A deal worth $70 million: UK group sells 17 Cumberland Farms around RI
While Cumberland Farms may have started in Rhode Island, later moved to Massachusetts and then across the ocean in 2019, many of the convenience stores in the Ocean and Bay states have recently been sold to a San Diego real estate group.
Realty Income signed a deal with Cumberland Farms' owner, the United Kingdom-based EG Group, in March to buy up to 415 "single-tenant convenience store properties" in the United States, with transactions expected to close in the second quarter of 2023, which ended in May, according to a news release.
According to real estate data, at least 17 stores in Rhode Island were sold, totaling $75 million in sale value. An additional seven stores were sold in neighboring Massachusetts, for an additional $45 million. All together, 24 stores sold in the area for a combined $120 million.
Among the Rhode Island locations sold was 3400 Mendon Road in Cumberland, the only Cumberland Farms left in the town where the chain was founded.
Of the 415 stores being bought in the $1.5-billion deal, 80% are expected to be Cumberland Farms. The deal includes 116 convenience stores in Massachusetts, 87 in New York and 74 in Florida, accounting for 277 of the estimated 415 to be sold. The number of stores in Rhode Island is not listed in the release, and Realty Income did not respond to a request for comment.
Cumberland Farms property sales are part of a sale-leaseback deal
The sale-leaseback deal is estimated by the companies to be worth $1.5 billion.
In a sale-leaseback, a company, in this case Realty Income, buys the physical properties and leases them back to the company operating out of them, EG Group. The revenue generated by the leases will represent 2.9% of Realty Income's annual rent income and 11.3% of its income from convenience stores, according to the news release.
How Cumberland Farms started
Most convenience stores trace their roots to dairy operations – Cumberland Farms, now based in Westborough, Massachusetts, started in 1939 in Cumberland, Rhode Island, when Vasilios and Aphrodite Haseotes bought a cow.
In the 1960s, as car ownership became more widespread in America, the demand for door-to-door delivery of milk slacked off. Dairy operations frequently opened milk stores to sell their products directly to consumers. These stores often had limited offerings, including milk, eggs, bread and bacon.
Soon after that, what would be recognized as "convenience stores" were born when the milk stores expanded their stock, adding teenage staples such as chips, candy and soda in addition to tobacco products.
Cumberland Farms was owned by the Haseotes family until they sold it to EG Group in 2019. The family sold the 567 convenience stores it operated throughout the Northeast and Florida, according to a news release at the time from EG Group.
See which Cumberland Farms locations sold for how much
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Reporter Paul Edward Parker contributed to this report. Reach Wheeler Cowperthwaite at wcowperthwaite@providencejournal.com or follow him on Twitter @WheelerReporter.
This article originally appeared on The Providence Journal: 16 Cumberland Farms locations in RI sold to real estate company
