Supermarket Income REIT has acquired a Morrisons’ supermarket in Sheffield from Opus North for €58m (£51.7m), reflecting a net initial yield of 4.9%. The supermarket is located on an 8.4-acre site in the historic and prominent Hillsborough Barracks. It comprises a 113,000ft² supermarket, approximately 860 parking spaces and a 12-pump petrol filling station. It is being acquired with an unexpired lease term of 21 years with five-yearly, upward-only, RPI-linked rent reviews compounded annually (subject to cap and floor). The next rent review is scheduled for October 2019.
The company has also arranged a new five-year, interest-only loan facility with Bayerische Landesbank. The €58.5m (£52.1m) facility has an opening margin of 125 basis points above three-month LIBOR and is secured against the new Morrisons’ supermarket in Sheffield and the Sainsbury’s supermarket in Ashford.
Ben Green, Director of Atrato Capital, the Investment Advisor to Supermarket Income REIT, said: “This Morrisons’ supermarket is an excellent addition to our growing portfolio. The property benefits from strong fundamentals, attractive lease terms and provides further tenant diversification. This purchase completes our asset acquisition plan, which we set out at the time of our €72.9m (£65m) capital raise in May. We are also delighted to have secured Bayerische Landesbank as a lender to the company. Our new facility provides us with very competitively-priced, five-year funding”.
