Roadside Real Estate joint venture acquires 12 Lidl stores across Britain in £70m deal
() , a real estate business focused on modern roadside retail assets, including EV charging infrastructure, announced that its joint venture with Meadow Partners has signed an agreement with Lidl Great Britain to acquire 12 stores for a total consideration of £70m.
The joint venture, Roadside Retail Limited, was set up by the two companies in 2023 to acquire and develop UK-based roadside real estate assets. Meadow is a US$6.6bn vertically integrated real estate investment manager, based in New York and London. The 12 Lidl stores to be acquired are located in Northampton, Reading, Bristol, Hull, Saffron Walden, Downham Market, Manchester, Alexandria, Birmingham, Crediton, Bovey Tracey and Redcar.
The stores are currently under construction, with completion anticipated between late October 2024 and February 2025. Following an initial commitment of £30m for the land value of the 12 sites, Lidl will sell to the JV and leaseback each of the 12 new stores upon completion. The agreement stipulates 25-year leases with annual indexation, with a fixed rent commencement date of March 1, 2025.
In line with the terms of the JV, Roadside will provide 3.0% of equity for the acquisition of the Lidl portfolio, amounting to an initial £450k, and a total maximum commitment of £2.1m. This will be funded from Roadside's existing cash resources.
Charles Dickson, Executive Chairman of Roadside, commenting: "The Lidl portfolio is an excellent example of the JVs strategy in action, rapidly providing targeted capital to enable tenant expansion whilst securing asset management fees and creating additional opportunities for income initiatives."
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A major announcement from Roadside and its JV with real estate giant Meadow Partners of a £70m acquisition and leaseback of 12 Lidl locations spread evenly across the UK. The 12 stores are all between 20,000 and 25,000 sq feet and will add to Lidl's existing 960+ store estate. Lidl is currently the fastest growing supermarket chain the UK.
The deal will forward fund the construction of the 12 supermarkets near major local thoroughfares to let to Lidl on 25-year leases, providing good revenue visibility over the long term, bolstered by annual indexation. For Lidl, the leases will unlock capital, enabling further expansion.
This is the joint venture's fourth and largest deal to date, with several further site acquisitions in active negotiation as it works to deploy its equity commitment. The Lidl deal will deploy a significant portion of that capital into a high-quality asset with a major well-recognised tenant, with a good geographic spread across the UK.
Meadow's participation testifies to the high value and upside potential of the deal, as the real estate giant aims to add long-dated credit income assets, trading at historically wide yields, in high-quality submarkets. The Lidl locations are consistent with that strategy, offering strong long-term returns in an attractive sub-sector of the UK real estate market.
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