrooms and Nirvana Beauty. The 15,564 sq ft of office space is let to the Sutton Housing Partnership until June 2022 with the London Borough of Sutton guaranteeing the lease.
The property is held on lease from the Mayor and Burgesses of the London Borough of Sutton for a term of 150 years from January 1986 with rent reviews. Current rent payable is £42,906.25 per annum and the property produces a gross income of £356,000 per annum, thus providing a net income of £313,093.75 per annum and a yield of just under 8 per cent.
Neil Sinclair, Chief Executive of Palace Capital, said:
"We are delighted to have made this addition to our portfolio of a fully let property with strong tenants and an attractive yield. Sutton benefits from excellent links into Central London and is, in our view, a growth location.
"The property has excellent potential, and we will be exploring various opportunities in the medium term to create further value for our shareholders through active management."
Date: 17 August 2015
For further information contact:
Palace Capital plc
Stanley Davis, Non-executive Chairman
Neil Sinclair, Chief Executive
Stephen Silvester, Finance Director
Tel. 44 (0)20 3301 8331
Allenby Capital Limited (Nominated Adviser and Joint Broker)
Nick Naylor / James Reeve
Tel. 44 (0)20 3328 5656
Arden Partners plc (Joint Broker)
Chris Hardie / Ciaran Walsh
Tel. 44 (0)207 614 5917
Broker Profile (Financial PR)
Simon Courtenay / Harry Rippon Tel. 44 (0)20 3763 3400