Shares in REITs have been among the biggest fallers on the UK stock market as turmoil continued to grip UK financial markets on Monday, causing a £500M real estate investment deal to collapse. The sharp interest rate rises expected to be caused by the collapse in the value of the pound augurs a tough period for the real estate sector in the UK. LXi REIT said Monday it was pulling out of a deal to buy 18 supermarkets from Sainsbury’s for £500M at a yield of 5%. Just last Thursday, it said that it had exchanged contracts on the deal, flagging that the inflation-linked leases would be beneficial in a period of high inflation. 
In its announcement on Monday, LXi cited only “market volatility” as its reason for pulling out of the deal. But in a note on the transaction, analysts at Stifel gave insight into how the deal was scuppered, pointing to collapsing share prices, triggered by the volatility in the pound and…  Read the full story here. | 
