British Land has exchanged on the sale of 12 superstores from its joint venture with Sainsbury’s for £429m, representing a net initial yield of 5%, to Realty Income Corporation.
This is the latest example of how British Land is delivering against its clear long-term strategy to build an increasingly mixed-use business focused on three core elements: campus focused London offices; a smaller, refocused Retail business and Residential, principally build to rent.
As part of this, the firm expects Retail to comprise around 30-35% of the assets of its business, down from around half today.
Alongside investment into its campuses, and progressing unique development opportunities such as Canada Water, wBritish Land is focused on further sales of retail assets which are not aligned to its strategy.
The group said it has a clear view of the value of its assets and despite the clear challenges currently in the retail market, we remain opportunistic and proactive. As a result, it has exchanged or completed on nearly £1bn of retail assets sales since April 2018 at an average yield of 5.7%. This activity has included the sale of Debenham’s Clapham and the Spirit pubs portfolio.
Once the transaction completes, which is expected at the end of May, British Land's superstores will fall to 1.3% of its portfolio, with six standalone stores remaining.