The Sainsbury’s-Asda merger could be a “turning point” for attracting City investment into the supermarket property sector, according to one of the biggest-spending investors of late.

UK-listed Supermarket Income REIT said that with the combined business expected to attract an investment grade credit profile - should it make it through the expected CMA investigation - it would act alongside a reinvigorated Tesco to boost interest among big investors.

The company also predicted the CMA probe could result in some stores being sold to answer competition concerns, which would help take out some excess space from the UK market and boost the attractiveness of supermarket investments.

Adviser to the company Ben Green, founder of Atrato Capital, said: “We think this could be a great deal for Sainsbury’s but also potentially a turning point for the supermarket sector as far as investors are concerned.

“A merged Sainsbury’s and Asda would be a very attractive, investment-grade proposition for investors. Add to that the fact Tesco is now performing far better following the accounting scandal in 2014 and that it is on course to get its investment grade back.”

Supermarket Income REIT, which has already snapped up more than £200m of supermarket assets since an IPO last year, last month announced its intention to raise a further £65m through a share offer, having identified three potential supermarket purchases.

It has been looking to buy supermarket sites from owners such as insurance companies.

Fellow adviser Steve Windsor said: “Despite denials from the companies that there will be any closures, we believe there will have to be some store disposals from the CMA to allow the deal and we could well see some of those sites sold to different uses. This would be good for the sector because we still believe there is some overcapacity.”