Sainsbury’s is set to acquire the freehold of 13 stores it currently leases from property investment firm Supermarket Income Reit.
The deal, which was revealed in an update from Supermarket Income Reit in regards to its joint venture with British Airways Pension Trustees Limited, revealed that Sainsbury’s had exercised a purchase option to acquire 13 stores within its portfolio.
The acquisition will be completed in March 2023 upon expiry of the current occupational leases of the stores with the purchase price under the option to be determined based on the assumption of a “new 20-year lease to Sainsbury’s with the initial rent set at the higher of passing or open market, subject to upward-only, five yearly market rent reviews”.
The firm also revealed that Sainsbury’s has a further option to acquire an additional 10 sites in a similar deal which can be exercised between December 2021 and January 2022.
Ben Green, director of Atrato Capital Limited, the Investment Adviser to Supermarket Income REIT plc, said: “Sainsbury’s decision to buy back these stores is further evidence of the strength of demand for grocery property in the UK and also demonstrates the balance sheet strength of the supermarket operators. The exercise of this first tranche of options is expected to generate a positive NAV impact for Supermarket Income REIT.”
