Market Opportunity

Torquay is a seaside town in Devon located in the district of Torbay, approximately 35 km (22 miles) south of Exeter and 53 km (33 miles) east of Plymouth.

The town benefits from good road communications, being served by the A380 which in turn links with the M5 Motorway approximately 29 km (18 miles) to the north.  The town is also connected to the national railway network with a fastest journey time to London Paddington of 2 hours 45 minutes.   Exeter Airport is some 42 km (21 miles) to the north-east and serves a number of UK and European destinations.  

Torquay forms part of the ‘English Riviera’ and is a popular tourist resort, attracting a large number of visitors each year.  Situated on the South Devon Coast, the town is famous for its sandy beaches and family attractions.  The population of Torquay is boosted significantly during the summer months.

The subject property occupies a prominent position in the heart of Torquay’s town centre fronting the Strand and overlooking Torquay Harbour & Marina.  Torquay train station is approximately 1.6 km (1 mile) to the west. 

Occupiers within the immediate vicinity include Co-op Food, Taco Bell, Premier Inn and Hampton By Hilton hotel. 

The town’s prime retailing area is a short distance from the property, anchored at each end by two shopping centres; Fleet Walk and Union Square.  Fleet Walk is a three-minute walk from the property and is home to over 50 retailers including SportsDirect.com, Poundland, Trespass, Clarks, Bonmarche, plus a 414-space car park.  

Union Square is approximately half a mile to the north with occupiers including Greggs, Specsavers, F.Hinds, Iceland and Peacocks (see Regeneration section below). 

With almost 1,000 berths available, Torquay Harbour is a well-protected yacht haven with access to some of the best facilities in the Southwest. It is the ideal base from which to explore the English Riviera’s coast.  Only a short walk will lead visitors to a wide variety of facilities. Restaurants surround the harbour, from locally sourced fish and chips to Michelin starred dining. To the west of Torquay Harbour lies the Princess Theatre and Torre Abbey Sands, the main beach for Torquay. 

Town Centre Regeneration

Torquay is undergoing significant regeneration initiatives aimed at revitalizing its town centre and enhancing the harbourside area. A focal point of these efforts is the redevelopment of the former Debenhams site on Strand, immediately adjacent the subject property.

Redevelopment of the former Debenhams site

The former Debenhams department store immediately adjacent the subject property was acquired by Torbay Council and in November 2023 they formed a Regeneration Partnership with developers Milligan and Willmott Dixon to redevelop the site. 

The scheme is expected to significantly transform Torquay’s harbourside.  It will be a mixed-used scheme that stretches from 7-14 The Strand and links the harbourside with The Terrace. 

£2 million of Towns Funding has been allocated to the project and the Council is investing around £5 million of funding from their Growth Fund.  Private sector investment will also help deliver the scheme. 

The project will create a vibrant, high-quality destination offering employment opportunities across a range of sectors and providing new town centre living opportunities.  It will complement and enhance the Council’s wider public realm works.

Having already acquired the Debenhams site, the Council are now in the process of acquiring the other buildings it needs to undertake the scheme which include six properties on The Terrace, behind the old department store. This will then allow developers to move quickly with the new development. 

Broader Regeneration Initiatives

The transformation of the former Debenhams site is a key component of a larger investment by Torbay Council, supplemented by £21.9 million or funding from the government's Towns Fund, aimed at revitalizing The Strand and harbourside areas. 

The first of the Town Deal projects that has been delivered is the £4 million newly created public realm space at Torquay’s harbourside.  The Strand, which was previously dominated by public transport, now sees buses permanently relocated.  Boasting a Piazza-style promenade with the harbour ‘opened up’ with new paving, trees and benches, the new look harbourside is part of the community led redesign to encourage more people to visit and dwell in the area.

Another flagship project is the redevelopment of Union Square Shopping Centre which has £11 million of Town Deal funding allocated to it and will be complimented by further public and private sector investment.  In October 2024 the Council shared their design proposal that will be taken forward for full planning consent, anticipated to be in the first half of 2025.  The project will include demolishing the existing shopping centre while retaining the current multi-storey car park, creating new, high-quality homes, retail spaces, leisure facilities, public areas, and an NHS centre.  

15 The Strand comprises a substantial mid-terraced property of local stone construction beneath a flat roof and single glazed fenestration. Externally there is a beer terrace which is held by way of licence. 

The ground floor is split over ground and upper ground levels with the main bar servery to the left side of the ground level and a second bar servery to the rear of the property at upper ground level. There is seating with a mix of tables and chairs throughout and a disabled WC also provided at this level. 

The first floor comprises customer WC's, a staff room, managers office and a trade kitchen. The second floor is split in two and comprises the managers accommodation and a separate thermostatically controlled beer cellar. 

 

Following a £97,000 investment, the pub reopened in May 2024 as a Craft Union site. The renovation included exterior and interior decorative works, enhanced amenities including a new pool table and dedicated darts area, bar area improvements and enhanced viewing experience featuring additional large TVs. This recent investment demonstrates the tenant’s commitment to the site. 

16 The Strand comprises a restaurant arranged over ground and first floor which has been fitted out to a high standard by the tenant. 

Part of the upper floor have been converted to residential accommodation and sold off on long leases. Further details available upon request. 

 

16 The Strand (Ephesus Restaurant)

 

According to the Valuation Office website the rateable value for the property is as follows:

 

The business rate multiplier is 54.6 pence per pound for 15 The Strand and 49.9 pence per pound for16 The Strand.  

Freehold. 

15 & Part 16, The Strand

15 the Strand is let to Stonegate Pub Company Limited (t/a Yates), on assignment from J D Wetherspoon plc, for a term of 50 years from 10th January 1997, expiring on 9th January 2047 (approximately 21.5 years unexpired). 

The current passing rent is £85,000 per annum. There are five yearly upwards only open market rent reviews, the next being on 10th January 2027.

The remainder of the upper parts are sold off and not included in the sale.


16 Strand

The ground and first floor of 16 The Strand is let to Zara (Torquay) Limited, guaranteed by Gunduz Uven (t/a Ephesus Restaurant), on a full repairing and insuring lease for a term of 7 years from 16th September 2021, expiring on 15th September 2028. 

The passing rent is £42,000 per annum.  There is an upwards only open market rent review on 16th September 2026. 

A rent deposit of £25,200 is held by the Landlord. 

Therefore, an investor will benefit from a total income of £127,000 per annum. 

The remainder of the upper parts are sold off and not included in the sale.

The property has the following EPC ratings:

15 Strand (Yates)        C
16 Strand (Ephesus)        C

Stonegate Group is the largest pub company in the United Kingdom with a portfolio of over 4,400 sites.  

Stonegate Pub Company was established in 2010, following the acquisition of 333 pubs from Mitchell & Butlers for £373 million. In 2011 Stonegate purchased Town & City Pub company, acquiring the Yates and Slug & Lettuce brands in the process. In March 2020 Stonegate purchased Ei Group for £1.27 billion making it the UK’s largest pub company.

The Group’s estate covers a wide variety of formats with brands other than Yates and Slug & Lettuce including Walkabout, Be At One, Popworld, Social Pub & Kitchen, Sports Bar & Grill and Craft Union. 

Stonegate is backed by TDR Capital LLP, a leading private equity firm with over €15 billion of assets under management.  In July 2024 Stonegate announced the agreement of its debt refinancing requirements which included a £250 million shareholder contribution from TDR Capital.  This follows the announcement in December 2023 of a £638 million financing of 1,34 pubs.  As a result, the balance sheet structure has been “significantly simplified and strengthened” with the CEO of Stonegate stating that the company is “now in a really strong position to deliver on our longer-term objectives".

Stonegate Pub Company Limited has reported the following accounts:

For the year ending 31st March 2024 Zara (Torquay) Limited reported Net Assets of £593,973.  There is a personal guarantee from the Director, Mr Gunduz Uven. In addition, a rent deposit of £25,200 is held by the Landlord. 

The company trades as Ephesus, a popular stylish Eastern Mediterranean restaurant offering a selection of Greek and Turkish dishes. It is ranked no.16 out of 245 restaurants in Torquay on Tripadvisor.  

The property is VAT elected.  It is anticipated (subject to the purchaser’s VAT status) that the sale will be treated as a Transfer of a Going Concern (TOGC).  

The vendor is seeking a figure of £1,500,000 (One Million, Five Hundred Thousand Pounds), subject to contract, equating to a net initial yield of 8.0%, assuming purchasers’ costs of 6.10%. 

Note that Singer Vielle will be acting for the Purchaser and will charge a fee in accordance with our Terms and Conditions for Buyers.