Tesco has announced a deal to sell up to £650m of property to private property group Topland, through the sale and leaseback of its stores.

The UK’s leading retailer said the move would release funding for “further growth whilst maintaining the flexibility to operate and adapt its property assets”.

The transaction will include 33 Tesco stores and 2 distribution centres, accounting for around 5% of Tesco’s property assets.

Tesco finance director, Andrew Higginson said the deal provides Tesco with a flexible arrangement “to run stores in the best way for customers and in the most cost effective way for the business”.