Asda sells 24 stores to lease back in £568m deal

Asda has revealed that it has sold 24 stores to investors, which it has leased back, raising £568m.

The company confirmed that four stores (Small Heath, Colindale, Coventry Abbey Park and Killingbeck) have been sold to DTZ Investors and leased back.

It also confirmed that 20 stores and the Lutterworth depot have been sold to Blue Owl Capital and leased back.

All properties are subject to 25-year lease agreements, with a contractual option to renew for an additional 10 years at each renewal point.

An Asda spokesperson said: “Asda’s property strategy is centred on maintaining a strong freehold base while also taking a considered and selective approach to unlocking value from our estate where appropriate. These transactions reflect that approach, enabling us to realise value from the sites while retaining full operational control.”

GMB Union has criticised the deal calling it ‘yet more asset stripping’ to settle its debt liabilities.

It is a similar strategy to the one employed by Morrisons which just over a year ago struck a £370m deal for its property portfolio as it sought to shrink its debt pile. Morrisons is owned by private equity firm Clayton Dubilier and Rice.

Asda was acquired from Walmart by billionaires Zuber and Mohsin Issa, backed by TDR Capital, in 2020 for £6.8bn.

The supermarket had £3.8bn in net debt at the end of 2024, the same as at the end of 2023, its latest full-year accounts show.

Nadine Houghton, GMB national officer, added: “Asda’s owners, TDR Capital, is selling off yet more assets to settle the debt liabilities heaped on the business by its own borrowing. Debt is up, lease liabilities are up, interest payments are up – but market share and staff morale are rock bottom.

“GMB members working on the shop floor and in distribution continue to report declining health and safety standards and increased stress levels brought about through asset stripping. Asda was once one of the UK’s biggest retailers – where will it all end?”