LXi REIT has confirmed it is in talks to buy a £500m sale and leaseback portfolio from Sainsbury’s.
The REIT expects to buy the 18 stores, which are predominantly located in the south of England, at a yield of around 5%.
LXi said the stores benefit from several defensive characteristics: “Strong trading performance, very low and sustainable indexed rents, long-term ‘green’ leases, low site coverage and modern buildings that provide omni-channel sales optionality.”
LXi said it will be discussing the possibility of an equity raise in order to part-fund the deal with potential investors. If that happens, it is expected to have an issue price set at a premium to the REIT’s estimated NAV per share as at 31 July 2022 of approximately 142p.
LXi said no binding terms with Sainsbury’s had been agreed, so there could be “no certainty that the acquisition, or the associated equity raise, will take place”.
It said a further announcement will be made “if and when appropriate”.
To send feedback, e-mail piers.wehner@eg.co.uk or tweet @PiersWehner or @EGPropertyNews
