Property consultancy Alder King, acting on behalf of Cornish construction and development company BBCB Ltd, has completed the investment sale of three character properties in Penzance to private investors. Following the successful disposal of these properties, Alder King is now marketing the residential investment of five flats at 70 Causewayhead in Penzance on behalf of the same client.
The first of the properties sold was the former Primrose Dairy on Belgravia Street which was recently refurbished to provide two commercial units on the ground floor and eight apartments on the first floor, each of which pays an annual ground rent of £200. Alder King secured the freehold sale for £150,000, reflecting a net initial yield of 12.1% yield on the ground floor office accommodation and a 7% yield on the residential ground rents.
One of the ground floor units is let to Pearsons Driving Assessments Ltd at £8,000 per annum on a lease expiring in March 2021; the second unit was let to Cornwall Council at a rent of £8,000 per annum.
The freehold of The Bakehouse, a recently developed retail and residential property on Bread Street, has also been acquired a private investor. The property includes three retail units generating £26,500 of rental income and 10 apartments at first and second floor level all sold on 999 year leases at a ground rent of £250 pa each. The sale for £220,000 represents a 12.5% net initial yield on the retail investment and a 7% yield on the residential ground rents.
All three retail units are let to independent retailers on 15 year leases expiring in 2022 at £8,000 per annum. Units 1 and 2 each provide 774 sq ft of space while Unit 3 provides 631 sq ft of space.
The third property is 13/14 Market Place Penzance which is let to a variety of tenants producing a rent of £54,000 pa. The property was sold for £457,000 which equates to a net initial yield of 11.16%. The local purchaser intends occupying the vacant office suite within the building.
These transactions follow the completion of the sale of 61-62 Chapel Street at the very end of 2012., This imposing Victorian corner building currently houses the Chapel Street Antiques Market. The ground floor and basement generate an established income while the first, second and third floors are to be vacated and have potential for conversion, subject to planning. The 7,602 sq ft property was sold to local purchasers at a net initial yield reflecting approximately 9.4% before accounting for the development potential in the upper floors.
Tom Duncan, associate at Alder King in Truro, said: “We are pleased to have secured the sale of these four properties. They confirm that Penzance retains its appeal to investors looking for opportunities with good yields.”
