Supermarket Income REIT Acquires 10 Asda Supermarkets
Supermarket Income REIT, a UK-based property investor, has completed the purchase of 10 Asda supermarkets through a sale and leaseback agreement valued at £196 million. These stores, each averaging 78,000 square feet, are located in highly desirable areas and generate substantial sales volumes. The acquisition includes long-term 25-year leases with annual rent reviews tied to the consumer price index, featuring a 4% cap and 1% floor, and an affordable average rent of £19.90 per square foot.
Joint Venture Expansion with Blue Owl Capital
This transaction scales Supermarket Income REIT's joint venture with funds managed by Blue Owl Capital, bringing the total portfolio to £833 million and comprising 23 assets. Supermarket Income REIT's share of this transaction is £98 million, reflecting its 50% stake. The joint management of the Asda supermarket assets will be shared by the partners, while Supermarket Income REIT will oversee the administration and financial reporting for the joint venture.
Additional Asset Transfers
In addition to the acquisition of Asda stores, Supermarket Income REIT has agreed on terms for moving five of its current assets into the joint venture at a combined value of £232 million. This asset transfer is dependent on due diligence and is expected to be completed by 31 December.
"These transactions further demonstrate our ability to deliver on our strategy, as we continue to successfully drive returns for our shareholders. Working closely with Blue Owl, we are pleased to have increased the scale of the JV through the addition of these top quartile Asda stores and the expected transfer of five existing stores."
Summary
Supermarket Income REIT has strategically expanded its joint venture by acquiring 10 high-performing Asda supermarkets and plans to transfer additional assets, strengthening its position in the UK retail property sector and ensuring steady long-term rental income.
[3][4][6]