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NewRiver Retail acquires 202 pubs for retail

RBR Staff Writer Published 28 November 2013

NewRiver Retail, the UK-based food retailer, is intending to expand its retail footprint across the country by acquiring 202 public houses from pub operator Marston's for £90m to be converted into retail stores.

The acquisition was funded by a joint venture partnership BRAVO II, managed by Pacific Investment Management Company with both partners to secure 50% interest each in the acquired property.

The retail major is keen to refurbish these locations to accommodate high demand for new convenience store premises from the UK's major food store operators.

The retailer claims that an average gross internal area of 3,150ft2, and site area of 29,000ft2 is ideal for food convenience stores, restaurants, drive-through food outlets, and medical centers.

"With increasing demand from all of the major supermarket groups for Convenience Stores substantially outstripping supply, the Portfolio provides a very attractive opportunity to generate capital profits through the conversion of the public houses into Convenience Stores underpinned by an attractive cash on equity return from a FTSE 250 company," added Lockhart.

Marston's has also signed a minimum four-year term leaseback agreement, extendable upto five years, during which, the pub-owner will manage and operate the locations, paying an annual rent of £12,23m.