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Barings buys into Spain’s “resilient” food retail market

Supermarket_cartAsset management firm Barings has bought a portfolio of ten supermarkets in Spain, all fully let to French multinational Carrefour, as it moves to access the country’s “resilient” grocery retail market.

The assets were acquired for €73.4 million from real estate firm Kennedy Wilson on behalf of institutional investors.

Comprising a total of just under 40,000 sqm, the supermarkets have been fully let to food retail giant Carrefour for between 22 and 50 years.

Adolfo Favieres, the firm’s real estate head for Spain, said: “This acquisition gives us a unique opportunity to access Spain’s resilient grocery retail market with the purchase of a portfolio of well-located assets, let to an established operator with a strong covenant.”

According to the firm, supermarkets remain the favoured channel for food retail in Spain and represent over half of sales compared to online where the share is only 1.4%.

The majority of the supermarkets are in prime city centre locations, with two situated in Madrid, four in Barcelona, and others in Bilbao, Salamanca, Cadiz, and Almeria.

Gunther Deutsch, Barings’ head of real estate transactions for Europe, said the firm has adopted a “highly focused strategy” in Spain and is targeting “high quality assets with secure income”.

Favieres added: “The fact that Carrefour has operated out of these stores for up to 50 years with long leases in place, demonstrates the security of income this portfolio generates, making it an attractive core investment for investors.”

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