Northgate Darlington – Purchased December 2013
An opportunist buy inside two weeks of a property that failed to sell at auction, these three retail units are directly opposite Marks & Spencer's, and were acquired for £1.05 million at a 12.75% initial yield. Tenants are Macdonalds, British Heart Foundation and YMCA on a temporary let.
Lloyds provided £500K of debt, with the remaining balance coming from investors.
In the first couple of months of ownership a deal was agreed to relocate British Heart Foundation at an improved rent on a 10 year lease term. Works were then completed to enhance the appearance of the building.
MacDonalds exercised a break in 2016 and a dilapidations claim has just been concluded. Marketing of the vacant unit has suffered due to a very lack lustre northern retail market. The small kiosk has been let to a local ice cream company.
Negotiations are in hand to acquire land to the rear of the site for residential development which will also include the upper parts of the retail frontage.