Supermarket Income REIT buys six grocery property for £104m

Supermarket Income REIT has acquired six grocery properties for £104m, absolutely deploying the proceeds of an fairness increase it accomplished earlier this 12 months.

The firm stated the portfolio, along with three supermarkets it agreed to purchase in July for £118m, had used up the £100m it raised from shareholders that month.

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The mixed purchases have been made at a mean web preliminary yield of 6.6% and carry a weighted common unexpired lease time period of 10 years.

The newest property embody Sainsbury’s and Morrisons supermarkets in Macclesfield and Leeds, each on 13-year leases and providing click-and-collect and residential supply; an M&S-anchored retail park in Nottinghamshire; smaller shops let to the Co-op and M&S; and a Sainsbury’s grocery distribution centre in Avonmouth on a 14-year lease.

Most of the properties carry inflation-linked rents.

Rob Abraham, CEO of Supermarket Income REIT, stated: “These acquisitions add six high-quality grocery property to our portfolio, marking the completion of the deployment of the proceeds of our £100 million fairness increase in July. We are happy to have delivered this compelling pipeline of acquisitions inside two months. Importantly, these acquisitions symbolize additional progress in our technique to diversify the portfolio, including grocery distribution and extra publicity to grocery-anchored retail, to our core UK foodstores, which span bigger, omnichannel supermarkets by means of to comfort.”

This is an attention-grabbing belief, with foundations within the spine of UK retail and a yield of seven.5%. An enchancment in sentiment across the UK will present shares with a lift – not that it’s a wildly risky belief.