Fitness First in Poole is acquired by South Somerset District Council to support vital local services
South Somerset District Council has acquired the freehold interest in the former headquarters of Fitness First for £2,550,000.
This reflects a net initial yield of 7.47% and a capital value of £140 per square foot. The transaction for the site - 54 Willis Way, Poole - was facilitated by the negotiation of Yates RE’s Toby Yates and Steele Raymond’s Jennifer Rogerson.
The property comprises an 18,174 square foot high quality gym occupied by Fitness First for an 18-year unexpired term, with a break in eight years.
Why did the council choose to invest in this property?
With gyms badly hit by the Covid-19 pandemic, the property might not seem like an obvious pick for investment, however there is strong mitigation in this case.
The fitness industry has been growing rapidly in recent years with 4.5m people members of gyms in 2011, rising to 7m in 2019 (Statista). Our analysis shows that we would expect this trend to continue post-lockdown and we are aware of active requirements in the marketplace.
The property is located in a highly accessible part of Poole, on a principle route between the town centre and the main road intersection in the town. Surrounding property is in trade counter, retail warehouse and industrial use and the property’s large car park makes it attractive to a range of operators. The low capital value per square foot underpins these uses.
The purchase forms part of the Council’s investment strategy, which is focused on finding value within a competitive market, to help provide an income stream. It will allow the Council to meet its income shortfall following a significant reduction in Government grants and continue the provision of essential public services.
The asset joins a diverse portfolio of offices, industrial units and retail units across the South of England, the Midlands and Wales.