Michelin Tyre is the front runner for the 33,908 sq m (365,000 sq ft) former Argos distribution unit at Penkridge, Staffordshire, vacant since the retailer relocated to Gazeley’s Acton Gate.
The deal is expected to follow Michelin’s pattern of taking short leases to allow for the sudden fluctuations in the market. At Penkridge the tyre manufacturer is looking to pay less than £21.52 per sq m (£2 per sq ft) on a five year lease with a break option in the third year.
Last year Michelin took 13,935 sq m (150,000 sq ft), also on a short term basis, at the former MOD base at Hilton, Derbyshire. Rents achieved on that scheme are between £11.84 per sq m and £17.22 per sq ft (£1.10 per sq ft to £1.60 per sq ft).
At the end of last year Argos relocated its distribution operations from Penkridge to a new purpose-built centre at Acton Gate in Staffordshire. The retailer took a pre-let on the 43,291 sq m (466,000 sq ft) complex on a 30-year lease at £43.05 per sq m (£4 per sq ft).
Gerald Eve is advising Michelin while King Sturge is acting for the landlord.
EGi News 03/05/97
