Legal & General Investment Management‘s (LGIM) Managed Fund has bought the Tesco supermarket at Yarrow Road, Poole, UK for £46.1 million.
The 95,000 square foot store, together with 16-pump petrol filling station and 599 car spaces, was sold by clients of abrdn.
The transaction reflects an effective net initial yield of 7.75%. The property is let to Tesco Stores Ltd for a further seven years and the rent is subject to annual uplifts in line with RPI 0-4%.
Legal & General Investment Management’s (LGIM’s) Managed Fund is headed by Rob Codling, Senior Fund Manager.
He says, “This is a great acquisition for the fund, which we believe will provide a strong return for our investors. The store is well located and its prospects of continued high-performance, suits the long-term investment objectives of our clients.”
Morgan Williams advised abrdn and Montagu Evans advised L&G.
Montagu Evans’ Partner and supermarket investment specialist Mark Girling says, “The purchase is attractive to our client firstly due to the well located and accessible site at the centre of the Poole Bournemouth conurbation, secondly being a strong trading store for both physical and online sales and thirdly, having the benefit of annual inflation proofed income secured on the investment grade credit of Tesco Stores Limited. This profile fulfils the client Fund’s income and fundamental asset quality requirements at the present time.”
