ADIB provides $27 million for Sainsbury’s supermarket deal


The transaction supported UCP with their acquisition of a Sainsbury’s store in Edinburgh, Scotland

The UK branch of Abu Dhabi Islamic Bank (ADIB) has provided structured financing of AED100 million ($27 million) on a supermarket asset to support investors with their Islamic financing needs.

The transaction supported Urbium Capital Partners (UCP) with their acquisition of a Sainsbury’s store in Edinburgh, Scotland.

The property comprises an 85,961 sq ft prime food store and a 12 pump petrol filling station occupying a 4.6 acre site, constructed in 2013. The property is let to Sainsbury’s on a 25-year lease.

The property occupies a highly prominent site offering excellent accessibility and visibility, benefiting from a large and affluent catchment area with a population of 250,000 within three miles, the bank said in a statement.

Paul Maisfield, head of UK Real Estate at ADIB, said: We are delighted to have supported UCP on the acquisition of this high quality asset, which not only provides long term secure income, but also benefits from all of the attributes of a store capable of performing an omnichannel function, thus future proofed against changes in the sector.

We look forward to helping support UCP execute their UK commercial real estate investment strategy targeting well located core assets with good income visibility and strong tenant covenants, with a focus on cash yield, he said.

This is the fourth supermarket investment transaction that ADIB has financed in the UK in the last 12 months as it continues to see strong demand for prime supermarket property investments given the sector resilience demonstrated during the Covid pandemic.

We expect to see further deal flow in this sector, added Maisfield.

Suliman Al Aujan, managing partner at UCP, said the acquisition is UCP’s debut transaction and is an asset benefits from strong trading fundamentals.

UCP will strive to build a defensive portfolio of assets that target income as the principal driver of attractive risk adjusted returns while looking to achieve capital growth through active management, he said.

ADIB closed over AED1 billion ($0.27 billion) in senior financing transactions in 2021 including AED260 million ($70.78 million) financing for a major Saudi investor to acquire the PWC HQ in Belfast.

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