Supermarket Income REIT has bought of a portfolio of Carrefour supermarkets in France through a €75.3m (£64.4m) sale-and-leaseback deal.
The purchase price reflects a 6.3% net initial yield.
The portfolio comprises 17 supermarkets, largely located in northern France and operated under the Carrefour Market brand. The stores have an average gross internal area of 40,000 sq ft.
The properties have a weighted average lease term of 12 years (with a tenant-only break option in year 10) with annual uncapped inflation-linked rent reviews.
To fund the acquisition, Supermarket Income REIT has drawn €81.7m from its existing HSBC revolving credit facility. The cost of the Euro denominated borrowing is 1.70% over Euribor.
Ben Green, director at Atrato Capital, the investment adviser to Supermarket Income REIT, said: “The transaction represents the company’s first investment in the €284bn French grocery real estate market. This accretive transaction is complementary to our existing portfolio, providing further tenant diversification and continues our strategy of investing in the future model of grocery.”
Carrefour is one of the largest grocers in the world, with a turnover of €94bn last year. The chain operates across 30 countries and is the second largest grocer in France.
Supermarket Income REIT was advised by Rothschilds & Co, Simmons & Simmons and Wargny Katz on the deal.
Image by Jasper Garratt/Unsplash
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