Supermarket Income REIT said it intends to raise £175m to buy some of its near-£600mln pipeline of supermarket properties.

The real estate investment trust, which invests in omnichannel supermarket properties, set the issue price for the placing at 121p per share, a 4.3% discount to the last closing price and a 7.1% premium to its last reported EPRA net tangible assets per share of 113p.

The group which migrated to London’s main market this year said supermarket property assets with an aggregate value of roughly £150mln are currently under exclusivity, with investment adviser Atrato Capital conducting advanced due diligence on £120mln of this.

A further £440mln pipeline of assets has also been identified that meet the company’s investment criteria.

The company said the £175mln, together with associated debt financing, should enable it to purchase some of the target assets.

If more money is raised, it will consider acquiring additional assets in the pipeline.

“Omnichannel supermarket stores continue to play a pivotal role within the UK’s grocery infrastructure and present a safe haven for investors seeking a source of secure, predominantly inflation-protected income in the current environment of rising inflationary pressures and wider geopolitical uncertainty,” Nick Hewson, chairman, said.

“Currently, 85% of the company’s existing rental income is directly linked to growth in inflation, and historically there has been a high degree of correlation between inflation and food prices, which means that the ability of our grocer tenants to pay the rental income remains sustainable in the long term.

“Additionally, our focus on acquiring omnichannel stores allows us to benefit from both in-store and online grocery shopping, driven by the growth of working from home which has boosted the entire grocery sector.”

He added the company has maintained a record of deploying the proceeds of equity raises within six months.