Supermarket Income REIT (SUPR) has seeded a new UK supermarket real estate platform with a portfolio of eight properties and will receive £200m (€234m) from Blue Owl Capital-managed funds in return for a 50% stake.
London-listed SUPR said it has seeded the new joint venture with £403m worth of supermarket properties from its current portfolio and will retain the remaining half stake in the venture, which aims to grow its assets to as much as £1bn in the coming years.
SUPR said the proceeds from the venture will be used to reduce debt in the near term and to invest in other supermarkets either directly for SUPR or indirectly through the joint venture.
Robert Abraham, CEO of Supermarket Income REIT, said: “With the potential to grow to £1bn over the coming years, the joint venture partnership represents Blue Owl’s managed funds’ first major investment in the UK grocery space and is a strong endorsement of the expertise and track record SUPR has established in this market.
“For our shareholders, the joint venture is another important milestone in our strategy to recycle capital and grow earnings and provides a platform for growth with specialist third-party capital. This follows a period of significant progress on a number of key strategic initiatives set out in November 2024, including renewing the three shortest leases in the portfolio, material cost reductions culminating in the internalisation of the management of the company and other capital recycling activity.”
Marc Zahr, co-president and global head of real assets at Blue Owl, said: “SUPR is the leading UK grocery real estate investor, and we view them as the right counterparty as we execute on our first major transaction in the UK grocery sector.
“We see an opportunity to generate attractive returns from these assets, which are underpinned by the growing and highly resilient UK grocery sector. We look forward to working with SUPR to grow the joint venture, as we execute on an attractive pipeline of UK assets.”
To read the latest IPE Real Assets magazine click here.
