As a leasehold site, it did not make financial sense for a short term investment but the client wanted to make more of this low turnover garden centre. Hammond Phillips was asked to advise on the valuation implications and to suggest ways forward for a prime six acre site in Gloucester.
- Produced a valuation of the existing leasehold interest, together with a valuation of the site, which confirmed that constructing a new garden centre would not be financially viable.
- Recommended approaching the freeholder from which an option agreement was subsequently agreed for a conditional purchase.
- Advised that planning permission should be obtained to provide a development which would have stronger investment values in the long term.
- As a consequence a new planning application was submitted and consent was granted for a 40,000 sq.ft., modern, purpose built garden centre with a further 20,000 sq.ft. of adjoining concession units.
- Approached and obtained an investment funding with Blooms taking an overriding lease of the whole development.
- Sub-let the four units to complimentary retailers, including Laura Ashley.
This was the first time that a sale and leaseback had been achieved within the garden centre sector. The price achieved was significantly higher as a result of the four concession units achieving a substantial development profit for the client.
The Garden Centre opened in April 2005 with sales significantly ahead of year one budgets.
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