Supermarket Income REIT has acquired a Tesco Extra supermarket in the North Lanarkshire town of Cumbernauld, Scotland, from Legal and General for €56.5m (£50m net of acquisition costs), reflecting a net initial yield of 5.5% after the next agreed RPI-linked rent review in March 2018.
The 9.5-acre site occupies a town centre location and is equidistant from Glasgow and Sterling. It comprises the 117,000 ft² Tesco Extra store, approximately 570 parking spaces and a 12-pump filling station. The store is strategically located for online fulfilment given the excellent motorway and road connections.
It is being acquired with an unexpired lease term of 23 years with annual, upward-only, RPI-linked rent reviews (subject to cap and floor) on full repairing and insuring terms. The purchase has been funded out of the €22.6m (£20m) equity placing issued on the 17 November and from the Company's Revolving Credit Facility.
Ben Green, Director of Atrato Capital, the Investment Adviser to Supermarket Income REIT, said: "This store has an impressive trading record on site and plays an important role in Tesco’s Scottish online fulfilment network. This investment is a strong addition to our growing portfolio, increasing both the weighted average unexpired lease term and net initial yield of the Company's portfolio”.
