PropLens · 15 Bloomgate, Clydesdale Inn, Lanark, ML11 9ET

Offer range · Income hold

£230,000

£265,000

Lower end · 20% Upper end · 15%

Asking £241,000 sits within the range, closer to the lower end.

Income basis Income basis: actual passing rent (£36,000 pa to November 2028, £40,000 pa thereafter to expiry November 2033) less assumed buildings insurance £2,400 pa.

£36,000 − £2,400 → NOI £33,600

Offer explorer

Your offer

£265,000

Equity required

£0

Lender lends £130,000 against VP £200,000

Cash-on-cash

DSCR @ 8%

3.23×

Same at any price

Net cash flow

£23,200

NOI − debt service (fixed)

Lender lens · five ratios

DSCR @ 8% rate 3.23× Strong

Stress DSCR @ 10% rate 2.58× Strong

Debt Yield (NOI / Loan) 25.8% Strong

Yield on Cost 0% Viable

Net Initial Yield 0% Viable

65% LTV · 8% IO · 7% costs · NOI £33,600 · VP £200,000 (lender basis)

Thesis

The Clydesdale Inn is a substantial 11,000 sqft public house on Lanark's High Street, currently let to 1969MR Ltd until November 2033 at £36,000 pa rising to £40,000 pa from 2028. The lease has approximately 7.5 years certain, with the rental step-up effectively pre-agreed. Asking £241,000 represents a gross rent yield of 14.9% on current rent and 16.6% from 2028. The deal pencils on income alone at conventional 65% LTV. Tenant covenant is the key uncertainty: 1969MR Ltd is a small private company without published financials, and pub-trade income is operationally exposed. The asset itself is leisure-secondary in a weak secondary town, which sustains a high reversionary yield (13.75% ARY) and limits the bid even with strong cash-on-cash at the asking.

What's wrong with it

Tenant covenant is unrated and trade-exposed; pub income is materially riskier than office or retail-multiple income.
Lanark is a weak secondary town with a thin investor pool, which compresses exit liquidity and pushes the reversion yield wide.
Building is configured as a single trading pub; alternative-use options on the trading floors are constrained while the lease runs.

What's right with it

7.5 years of contracted income with a built-in 11% step-up in 2028 covers debt service comfortably from day one.
Prominent High Street frontage in a Royal Burgh of 9,000 residents; the building is a recognised landmark with established trade.
Photos show a well-presented internal fit-out (bar, dining, function room); no immediate capex burden indicated.

Risks

Tenant default risk: 1969MR Ltd accounts and trading history are not in the public listing; landlord exposure if the operator fails before 2033.
Reletting risk: a vacant 11,000 sqft pub in Lanark would face a thin tenant pool and likely 12+ month void.
Repair and FRI scope: lease wording (full repair vs schedule of condition) determines whether dilapidations cost falls on landlord at expiry.

DD gaps

Lease document, schedule of condition, rent review pattern, repair clauses and break options.
Tenant covenant: 1969MR Ltd Companies House filings, trading history, personal guarantee status.
EPC, rateable value, asbestos register, and any historic licensing or planning restrictions on the listed property.

Considerations

Lanark Conservation Area covers Bloomgate; external alterations and signage require conservation consent.
Scottish licensing regime (Licensing (Scotland) Act 2005) attaches the premises licence to the operator, not the freehold; renewal is at the licensing board's discretion.
Pubs are SSAS-eligible commercial under HMRC rules; tax-free hold within a pension wrapper changes the after-tax economics materially.

SSAS variant: at 50% LTV (pension borrowing cap), the indicative range narrows to £215,000–£255,000. Income is tax-free within the wrapper, so after-tax cash-on-cash is materially higher than the conventional structure for 40%+ rate taxpayers.

Property & Valuation

Facts, condition, comparables, valuation stack, and purchase-cost schedule for due-diligence reference.

Facts

Address	15 Bloomgate, Clydesdale Inn, Lanark, ML11 9ET
Asking price	£241,000
Property type	Public house (tenanted investment)
Size	11,000 sqft GIA, 9,350 sqft NIA estimated (×0.85)
Tenure	Freehold
Tenant	1969MR Ltd
Lease expiry	15 November 2033
Passing rent	£36,000 pa
Stepped rent	£40,000 pa from 2028
WAULTC	~7.5 years
Agent	Jeremy Griffith (0141 538 0196)
Portal	Novaloca
Postcode area	ML (Scottish — LBTT applies)

Photos

Physical assessment

Three-storey traditional whitewashed coaching-inn-style building with prominent High Street frontage and clear signage.
Ground floor in commercial pub use: lounge bar, dining area with traditional banquette and tartan-carpet fit-out, separate games room with pool table.
Bar back-of-house in working order, multiple dispense fonts, dishwasher and prep area visible.
Upper floors not visible in marketing material; potential ancillary or function space, possible flat conversion subject to lease and planning.
External condition presents as Fair: paintwork tired in places, some signage age, no visible structural issues.
Surroundings: town-centre street with bunting, neighbouring active retail and the historic Tolbooth steeple in view; pedestrian footfall typical of a market town.

Per-unit income

Period	Rent	Yield on asking
Current to Nov 2028	£36,000 pa	14.9% gross
Nov 2028 to Nov 2033	£40,000 pa	16.6% gross
Landlord costs (assumed)	£2,400 pa	insurance only; FRI lease assumed
Net Operating Income	£33,600 pa	13.9% net on asking

Yield selection

Selected ARY: 13.75%

Lanark sits in the "Other small towns" tier in the Ryden 2025 Scottish yield framework. Leisure / neighbourhood retail secondary yields range 11-13% in this tier. Midpoint is 12%. Adding the +175 bps hardcoded sub-£500k lot-size premium gives 13.75% (rounded to nearest 25 bps). Term yield is 13.00% (ARY less 75 bps).

Cross-check: pub investments at this size and location are not transacted in the published Ryden tables (those cover £5m+ deals). Acuitus and Allsop auction archives show similar tertiary-town tenanted pubs trading at 13-16% gross. A 13.75% ARY sits in the lower-middle of that range, reflecting a 7.5-year lease with stepped rent.

ARY	Rack value	vs selected
13.25%	£271,698	+3.8%
13.75%	£261,818	selected
14.25%	£252,632	-3.5%

Valuation stack

Basis	Value	Workings
Rack rent (gross)	£261,818	£36,000 / 13.75% ARY
VP (MV3)	£200,000	Rack less 12mo void, 6mo rent-free, 10% reletting, holding costs
Term & Reversion	£245,000	Term £166,192 (£36k × YP 7.5 @ 13%) + Reversion £80,989 (deferred 9.0y @ 13.75%)
MV1 stabilised	n/a	Income deal — same as T&R
180-day restricted	£220,500	T&R × 0.90
90-day restricted	£196,000	T&R × 0.80
Asking	£241,000	-1.6% vs T&R

Acquisition benchmark

Lanark is not in the PropLens acquisition-benchmark table. For context: £22/sqft GIA is below £25/sqft, characteristic of secondary leisure-use stock in tertiary Scottish locations. Pub investments are typically valued on income, not £/sqft.

Purchase costs

Item	Amount
LBTT (£91k × 1%)	£910
Legal fees	£4,500
Disbursements	£650
Broker fee (1%)	£2,410
Lender arrangement (2% of 65% LTV)	£3,133
Lender legal	£2,500
Surveys & DD	£2,000
Total purchase costs	£16,103 (6.7%)

Strategy & Appraisal

Value-add angles, holding-structure recommendation, and supporting analyses for the bid thesis.

Value-add angles

Income hold (primary)

Acquire on income basis. 7.5 years of FRI-assumed lease at £36k → £40k covers 65% LTV debt at ~3.2× DSCR with all five lender ratios in Strong. The asking sits within the income-justified range.

Max purchase: £265,000 (15% c-on-c) / £230,000 (20% c-on-c). Risk: tenant covenant.

Viability: Strong.

SSAS hold

Pubs qualify as commercial property under HMRC rules and can be held in a SSAS for tax-free rental income and capital gains. At 50% LTV, the income-justified range narrows but after-tax economics improve materially for higher-rate investors.

Max purchase (SSAS): £255,000 (15% c-on-c) / £215,000 (20% c-on-c). Risk: SSAS admin overhead and connected-party scrutiny.

Viability: Strong for pension-eligible investors.

Vendor finance / lease purchase

Tenanted investment with stable income; vendor unlikely to need full cash. A deferred-completion or vendor-finance structure would defer LBTT and reduce day-1 equity. Requires motivated vendor.

Viability: Moderate — requires negotiation, no evidence of vendor flexibility.

Reversionary value-add (post-2033)

On lease expiry the property reverts to vacant or to a re-let at then-market rent. Upper floors may permit residential conversion (subject to Conservation Area consent and Scottish use class 11 → 9 change-of-use). 11,000 sqft of upper-floor footprint is a long-dated optionality, not a day-1 angle.

Viability: Weak in current hold horizon; Moderate as exit optionality.

Holding structure

Two structures are appropriate. SSAS (pension) if the investor has scheme assets sufficient to support a 50% LTV purchase; rental income and any capital gain are then tax-free within the wrapper, which materially improves after-tax economics on a hold of this duration. Limited company (SPV) as the conventional alternative: 65% LTV available, mortgage interest fully deductible, and dividend planning at exit. Personal name purchase is not preferred for a higher-rate taxpayer given the loss of mortgage interest relief.

Sources

Novaloca listing 293982 (accessed via PropLens extension)
Ryden 90th Scottish Property Review 2025 — yield framework
Knight Frank Scotland Report 2025
Revenue Scotland LBTT non-residential bands (frozen 2026-2027 budget)
Companies House (1969MR Ltd) — DD pending
South Lanarkshire Council Local Development Plan 2 — Lanark Conservation Area

Jurisdiction

Scotland