Realty Income to acquire up to 415 single-tenant convenience store properties

Realty Income announced that it has signed a definitive agreement to acquire up to 415 single-tenant convenience store properties located in the U.S. from EG Group, an independent convenience retailer based in the United Kingdom. The portfolio is expected to be acquired at an estimated cap rate of approximately 6.9% and have a 20-year weighted average initial lease term. The transaction is expected to close in the second quarter of 2023, subject to customary closing conditions, approvals, and completion of due diligence. Approximately 80% of the total portfolio annualized contractual rent is expected to be generated from properties in the Northeast U.S., including approximately 116 properties in Massachusetts, 87 properties in New York, and 74 in Florida, which are the top three representative states in the portfolio. Over 80% of the total portfolio annualized contractual rent is expected to be generated from properties operated under the Cumberland Farms brand. Other representative EG Group brands in the portfolio include Tom Thumb, Fastrac and Sprint, and the average property size of the portfolio is approximately 3,700 square feet. Pro forma for the completion of the transaction, the convenience store industry and the EG Group are expected to represent approximately 11.3% and 2.9%, respectively, of Realty Income’s total portfolio annualized contractual rent.