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Supermarket Income REIT says its in talks to buy assets from an institutional investor

The investment group raised £200mln in October to support new asset acquisitions.

Supermarket Income REIT PLC - Supermarket Income REIT says its in talks to buy assets from an institutional investor

Supermarket Income REIT (LON:SUPR) in a statement, responding press commentary, confirmed it is in talks to acquire two assets from an institutional investor.

“The company will make further announcements in due course, as appropriate,” it said. “There can be no certainty that the acquisitions will be agreed nor as to the terms on which any transaction might be concluded.”

In October, Supermarket Income REIT raised £200mln (after initially setting out to raise £150mln) in a share placing amidst strong investor demand.

READ: Supermarket Income REIT picks up omnichannel site in Leicester

The funding was pursued as the company sought to take advantage of opportunities that have become available since the onset of coronavirus restrictions.

The trust invests in sites occupied by the major supermarket chains such as Tesco, Sainsbury’s, Morrison’s and Waitrose.

At that time, it said it had identified £400mln worth of omnichannel sites that meet its criteria of size and online fulfilment potential.

Earlier this month, on November 16, the specialist grocery site investor announced it had acquired a new site in at Beaumont Leys, Leicester from British Land and occupied by Tesco Extra and discount chain Aldi.

Tesco’s site comprises 97,000sq ft net with parking for 700 vehicles and a 12-pump petrol filling station and crucially for Supermarket Income’s strategy it has purpose-built online fulfilment facilities to serve its catchment area.

The Tesco site is being acquired with an unexpired lease term of seven years, with five-yearly, upwards only, open market rent reviews. The next rent review is in February 2023.

Aldi’s supermarket will open this year and extends to 14,800 sq ft with an unexpired lease term of 25 years.

There is also an additional 33,000sq ft of shopping units next to the Tesco Extra and the Aldi outlets occupied currently by Pets At Home, Costa, Greggs and WH Smith. The total consideration for the deal was £63.4mln, excluding acquisition costs, reflecting a combined net initial yield of 6.4%.

Quick facts: Supermarket Income REIT PLC

Price: 109.5 GBX

LSE:SUPR
Market: LSE
Market Cap: £729.19 m
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