Step Places to sell Cotton Square in Manchester

The developer is seeking offers above £3m for the multi-let leisure building, whose tenants include Edinburgh Castle Public House and Second City.

Nestled off Blossom Street and between Henry and Cotton streets, Cotton Square is a few steps away from public plaza Cutting Room Square.

Knight Frank and Real Estate North have been instructed put the Cotton Square’s public house and ground floor retail units on the market. Together, the spaces make up 8,772 sq ft. All the units are let with a WAULT of 15.66 years to expiry and 14.19 years to break.

The building takes in £184,000 in headline rent per year, with an average rent of £21/sq ft. That is low for the neighbourhood, which has seen other properties go for £30/sq ft.

If Cotton Square sold for the £3m guide price, the deal would reflect a net initial yield of 5.75%.

“This is one of the best leisure pitches in Manchester,” said Knight Frank partner Matt Stretton.

“Step Places did a wonderful job developing modern, well configured units around the iconic Edinburgh Castle pub,” he continued. “Their commitment to finding high-quality independents reflects the character and charm of Ancoats and all units are now fully let.

“This opportunity would suit an investor wanting a high-profile leisure investment in Manchester’s most thriving neighbourhood where rents and profile continue to rise.”

Not included in the sale: the 23 apartments and townhouses on the upper floors of Cotton Square. Those have been sold to owner occupiers.