Supermarket Income REIT has acquired a Tesco supermarket in Ashford, Kent, for £54.1m in a deal reflecting a net initial yield of 7%.
The 93,000 sq ft store, which has been acquired with an unexpired lease term of nine years, is located on an 8.2-acre site that also features a petrol filling station. Tesco has traded from the site for more than 30 years and uses it as an online fulfilment hub.
Supermarket Income REIT said current market conditions provide an attractive buying opportunity, at an inflection point in the real estate cycle where supermarket property valuations are at multi-year lows and long lease inflation linked assets can be acquired at accretive yields.
Rob Abraham, CEO of Supermarket Income REIT, said: “I’m very pleased that we have begun redeploying the proceeds arising from our recent joint venture, acquiring this top trading Tesco supermarket at an attractive price, which will make a material contribution to our earnings from day one. The team continues to work hard to execute on a number of further pipeline opportunities as it focusses on scaling the business whilst delivering sustainable earnings growth for our shareholders.”
