The Co-operative Group is aiming to raise £175m over the next three years by selling off unwanted property.
The society, which has a vast property empire worth £1.69bn encompassing stores, farms and residential sites, said the capital raised from the sell-off would be invested in "other group projects".

The Co-op Group raised £2bn to buy Somerfield for £1.57bn last summer and CEO Peter Marks has freely admitted in its annual report that it will have to keep "a tight rein on finances" this year. 

It is selling off 133 stores following the Somerfield deal as part of its OFT agreement. Its property arm The Co-operative Estates, which is bidding to build an eco-town in Leicestershire, delivered cash savings in excess of £40m for the society last year.

"2009 will be known as the year in which cash is king," Marks said in the annual report. "The business had to borrow heavily in order to fund the acquisition of Somerfield and complete the rebranding of our store and branch estate, so it is imperative we manage cashflow even more rigorously than normally." 

The society was "perfectly placed to capitalise on a shifting marketplace", he added.

A Co-op Group spokesman played down the sell-off. "Property has always been part of our trading activities and our investment portfolio is regularly churned to produce an income we buy as well as sell," he said. "We have a wide range of property not just residential, but former trading properties and land across the UK."

The Co-operative Estates would have a "significant" part to play in integrating Somerfield, Marks added. The business would help The Co-op Group meet targets and plan for the increased volume gained from the acquisition.

The Co-operative Estates will also focus on renewables and wind farms this year by developing new sites. It recorded a trading profit of £20m for the year to 10 January, down £1.5m on the year before. Capital loss on the society's investment porfolio was £62.3m.