At asking £420,000 the net initial yield on the current £25,176 NOI is 6.0%, below the 8% to 10% lenders look for on secondary commercial. A standard 65% LTV facility becomes hard to place at asking; the methodology range sits 42% below.
Stress DSCR at the upper end is 1.11× (Marginal). If commercial rates rise to 10%, debt service consumes most of the current NOI; the cushion comes only from letting the vacant stores and re-basing the informal rents.
Offer explorer
Lender lens · five ratios
65% LTV · 8% IO · 7% costs · NOI £25,176 · VP £350,000 (lender basis) · Refurb-to-let £10,000 (£10,000 EPC/compliance works floor, vacant central stores re-let as shell)
Glenburn House is a standalone, multi-tenant industrial-estate unit let to five occupiers on informal, short-term agreements that all expire by June 2026, alongside one vacant store. It produces £33,555 of contracted gross rent (£25,176 net of landlord costs), an 8.0% gross yield at the £420,000 asking. The deal is an operational reposition: the income exists but is under-managed and under-documented, so value comes from formalising the tenancies onto written leases, letting the vacant stores, and re-basing rents toward market on renewal, rather than from any change of use. On the current contracted income, a 65% LTV facility supports a purchase in the £235,000 to £245,000 range at a 20% to 15% cash-on-cash hurdle, which is 42% below the £420,000 asking. The vendor frames the asking as the vacant-possession valuation with the income and the solar Feed-in-Tariff contract as a free premium; on a 9.0% all-risks yield applied to the actual income, the methodology valuation does not reach the asking. The reversionary upside (letting the stores, re-basing informal rents) and the solar income are real but unverified, and would need to be contracted to close the gap.
Facts, condition, comparables, valuation stack, and purchase-cost schedule for due-diligence reference.
| Address | Glenburn House, 1 Bairds Crescent, Allanshaw Industrial Estate, Hamilton, ML3 9FD |
|---|---|
| Asking | Offers Over £420,000 (off-market; vendor states aligns with vacant-possession valuation) |
| Property type | Mixed-use commercial: two-storey office pavilion (2,095 sqft), central stores (1,471 sqft, vacant), main workshop (2,672 sqft, double roller-shutter). Standalone site with dedicated secure yard. |
| Area | Stated GIA 6,436 sqft (597.92 sqm). NIA estimated 5,471 sqft (×0.85 GIA haircut). Office 1,781 / stores 1,250 / workshop 2,271 NIA. |
| Tenure | Not disclosed in the pack. Scottish commercial premises typically heritable; confirm at title. |
| Passing rent | £33,555 pa across five informal tenancies (SMS £13,695, MAQ £8,160, GM Lux £6,300, EAL £4,080, Vision £1,320). Gross yield 8.0% at asking. |
| Vacancy | Central stores (1,471 sqft GIA) vacant. All occupied tenancies informal / short-term, expiring June 2026. |
| Secondary income | 14kW solar array, back-to-grid Feed-in-Tariff at 45p/kWh, 8 years remaining (non-operational income stream). |
| Location | Allanshaw Industrial Estate, Hamilton (South Lanarkshire), circa 9 miles SE of Glasgow. M74 connectivity via A723/A725. Resident population circa 55,000. |
| Agents | Commercial Investors Ltd (private, off-market, not for circulation; issued 15/05/2026) |
| Buyer fee | 3% of purchase price (minimum £3,000), payable to the introducer. |
No photographs supplied in the off-market pack beyond the cover street-view image.
| Occupier | Annual rent | Status |
|---|---|---|
| SMS (owner-occupier) | £13,695 | Incl. utilities; open to sale-and-leaseback (proposed £20,000 on 5-yr term) |
| MAQ | £8,160 | Incl. utilities |
| GM Lux | £6,300 | Excl. utilities |
| EAL | £4,080 | Excl. utilities |
| Vision | £1,320 | Excl. utilities |
| Central stores | £0 | Vacant (1,471 sqft GIA); vendor claims circa £10k uplift on letting |
| Gross passing rent | £33,555 | Five informal tenancies |
| Less insurance | −£2,400 | £200/mo |
| Less management | −£3,356 | 10% multi-tenant |
| Less utilities (incl-utility lets) | −£2,623 | 12% of SMS + MAQ rents |
| Net operating income | £25,176 | Actual, current |
Vendor-claimed prospective income (SMS leaseback uplift to £20,000 pa; circa £10k on the vacant stores) is treated as unverified and excluded from NOI per methodology; it appears here for context only.
Selected ARY: 9.0%. Hamilton is a weak-secondary Central Belt town. The asset is a part-let, multi-tenant industrial-estate unit on informal sub-1-year tenancies. Industrial secondary yields in the Central Belt run 7% to 9% (Ryden 2025); the weak-secondary location, the short and informal lease profile, and the owner-occupier leaseback dependency place this at the top of that band. The lot is sub-£500k but income-producing, so no small-lot premium is added (income status rule). Rounded to the nearest 25 bps.
| Yield | Value on £25,176 NOI |
|---|---|
| 8.5% | £295,000 |
| 9.0% (selected) | £280,000 |
| 9.5% | £265,000 |
Term yield 8.25% (ARY −75 bps). Reversion yield 9.0%. Source: Ryden 90th Scottish Property Review 2025 (industrial Central Belt); PropLens secondary-commercial benchmarks.
| Basis | Value | Workings |
|---|---|---|
| Rack rent (ERV / ARY) | £370,000 | Whole-building ERV £33,098 ÷ 9.0% |
| VP / MV3 (lender basis) | £350,000 | Rack less 18-mo void + 6-mo rent-free + reletting + holding on the vacant portion |
| MV1 stabilised (income) | £325,000 | Stabilised NOI £29,103 ÷ 9.0% (current let + stores let) |
| 180-day restricted | £295,000 | MV1 × 0.90 |
| 90-day restricted | £260,000 | MV1 × 0.80 |
| Asking | £420,000 | Offers Over; vendor states aligns with VP |
ERV split (space-type carve-out): office 1,781 × £9.99 × 0.85 = £15,123; workshop 2,271 × £5.95 = £13,512; stores 1,250 × £5.95 × 0.60 storage = £4,463. Total £33,098. The vendor's "asking = VP" claim implies a sub-9% yield on the actual income; the methodology VP on a 9.0% ARY is £350,000.
Hamilton indicative capital value benchmark: £118 to £156/sqft for sub-3,000 sqft town-centre units (PropLens, derived from Ryden 2025 yields), flagged CAUTION for office competition. This 6,436 sqft industrial-estate unit is a different and larger lot type, so the town-centre benchmark is contextual only. Asking equates to £65/sqft GIA (£77/sqft NIA), below the town-centre retail/office benchmark, which is consistent with its industrial-estate character and larger lot size.
| Item | @ asking £420,000 | @ upper £245,000 |
|---|---|---|
| LBTT (Scotland, non-resi) | £9,500 | £950 |
| Legal fees | £4,500 | £4,500 |
| Disbursements | £650 | £650 |
| Broker (1%) | £4,200 | £2,450 |
| Lender arrangement (2% of loan) | £4,550 | £4,550 |
| Lender legal | £2,500 | £2,500 |
| Surveys / DD | £2,000 | £2,000 |
| Total purchaser costs | £27,900 | £17,600 |
| Refurb to let (1 vacant unit, EPC floor) | £10,000 | £10,000 |
| Off-market buyer fee (3%, min £3,000) | £12,600 | £7,350 |
The 3% off-market introducer fee is additional to standard purchaser costs and reduces the effective bid.
Value-add angles, holding-structure recommendation, and supporting analyses for the bid thesis.
The asset is commercial and SSAS-eligible (mixed office/industrial). A SSAS or company SPV suits a long-term income hold: rental income and gains are tax-free inside a SSAS, and the active-management element (re-letting, lease formalisation) sits comfortably in a PropCo. If the SMS sale-and-leaseback proceeds, the connected-party rent must be RICS-assessed market rent to avoid an unauthorised-payment charge.
Operational reposition Off-market Part-let industrial
Scotland