British Land sells 12 Sainsbury’s stores for £429m

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British Land Sainsbury's
// British Land offloading 12 Sainsbury’s superstores as part of a wider plan to slash its retail exposure
// Stores sold to Realty Income Corporation for £429m
// British Land plans to cut retail assets to around 30%-35% of its portfolio, down from around 50%

British Land is selling off 12 Sainsbury’s superstores from its joint venture with the Big 4 grocer as part of a wider plan to slash its retail exposure.

The property giant is selling the stores to Realty Income Corporation for £429 million and said its share of the proceeds will be £193.5 million.

British Land said this represented a “modest premium” to the book value recorded in September last year.

The sales comes as the property firm pushes on with slashing its retail assets to around 30 to 35 per cent of its portfolio.

At the moment, around half of British Land’s portfolio is retail.

The company has already exchanged on or completed the sale of nearly £1 billion worth of of retail assets since April last year.

It said it was focused on further sales of retail assets that were “not aligned to our strategy and continue to make good progress”.

“We have a clear view of the value of our assets and despite the clear challenges currently in the retail market, we remain opportunistic and proactive,” British Land said.

The latest deal with Sainsbury’s will reduce British Land’s superstores exposure to around 1.3 per cent of its portfolio, with six standalone stores remaining.

The property giant said it would see net proceeds of around £95 million from the sale, after repayment of debt and fees.

Other recent retail sales include the sale of Debenhams in Clapham Junction and the Spirit pubs portfolio.

It comes as British Land’s rental income took a hit last year on account of a string of failures in the retail industry.

Its retail portfolio includes Sheffield’s Meadowhall shopping centre as well as several major London developments.

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