Asda is said to be close to selling a tranche stores to lease back for 50 years, in a deal The Grocer revealed the supermarket was exploring in June.
Australian finance house Macquarie Asset Management is now close to buying ground leases linked to about 50 Asda stores in a deal estimated at about £500m, according to React News.
The ground leases – a highly unusual arrangement for food stores – will see Asda paying lower than the usual market value rent for the stores. The 50-year term is about double the conventional food store lease length.
The Grocer also reported in June that the ground lease portfolio was likely to attract private equity houses, as traditional food store property investors favour conventional leases lasting about 20-25 years with rent at full market value.
Asda’s deal with Macquarie Asset Management is said to include a provision for the supermarket to reassume ownership for a nominal amount at the end of the term.
Asda has been seeking to raise £1.1bn from property transactions as funding towards its £2.27bn acquisition of EG Group UK & Ireland in May. Since then it has sold about 25 stores with more conventional lease lengths to New York-based investor Realty Income Corporation for about £650m.
Neither Asda nor Macquarie Asset Management provided a comment.
No comments yet