Sainsbury’s has sold the second of four distribution depots it put up for sale earlier this year, completing two deals in two weeks which represent 1m sq ft in floorspace and just under £80m.

Canada Life has paid £40m to buy the 560,000 sq ft shed at Radial Park in Stoke on Trent. Sainsbury’s has taken a 25-year lease on the property at a net initial yield of 5.65%, again with RPI-linked rent reviews.

The other sale-and-leaseback, signed last week, was to BAE Systems Pension Scheme, which has bought the 425,000 sq ft warehouse in Tamworth for £38.5m and leased it back to the supermarket on a 30-year lease at a net initial yield of 5.5% with RPI- linked rent reviews.

The other two warehouses, in Hams Hall in the West Midlands and Haydock in Merseyside, are still on the market but interest is thought to be strong.

High quality property
Peter Winfield, head of business space investment at Cushman & Wakefield which acts for Sainsburys, said: ‘These deals clearly demonstrate that there is institutional demand for high quality property in the current market which reflects the most challenging trading conditions in recent years.’

Kitchen La Frenais Morgan acted for BAE, and Atisreal acted for Canada Life.