LONDON (ShareCast) - (Sharecast News) - Grocery property investor Supermarket Income REIT updated the market on its 50-50 joint venture with British Airways Pension Trustees on Friday.
The London-listed real estate investment trust said the venture has a 51% beneficial interest in the Sainsbury's Reversion Portfolio, with the remaining 49% beneficial interest held by retailer J Sainsbury.

It said the portfolio consists of the freeholds to 26 Sainsbury's supermarkets.

The company said Sainsbury's had exercised its second purchase option of two to acquire eight stores within the portfolio.

Sainsbury's acquisition of the eight stores would be completed in July 2023, on expiry of the current occupational leases.

Supermarket Income said the purchase price under the option would be determined based on the assumption of a new 20-year lease to Sainsbury's, with the initial rent set at the higher of passing or open market levels, subject to upward-only, five-yearly market rent reviews.

The exercise of this option was in addition to the first option exercised by Sainsbury's on 10 September to acquire 13 stores within the portfolio, which would be completed in March 2023.

In total, Sainsbury's exercised its option to acquire 21 of the 26 stores in the portfolio.

"Sainsbury's buyback of these stores is further evidence of the strength of demand for grocery property in the UK," said Ben Green, director of Supermarket Income's investment adviser Atrato Capital.

"The exercise of these purchase options is expected to generate a positive net tangible asset impact for Supermarket Income REIT."

At 1321 GMT, shares in Supermarket Income REIT were up 0.63% at 123.28p.

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