Evaluation and Management of existing asset use and the available
alternatives that impact balance sheet, income statement, and tax obligations.
SALE LEASEBACK
Full Analysis and Execution
When a business sells its commercial property for current market value and
then instantly leases it back, they gain built up equity which frees up capital
which can be used to invest back into the business.
Leasing the property can defer tax liabilities and cash replaces the asset on the balance sheet.
The investor sees a return on their investment
from the rental revenue streams, and the operator continues to profit from the operation of the business.
The operator also maintains the right to sell the business operation.
Potential uses for a sale-leaseback transaction:
Financing further development or acquisitions
Paying down debt
Investing capital in current operations?
Potential benefits of a sale-leaseback transaction:
Greater cash flow and predictability
Eliminate the liability of real estate ownership
Result in off-balance sheet financing as an operating lease
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