I watched a webinar from Supermarket Income REIT (SUPR) yesterday on the Investor Meet Company platform. This is not a company I currently hold but I may consider investing in it even though it is in the currently deeply unfashionable sector of commercial property trusts.
They have a focus on omni-channel supermarket properties and 80% of their leases are indexed to inflation with a WAULT of 15 years. They have hedged 100% of their debt exposure to 2026 at 2.6%. They claim it is a defensive, counter-cyclical company with a low LTV.
80% of their portfolio is leased to Tesco and Sainsburys and they have just established a new ESG committee, but who hasn’t?
Their indexed leases have caps of about 4 to 5% on about 5% of their portfolio.
The presentation was eminently clear with good slides.
There is also a recent report published by Edison on the company.
The current discount to NAV is 10.6% and the dividend yield is 5.8% according to the AIC so it is not as cheap as some REITs at present. But that may be because of the defensive nature of the business (supermarkets are unlikely to be affected much by the recession as people have to eat) and the historic good performance figures over 5 years.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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