British Land sells seven food retail properties for £118m

British Land has sold seven food stores for a total of £118m, of which its share is £62m, to institutional investors at net initial yields of between 4.95% and 5.7%, in line with March valuations.

The company, which was represented by Morgan Williams, Jones Lang LaSalle and Colliers International, said the disposals were in line with its stated strategy of capital recycling to maximise its portfolio returns.

Private clients of Orchard Street have bought the Tesco store in Wembley (Tesco JV) for £61.9m (net initial yield 5.5%) while the Sainsbury store in Leicester (Sainsbury JV) was sold to Sainsbury for £21.7m (net initial yield 5.2%).

Clients of CBRE Global Investors have acquired the Sainsbury store in Chadwell Heath (Sainsbury JV), the Waitrose store in Frimley (Sainsbury JV) and the Aldi store in Gorton for £19.2m, £9.6m and £3.2m respectively. These prices represent net initial yields of 5.2%, 4.95% and 5.7%.

And finally, the consumer co-operative Lincolnshire Corn Exchange & Markets has bought the Co-op stores in Barton and Cleethorpes for a total of £2.9m, representing a net initial yield of 5.4%.

Charles Maudsley, head of retail for British Land, said: “On the back of good demand in the foodstore sector, we have sold over £100m of foodstore investments featuring a variety of ages, rent levels and lease expiries. The sales were in line with, or above, our March valuations, reflecting the income security and growth prospects for the various stores.”