Carrefour is teaming up with a group of institutional investors to buy 127 of the shopping centres in which it runs stores.
The small and medium-sized malls in France, Spain and Italy are being bought from property group Klépierre.
The two billion euro transaction is part of the French retailer’s latest attempt to revive its struggling European hypermarkets.
Carrefour will only pay 100 million euros in cash, but also contributes 45 of its French stores worth 700 million euros.
That gives it a 42 percent stake in the new property firm with annual rental income of around 180 million euros.
The move reverses a deal in 2000 that saw Carrefour sell more than 150 of its shopping malls to Klépierre to cut debt and fund an expansion spree abroad.
At that time, there was a trend among store groups to shed property assets to raise money and focus on retailing. But many have since found that without owning stores, they have less freedom to make changes needed to improve performance.
The world’s second-biggest retailer behind US group Wal-Mart has been battling for years to turn around its core hypermarket business as time-pressed customers increasingly shop locally and online, and buy non-food goods from specialists.
In October Carrefour said its hypermarkets in its main French market had returned to underlying sales growth for the first time in 5-1/2 years in the third quarter.