PropLens · 38 Barnton Street, Stirling, FK8 1NA

Offer range · Income hold (vacant, re-let)

Opening Bid £55,000

Asking (opening bid)

Auction teaser; reserve/hammer undisclosed

Upper end sits +£10,000 above the opening bid (15% cash-on-cash)

£65,000

TargetUpper end · 15% c-on-c hurdle

vs opening bid

+£10k

Step down −£10,000 · −15% to the £55,000 floor (20% cash-on-cash)

£55,000

Lower end · 20% c-on-c floor

vs opening bid

= bid

Range £55,000 – £65,000 Bid band · At floor opening bid lands at the 20% cash-on-cash floor

The £55,000 figure is an auction opening bid, not a guide or reserve. Auction clearing prices commonly exceed the opening bid; above about £65,000 the deal falls below the 15% cash-on-cash hurdle.

Several units on the same Barnton Street parade are marketed to let. The 12-month void assumption could prove optimistic if local occupier demand is soft.

Computed loan is £42,250, below mainstream commercial mortgage minimums (typically £100k–£150k). The lender ratios are shown against a notional loan that may not be obtainable.

Stabilised income

£10,000/ yr NOI

£10,000 ERV − £0 op. costs → NOI

Vacant; ERV from comparable lease evidence (no contracted rent). Year-1 cash-on-cash lower until let.

Cost to stabilise

£18,000one-off refurb

£25/sqft cosmetic refresh + flooring (ground floor) plus basement make-safe

Funded with the purchase — already in equity required on the explorer.

Offer explorer

Your offer

£65,000

Equity required

£0

Lender lends £42,250 against VP £65,000

Cash-on-cash

DSCR @ 8%

2.96×

Same at any price

Net cash flow

£6,620

NOI − debt service (fixed)

Lender lens · five ratios

DSCR @ 8% rate 2.96× Strong

Stress DSCR @ 10% rate 2.37× Strong

Debt Yield (NOI / Loan) 23.7% Strong

Yield on Cost 0% Viable

Net Initial Yield 0% Viable

65% LTV · 8% IO · 7% costs · NOI £10,000 · VP £65,000 (lender basis) · Refurb-to-let £18,000 (£25/sqft cosmetic refresh + new flooring, ~600 sqft ground floor; basement make-safe)

Thesis

A vacant retail unit on a secondary Stirling pitch, offered through a timed online auction with a £55,000 opening bid. The unit comprises a ground-floor shop in fair order over a rough, partly damp basement used for storage. On comparable lease evidence the property supports an estimated rental value of roughly £10,000 a year; there is no contracted income, and the vendor's quoted £10,000–£12,000 figure is treated as an unverified marketing claim. At the opening bid the implied returns clear the 20% cash-on-cash floor, and the methodology range is £55,000 to £65,000. The headline figure is an opening bid rather than a guide or reserve, so the price that actually clears the room is the variable that matters: above about £65,000 the deal slips below the 15% cash-on-cash hurdle. Re-letting is the central question, with competing vacancy visible on the same parade, though the £5,100 rateable value gives an occupier 100% small-business rates relief, which supports both lettability and owner-occupier appeal.

What's wrong with it

Vacant on a secondary pitch, with several competing "to let" units on the same Barnton Street parade.
Basement is rough and shows damp staining; storage-grade only, with possible tanking cost and limited lettable value.
Ground-floor flooring is stripped to the subfloor and the kitchenette is dated; refurbishment is needed before letting.

What's right with it

Priced at auction below vacant-possession value; the opening bid lands at the income floor.
Rateable value £5,100 qualifies an occupier for 100% small-business rates relief: effectively rates-free occupation.
Ground floor presents reasonably (suspended ceiling, panel lighting) in a central Stirling location near the rail station with passing trade.

Risks

Auction clearing price typically exceeds the opening bid; above about £65,000 returns fall below the 15% cash-on-cash hurdle.
Letting risk: visible competing vacancy on the parade signals soft demand; void could exceed the 12-month assumption.
Condition: basement damp and general wear could absorb more than the £18,000 refurbish-to-let allowance.

DD gaps

Floor area: none published; NIA assumed ~1,200 sqft from photographs. Commission a measured survey.
Auction terms: reserve, buyer's premium, and completion timetable undisclosed; confirm before bidding.
Building survey: basement damp/tanking, electrics, roof/structure, EPC band, and title burdens.

Considerations

Rates relief: RV £5,100 qualifies for 100% small-business rates relief (Scotland), a genuine occupier incentive.
Auction purchase: immediate funds and a short (~28-day) completion window limit the due-diligence period.
Loan size £42,250 sits below mainstream commercial mortgage minimums (typically £100k–£150k). Realistic structures: cash, SSAS (50% LTV, see footnote), specialist small-ticket lender, or bridge-to-stabilisation. The lender ratios are computed against a notional loan and may not be obtainable in practice.

SSAS variant · commercial, eligible At 50% LTV (SSAS borrowing cap) the range solves to £50,000 – £60,000 on the same 20% / 15% cash-on-cash hurdles. Retail held as commercial qualifies for tax-free rental income and gains within a pension wrapper; at this lot size, annual SSAS administration cost should be weighed against the benefit.

Quick facts

Asking: £55,000
Basis: Auction opening bid
NIA (est.): ~1,200 sqft
£/sqft: ~£46
Tenure: Heritable (to confirm)
Condition: Fair
RV: £5,100
Tenancy: Vacant
Portal: Prime Property Auctions
Agent: Prime Property Auctions

Headline numbers

Range: £55k – £65k
Opening bid: At 20% floor
NOI (ERV): £10,000
Refurb to let: £18,000
All-in @ upper: £87,550
DSCR @ 8%: 2.96×
VP (lender basis): £65,000
SSAS range: £50k – £60k

Property & Valuation

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

Facts

Field	Value
Address	38 Barnton Street, Stirling, FK8 1NA
Asking	£55,000 (auction opening bid)
Type	Retail (ground floor + basement)
NIA (estimated)	~1,200 sqft
Tenure	Heritable (to confirm)
Condition	Fair
Rateable value	£5,100
Tenancy	Vacant
Portal	Prime Property Auctions
Listing	View listing

Accommodation per listing: entrance/retail area, back room, kitchen area, basement, wash area, additional storage, WC, side access. No floor area published.

Photos

Physical assessment

Exterior: traditional sandstone tenement parade; ground-floor shopfront with display window and separate access. Sound but weathered stonework.
Ground floor: open retail room with suspended ceiling and LED panels; presents reasonably. Floor stripped to plywood subfloor (new covering needed).
Rear: back room, dated kitchenette (stainless sink, old units, cracked splashback), wash area, and WC.
Basement: large, accessed by concrete stair; bare concrete floor, painted brick/stud walls, exposed former fireplace with rust/damp staining. Storage-grade; damp evident.
Street scene: secondary Stirling pitch near the rail station; passing trade but several competing "to let" units on the same parade.
EPC: not stated; commercial unit of this age and condition likely mid-band (D–E). DD item.

Per-unit income

Area	NIA (sqft)	£/sqft	ERV
Ground floor retail	~600	£12.10	£7,260
Basement (storage)	~600	£4.50	£2,740
Total ERV	~1,200		£10,000

Ground rate: Stirling small-unit lease median £14.23/sqft × 0.85 (Fair condition). Basement carved to £4.50/sqft (sub-grade, damp, storage only), below the standard 50% sub-grade carve to reflect condition. Vendor's £10,000–£12,000 claim is unverified marketing; the methodology ERV is derived independently and sits at the lower end of that claim.

Yield selection

Sector: retail. Location: secondary Stirling pitch (Barnton Street, near rail station, not the prime Port Street / Thistle core). Quality: secondary, with visible parade vacancy.

Selected ARY: 11.75%. Neighbourhood/secondary retail prime band 9–11% (midpoint 10%), plus the +175 bps sub-£500k lot-size adjustment, rounded to 11.75%. Term yield 11.0%; reversion 11.75%. Property is 100% vacant, so Term & Reversion is not run; valuation is on a vacant-possession basis.

Yield	Capital value (ERV £10,000)
11.25%	£88,900
11.75% (selected, gross rack)	£85,100
12.25%	£81,600

Valuation stack

Basis	Value	Workings
Gross rack (ERV / ARY)	£85,100	£10,000 / 11.75%
Vacant possession (VP / MV3)	£65,000	Rack less 12-mo void, 6-mo rent-free, reletting fee, holding costs
90-day restricted	£52,000	VP-equivalent × 0.80 (lender stress)
180-day restricted	£58,500	VP-equivalent × 0.90
Asking (opening bid)	£55,000	Auction teaser; reserve/hammer undisclosed

VP is the lender basis. The gap between gross rack (£85k) and VP (£65k) is the value consumed by filling the void, the rent-free incentive, reletting, and holding costs on a vacant secondary unit.

Acquisition benchmark

Stirling indicative capital value for sub-3,000 sqft town-centre commercial: £135–£169/sqft (reasonable condition). The opening bid of £55,000 over ~1,200 sqft is ~£46/sqft, well below the benchmark, consistent with a vacant, secondary-pitch unit needing refurbishment sold at auction. A low entry price is not in itself the opportunity: the discount is partly consumed by the refurbishment and void cost to bring the unit to a lettable, income-producing state.

Purchase costs

Item	Amount
LBTT (on £55,000)	£0
Legal fees	£4,500
Disbursements	£650
Broker fee (1%)	£550
Lender arrangement (2% of loan)	£845
Lender legal	£2,500
Surveys / DD	£2,000
Total purchase costs	£11,045
Refurbish to let (separate)	£18,000

LBTT is nil below £150,000. Auction buyer's premium not included (undisclosed). At an auction purchase, allow a contingency above the surveys line given the compressed DD window.

Strategy & Appraisal

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

Value-add angles

Auction acquisition / discountStrong

The opening bid sits below vacant-possession value (£65,000) and at the 20% cash-on-cash floor. If secured at or near the opening bid and let to a single occupier, the income clears the lower hurdle.

Key risk: reserve and hammer price are undisclosed; the room may clear well above the opening bid.

Single-tenant re-let (income)Moderate

Refurbish the ground floor and let to a retail or service occupier at an ERV near £10,000. The £5,100 RV gives the tenant 100% rates relief, improving affordability and lettability.

Key risk: competing vacancy on the parade; void could run beyond 12 months.

Owner-occupier appealModerate

Rates-free occupation (SBBS) and a low capital cost make this attractive to a small-business owner-occupier, which supports both a future exit and the rental demand pool.

Key risk: owner-occupier demand is episodic; not a reliable investment exit.

Alternative use / basementWeak

The damp, sub-grade basement has limited conversion value. Change of use of the ground-floor frontage faces NPF4 town-centre-first policy (which favours retaining commercial use) and there is no permitted-development route in Scotland.

Key risk: planning and conversion cost outweigh uplift at this value.

Holding structure

Retail held as commercial is SSAS/SIPP-eligible: once let, a pension wrapper delivers tax-free income and gains on a long-term hold, though SSAS administration cost is material relative to this lot size. For a leveraged or shorter hold, a personal name or SPV is simpler. Given the loan falls below mainstream commercial minimums, a cash or SSAS purchase is the most realistic structure.

Sources

Prime Property Auctions listing
Scottish Assessors Association — rateable value lookup (RV £5,100, per listing)
Revenue Scotland — LBTT non-residential bands
Ryden Scottish Property Review 2025 — secondary retail yields
Stirling small-unit lease evidence (PropLens market research)

Jurisdiction

Scotland