• An opportunity to redevelop and re-purpose a well-located hybrid manufacturing unit just to the south of Glasgow.

• The unit measured circa 55,000 sq ft which included a high office content, large concrete mezzanine floor and large monobloc car park to the rear.

• It had had been used for light industrial / manufacturing purposes; a specialist use for which there are few occupiers.

• This building had been modified to the vendor’s specification and, in order to have a broader appeal to the occupier market, it required a substantial redesign.

• Rankeilour re-designed the unit to remove the mezzanine floor, reduce the office footprint by removing the first-floor offices, insert two further loading doors and install a new secure concrete yard in part of the car park.

• Whilst the new design reduced the floor area to 34,529 sq ft (a 37% reduction), the aim was to increase the appeal leading to competitive tension from potential occupiers that would improve the rent. 

• During the acquisition process, a contractor was chosen to undertake the redevelopment works immediately on completion, at a cost of £950k.

• There was strong occupational interest during the redevelopment, which resulted in terms being agreed to let the unit to Galaxy Insulation Ltd on a 15 year lease at £293,000 per annum, 21.5% ahead of the ERV in our appraisal) with 5 yearly uncapped CPIH rent reviews.

• The asset was then sold in under a year from acquisition for £4.45m, reflecting a profit on cost of 37.8% and an IRR of 44.0%.