Macquarie Asset Management, on behalf of Just Group, has partnered with clients to invest £400m in notes related to a portfolio of commercial ground leases.
The notes are secured against a portfolio of 55 Asda supermarket sites across the UK. The innovative transaction enables Asda Group to raise £400m of alternative long-term financing while retaining its freehold property interests. The transaction also enables Macquarie Asset Management’s clients to gain exposure to a high quality, long-term income stream from ground lease payments generated by the portfolio.
Hugo James, managing director at Macquarie Asset Management, said: “As the pace of risk transfer from pension funds to the insurance sector continues to grow, our ability to structure and invest in high quality income streams is increasingly important for our clients. We believe that the innovative structure created for this transaction can provide borrowers with a scalable financing option not previously available in the asset class.”
Macquarie Asset Management launched its secure income real estate strategy in 2020 to provide institutional clients with access to long-term and scalable income streams. Since it launched, the team has raised commitments of over £1.2bn from insurance and pension fund clients and invested across a range of sectors including hotels, day nurseries, NHS and local authority facilities.