Supermarket Income sells £63.5m supermarket to Tesco
Supermarket Income REIT has sold a supermarket in Newmarket, Suffolk, to its operator Tesco for £63.5m.
The real estate investment trust said the sale was completed at a 7.4% premium to the property’s June 2024 valuation.
Upon disposal, the passing rent of the supermarket was £3.5m.
Supermarket Income REIT has also completed a trio of lease renewals at Tesco stores located in Bracknell, Bristol, and Thetford – which were the three shortest leased Tesco stores in its portfolio. The leases have been extended to 15 years with annual RPI-linked rent reviews, and have been renewed at an average of 4% rent to turnover.
The renewals mean that the company’s weighted average unexpired lease term has increased from 11 years to 12 years, and its next material lease expiry is not until 2032.
In addition, the group has completed the acquisition of nine Carrefour supermarkets in France for €36.5m (£30.2m).
Nick Hewson, chair of Supermarket Income REIT, said: “We have made significant progress on the portfolio initiatives that we set out in November 2024, which together are intended to support our earnings growth. These transactions highlight the inherent value of the portfolio, the importance of these stores for the grocery operators and our ability to crystalise value as part of our capital recycling strategy. We remain focused on continuing to make good progress with our remaining strategic initiatives, including delivering further cost savings for the company, and we look forward to updating the market in due course.”