Supermarket REIT readies for acquisitions drive

Supermarket REIT has said it has capacity to embark on an “accretive acquisitions” drive after delivering strong rental growth and a stable valuation across its portfolio. Results for the year ended 30 June show passing rent of £113.1m, up 12% from £100.6m a year earlier. The value of its portfolio increased by 5% to almost £1.8bn. The group said it had seen average like-for-like rents rise by 4% over the year and it had full occupancy and full rent collection across its portfolio. The REIT acquired some 20 assets across the UK and France during the year for a total consideration of £135.8m, reflecting a net initial yield of 6.7%. Chair Nick Hewson said: “The company’s operational performance has been resilient, with 100% occupancy and 100% rent collection despite the broader market and macro-economic challenges of the past years. “We have taken a disciplined approach to capital deployment and have recently begun to see opportunities to add accretive acquisitions in the UK and France. We continue to monitor opportunities to recycle capital via asset sales and joint ventures.” He added: “We have a balance sheet and asset portfolio which will enable us to deliver sustainable, long-term, earnings growth even at these new ‘normal’ interest rate levels. I am hopeful that as the equity markets refocus on the attractiveness of real estate, the quality of our assets and the secure nature of our growing income stream will once again be recognised. “In the meantime, due to our sector specialism, we continue to be able to selectively add attractive assets to our portfolio to grow earnings and ultimately dividend. Due to the prudent steps taken to run lower leverage throughout 2023, the company has had the balance sheet capacity during 2024 to take advantage as these opportunities arise.” Photo by Jochen Tack/imageBROKER/Shutterstock