Lidl, the popular German discount supermarket chain, has secured a landmark £70 million sale-and-leaseback deal to fund the development of 12 new stores across the United Kingdom. This strategic move is part of Lidl’s ambitious UK expansion plan, which aims to make affordable, high-quality groceries accessible to even more communities nationwide.
To bring this vision to life, Lidl has teamed up with Roadside Real Estate and Meadow Real Estate Fund, who have formed a joint venture to acquire these new stores upon completion. Under the agreement, Lidl will continue to manage and operate each location, allowing the retailer to strengthen its UK presence while unlocking capital to fuel further growth. Initially, Lidl acquired land and planning permissions for each of the 12 strategic sites. Once construction is complete, Roadside Real Estate will acquire the stores, leasing them back to Lidl under a 25-year contract. This flexible capital arrangement allows Lidl to grow its network while maintaining a robust operational foothold in key communities.
The funding deal sees the joint venture contributing an initial £30 million, with a further £40 million to be provided upon the stores’ completion between late October 2024 and February 2025. These new additions will bolster Lidl’s current network of over 960 UK stores, solidifying its position as a major player in the British retail sector.
Richard Taylor, Lidl GB’s Chief Development Officer, stated: “We have big ambitions for our expansion, including plans to open hundreds more Lidl stores in the future. This deal is just the latest example of how we’re continuing to grow our footprint, ensuring that more households can benefit from a Lidl store nearby. We look forward to a long and productive relationship with Roadside, Meadow, and the JV.”
Charles Dickson, Executive Chairman at Roadside, added: “The Lidl portfolio perfectly demonstrates the JV’s strategy, swiftly providing targeted capital to support tenant expansion while generating management fees and opening up further income opportunities.”
George Trimmer from Savills commented, “This is a valuable opportunity to forward fund the construction of 12 supermarkets let to Lidl. The 25-year leases not only provide long-term income stability with annual indexation but also enable Lidl GB Limited to unlock capital while retaining operational control.”
This sale-and-leaseback arrangement is a testament to Lidl’s commitment to sustainable growth, combining an innovative funding model with operational stability. By leveraging real estate partnerships, Lidl is accelerating its store expansion across the UK, continuing its mission to invest in quality and affordability for British customers.
Building, Design & Construction Magazine | The Choice of Industry Professionals
