UK REIT LondonMetric Property has acquired five M&S Simply Food stores for £26.0 mln (€36 mln) to add to its convenience retail portfolio.
UK REIT LondonMetric Property has acquired five M&S Simply Food stores for £26.0 mln (€36 mln) to add to its convenience retail portfolio.
It has simultaneously re-geared the leases on four of the properties to new 20-year leases, and the fifth property will consist of two units let to M&S for 15 years and to Aldi for 20 years.
The five properties have a weighted average unexpired lease term (WAULT) of 19.2 years and an overall rental income of £1.5 mln per annum. The purpose-built foodstores are situated across various locations in England including the Isle of Wight, Liverpool and Ferndown.
The average yield on cost for all of the M&S transactions is 6.3%.
Following these acquisitions, LondonMetric’s convenience retail portfolio will increase to £49.7 mln, comprising 10 properties let to retailers including Aldi, Boots, Iceland and M&S, with a WAULT of 15.9 years.
'The convenience food sector is continuing to grow at the expense of the traditional larger foodstores and we will look to increase our exposure to this sub-sector in expectation of sustainable rental growth and further yield compression,' said Andrew Jones, CEO of LondonMetric. 'These transactions with M&S are further evidence of the quality of our relationships with the UK’s leading retailers and our ability to work alongside them as their real estate partner of choice.'
