San Diego-based Realty Income Corp. has begun an international expansion with the purchase and lease-back of 12 supermarket properties in the Untied Kingdom.
The properties are locations of Sainsbury’s, a leading supermarket chain with over 1,400 grocery and convenience stores across Britain and Ireland. The purchase price was approximately $550 million.
“We are excited to announce this strategic transaction, which supplements our robust domestic investment pipeline and represents a natural evolution of the company’s strategy,” said Sumit Roy, Realty Income’s president and chief executive officer, in Tuesday’s announcement. “Sainsbury’s is a natural fit to our existing high-quality real estate portfolio.”
“We believe that the size of the European net-lease market and a need for a large-scale, well-capitalized institutional real estate partner creates a very propitious environment for us,” he added.
As a result of the transaction, the company is increasing its 2019 earnings forecast to the range of $1.39 to $1.44 per share from $1.36 to $1.42.
The real estate investment trust owns over 5,700 real estate properties that are under long-term lease agreements with commercial tenants.
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