20th Mar 2015 07:16
LONDON (Alliance News) - British Land Co PLC on Friday said it has completed a GBP733 million property exchange deal with fellow FTSE 100 constituent Tesco PLC.
Under the terms of the deal, British Land has sold its 50% stake in a joint venture portfolio of 21 standalone food stores to supermarket chain Tesco and has acquired Tesco's 50% interest in two joint venture portfolios, which primarily comprise Tesco-anchored shopping centres and retail parks.
As part of the deal, Tesco will get GBP96 million from British Land.
"This mutually beneficial transaction clearly demonstrates the great relationship we enjoy with Tesco. It plays to our strengths of managing multi-let assets and gives Tesco more control of their stand-alone portfolio. We see significant opportunity to add value and drive returns through asset management and development," said British Land Head of Retail & Leisure Charles Maudsley.
"Last year we identified the opportunity to increase the proportion of our stores we own as freehold. This transaction with British Land allows us to increase our ownership and thereby insulate more of our businesses from indexed rent reviews. We have a long way to go but it's a transaction which takes us in the right direction. This agreement makes our business simpler and stronger," said Dave Lewis, Tesco's chief executive.
By Sam Unsted; [email protected]; @SamUAtAlliance
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