Barings buys Spanish supermarket portfolio for €73m

Real estate investment manager Barings has acquired a portfolio of 10 supermarket assets across five Spanish regions, on behalf of a core strategy for institutional investors, from Kennedy Wilson for €73.4 mln.

The 38,800 m2 portfolio is fully let to Carrefour, one of the world’s largest food retailers which has traded in these premises for between 22 and 50 years.
The majority of the assets benefit from prime city centre locations and good public transport connections, with two situated in Madrid, four in Barcelona and the others in Bilbao, Salamanca, Cádiz and Almería. Six of the units also offer generous parking provision with around 1,120 spaces across the portfolio.
Adolfo Favieres, country 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. 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.'
Gunther Deutsch, head of real estate transactions for Europe at Barings, added: 'Supermarkets remain the preferred channel for food retail, representing 54% of sales compared to online where the share is only 1.4%. We have adopted a highly focused strategy in Spain as we seek to the grow the portfolio, targeting high quality assets with secure income, underpinned by strong covenants.'

Peter Collins, president of Kennedy Wilson Europe, said: 'Since acquiring the properties in 2015, we strengthened the performance of the portfolio through our asset management program that included improving the lease terms with Carrefour. Our asset management program coupled with the robust grocery retail market and attractive local economic fundamentals resulted in a strong total return to Kennedy Wilson as we continue to focus on disposing non-core assets.'


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