Supermarket Income REIT acquires additional stake in Sainsbury's reversion portfolio

Supermarket Income REIT has acquired a further stake in the beneficial interest in one of the UK's largest portfolios of supermarket properties from an Aviva Investors managed fund.

The 25.5 per cent beneficial interest has been acquired through the Company’s existing 50:50 joint venture (the “JV”) with British Airways Pension Trustees Limited (BAPTL). The purchase price is GBP115.0 million (excluding acquisition costs) meaning that the Company’s contribution to the JV to fund the Acquisition is GBP57.5 million (excluding acquisition costs).
The JV acquired its initial 25.5 per cent beneficial interest from British Land Plc in May 2020. Following this second acquisition, the JV’s ownership in the Portfolio is 51.0 per cent. The remaining 49.0 per cent beneficial interest is held by Sainsbury’s plc.
The Directors of the Company reiterate that the strategic rationale remains compelling for this high quality portfolio of predominantly omnichannel supermarkets. The portfolio offers strong property fundamentals and scope for progressive valuation growth in excess of the Company's targeted annualised total shareholder return.
The Portfolio was originally created through two sale and leaseback transactions by Sainsbury’s in 2000 and consists of the freehold interest in 26 Sainsbury’s supermarkets. It is a geographically diverse portfolio of stores with a London and south east bias. Further details on the Portfolio and transaction structure can be found below and on the Company’s website at:
Nick Hewson, Chairman of Supermarket Income REIT, says: “This acquisition increases the size of our investment in this high-quality Sainsbury’s property portfolio through our joint venture with British Airways Pension Trustees Limited. We will work closely with our tenant and co-owner, Sainsbury’s, to deliver a long term occupational solution for them.”

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