Supermarket Income REIT acquired four UK supermarket assets valued at £210.5m in the first three months of 2018.
In a trading update for the period from 1 January to 31 March, the REIT said the investment properties, that operate as physical supermarkets and online fulfilment centres, had an annual rent roll of £10.8m, with upward only, annual, RPI-linked rent reviews.
The properties have weighted average unexpired lease terms of 18 years, with no break options and strong tenant covenants to Tesco and Sainsbury’s.
The average net initial yield of the portfolio at acquisition was 5% against the REIT’s period end valuation of 4.8% net initial yield. All assets were acquired off-market.
The REIT’s board declared a dividend in respect of the period of 1.4p per ordinary share, payable on or around the 21 May. The company said it was on track to deliver an annualised 5.5p per ordinary share dividend.
Ben Green of Atrato Capital, investment adviser to Supermarket Income REIT, said: “Since the IPO in July 2017, Supermarket Income REIT has rapidly built a portfolio of high-quality UK supermarket property generating attractive inflation-linked income for shareholders.
“During the quarter, we concluded two rent reviews with increases of 3.9%, demonstrating the value of the contracted RPI linkage in our leases.”
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