Principal Real Estate has purchased a supermarket in Lisbon, Portugal, for €10.2 million for the Principal European Durable Income Fund (PEDIF).
Located in Setubal to the south of Lisbon, the 2,700 sq m supermarket is let on a long-term 15-year lease to Continente, which is part of Portugal’s leading food retailer, Sonae Group.
Robert Leadbetter, fund manager of the Principal European Durable Income Fund, commented: “Grocery retail real estate has been one of the stand-out asset types during the pandemic, providing investors with stable, typically long-term, income on inflation-linked leases, backed up by robust performance from the underlying essential retail occupiers.
“Viewed against the current economic backdrop of high inflation and rising interest rates, this is exactly the type of asset we’re looking for to complement PEDIF’s investment strategy.”
PEDIF was developed to provide institutional investors with access to long lease real estate investments in Europe, targeting commercial real estate assets across sectors with leases of at least 14 years fixed term, located throughout the Euro area, with a weighting towards Germany, Benelux and France.