Marston’s sells 27 newbuild pubs to Legal & General Property

The sites are all let to Marston’s on long, RPI-linked leases and have been purpose built for the company within the last seven years.

"Situated across the UK, they provide a good geographic spread, with 54% located in the South East, East Anglia and the South West, 32% in the Midlands and North of England, and 13% in Wales and Scotland," said Legal & General Property.

"The assets are all community or destination pubs, situated next to generators of high footfall, and are family-friendly and food-orientated in their offer, providing traditional fare at affordable prices in enduring locations.

The properties are predominantly held freehold, with the remainder on long leasehold structures at peppercorn rents."

Adam Kerr, head of long income transactions at Legal & General Property, said: "Let to a market leading pub operator, the portfolio acquisition not only offers good diversification, both by sector and geography, but also a secure, long-term income stream which is linked to RPI and therefore provides a good hedge against inflation."

Savills advised Legal & General Property and Darren Moorhouse of DCLM Commercial Property acted for Marston’s.

At its H1 results last week, Marston’s said that it had entered into three innovative long-term lease finance structures totalling £101m in the period, under which the freehold reverts to Marston’s at the end of the lease term.

"These agreements offer considerable flexibility at an attractive cost of finance, reduce our reliance on bank facilities, and extend the maturity of our debt without compromising our preference for freehold ownership of our estate," Marston’s said last week.

"We have received a further £7m in respect of these arrangements since the period end.

Market conditions permitting, we expect to undertake further similar transactions in the future."