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(Updated May 2012)
Often used as a financing alternative, sale-leasebacks offer financially struggling companies access to cash to pay down debt and improve the bottom line. And in a post-Enron environment, sale-leasebacks provide an alternative to the less favorable option of synthetic leases. Find out how sale-leaseback transactions have helped the balance sheets of hotel, restaurant, retail, and other businesses, in the articles and books in this guide. (S. Hogan, Information and Web Content Specialist)
About Sale-Leasebacks
sale-leaseback: A technique in which a seller deed property to a buyer for a consideration, and the buyer simultaneously leases the property back to the seller.
Source: Glossary of Housing Terms, National Association of REALTORS®.
Image Source: Barron's Educational Series, Inc. via allBusiness.com.
Advantages of a Sale-Leaseback
- Reinvest in the company
- Retire debt
- Improve credit rating
- Increase productivity
- Make an acquisition
- Get a better return on capital investment
- Avoid negative impact from depreciation on the financial statement
Source: Right now sale/leaseback may be the only option to obtain cash and a healthier balance sheet, (PRWeb, Oct. 9, 2009).
About Sale-Leasebacks & Synthetic Leases
Sale-Leaseback Transactions, (KW Commercial, 2012).
Changes to Lease Accounting: Will Sale/Leasebacks Still Make Sense?<, (Site Selection, May 2011).
Sale-Leaseback Solutions: Examine the Business and Tax Considerations of These Transactions, (CCIM Institute, n.d.).
Advantages of Sale-Leasebacks
Signs of Life in Sale-Leasebacks, (Realtor Magazine, June 2011).
Sale-Leasebacks: A Smart Real Estate Strategy in Tough Times, (Area Development Online, Nov. 2010).
Sale-Leasebacks Provide Capital for Core Business Investment, (CCIM Institute, n.d.).
The Corporate Sale/Leaseback Strategy, (Society of Industrial and Office REALTORS® Educational Foundation, n.d.).
Hotel & Restaurant Property Leasebacks
Nevistas Offers Hotel Sale Leaseback Financing Program for Flagged Hotels<, (Hotel News Resource, Mar. 11, 2010).
Restauranteurs Turn to Sale-Leaseback Deals to Convert Assets into Capital for Expansion, (Nation's Restaurant News, Apr. 14, 2008). Q
Sale-Leaseback Transactions for Mid-Size Banks a Timely Way to Realize Off-Balance Sheet Value, (Western Independent Bankers, Feb.-Mar. 2007).
Government Property Leasebacks
Evaluating the Sale-Leaseback Proposal: Should the State Sell Its Office Buildings?, (Legislative Analyst's Office, Apr. 27, 2010).
Government Sale-Leasebacks, (NAI Alliance, Feb. 25, 2010).
States Turn to Commercial Properties for Cash, (The Seattle Times, Feb. 12, 2010)..
Healthcare Property Leasebacks
Not a Deal-Breaker: Sale-leasebacks Still Attractive to Skilled-Nursing Operators despite Rate Cuts, (Modern Healthcare, Nov 7, 2011). Q
The Hartford's Deep Embrace, (Hartford Business Journal, Mar. 2, 2010).
Healthy Prognosis for Medical Buildings Market, (NuWire Investor, Nov. 17, 2008).
Articles, Surveys & More from NAR
Find all of NAR's Commercial Real Estate Research here.
Find an index to all NAR Research here.
2011 Commercial Real Estate Lending Survey, (National Association of REALTORS®, 2011). - In March 2011, the National Association of REALTORS® conducted a survey of commercial real estate members focused on assessing how lending conditions impacted commercial transactions.
Commercial Real Estate Market Outlook (National Association of REALTORS®)
The Commercial Real Estate Outlook is NAR's flagship commercial research publication. It is produced quarterly and includes the latest market information on five major commercial real estate sectors — industrial, office, multi-family, retail and hospitality real estate.
eBooks & Other Resources
eBooks.realtor.org
The following ebooks and digital audiobooks are available to NAR members:
Complete Book of Real Estate Leases(Adobe eReader)
Investing in real estate with lease options and "subject-to" deals(Kindle, Adobe eReader)
The Leasing Process: Landlord and Tenant Perspectives(Adobe eReader)
Negotiate the Best Lease for Your Business(Adobe eReader)
Books, Videos, Research Reports & More
The resources below are available for loan through Information Central. Up to three books, tapes, CDs and/or DVDs can be borrowed for 30 days from the Library for a nominal fee of $10. Call Information Central at 800.874.6500 for assistance.
Real estate investors deskbook, (Boston, MA: West Group, 2011). HG 4521 Ar6Re
Commercial lease law answer book, (New York, NY: Vendome Group, 2008). KF 593 C6
Managing and leasing commercial properties, (New York, NY: Wiley, 2007). HD 1394 AL2ma
Real estate finance: theory and practice, (Mason, OH: Thomson Southwestern, 2003). HG 4029 C57 Ed. 6
Real estate sale/leaseback: a review of the advantages and disadvantages, (Washington, D.C.: Society of Office and Industrial REALTORS®, 1993). HD 1384 So1
Field Guides & More
These field guides and other resources in the Virtual Library may also be of interest:
Field Guide to Commercial Property Management
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