Fri, 29 Apr 2022 | COMMERCIAL PROPERTY
Offers of over £7 million are being sought for the Picture Palace cinema in Harrogate. The real estate team at CBRE has brought the freehold interest in the Grade II listed Picture Palace, built for Odeon in 1936 and renovated in 2008, to market.
The building is leased to Odeon on a 25-year-term, with a 16.3-year unexpired term and yearly RPI-linked rent reviews, which are subject to a 5 per cent cap and 1 per cent collar. The asking price of over £7 million reflects a 7 per cent net initial yield.
The opportunity to acquire the five-screen cinema comes at a time when the UK cinema industry is poised to recover fully from the COVID-19 pandemic. While last year’s takings were still considerably down from pre-pandemic figures in 2019, the sector is being forecast to perform strongly in 2022, with customer sentiment returning and several large blockbusters set for release, including Thor: Love & Thunder, Top Gun Maverick and a sequel to Avatar.
The Picture Palace features 892 seats across its five scenes and is set on a site of close to 24,000 sq ft. The cinema also has partial ownership of a car park with space for 88 cars. It is well situated to attract high footfall, standing a short walk from the centre of Harrogate, directly opposite the town’s train station and close to the A61.
Alfie Stephenson, of the Operational Real Estate Team at CBRE, said: “This iconic building has prospered under the operation of Odeon since it opened and is a firm fixture on the Harrogate leisure scene.”
"The long-income investment opportunity enables a keen investor to acquire the freehold interest on a cinema leased to the UK’s largest operator on a term that benefits from annual RPI-linked rent reviews. Our research shows that the cinema sector is set to have a strong 2022 with attendances anticipated to return to 100% of 2019 levels which makes this a timely opportunity.”
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