Sale Leaseback, or sale-and-leaseback
Is a financial transaction, where one sells an asset and leases it back for the long-term; therefore, one continues to be able to use the asset but no longer owns it. The transaction is generally done for fixed assets, notably real estate; industrial, retail and office buildings, and the purposes are varied, including financing, accounting, and taxing. Leaseback – (by sale leaseback companies / experts) Sale Leaseback – Wikipedia
In other words – a Sale Leaseback is a financing transaction where a company sells its owned real estate and simultaneously leases the property back on a long-term basis. The company retains complete operational control over the property, as if it were the owner. It’s an effective tool for maximizing a company’s capital. Sale Leaseback | learn more | John Garabedian Realty Advisors
Sale Leaseback transactions serve as an effective way for businesses to monetize their real estate assets, allowing them to redeploy capital back into various aspects of their business.
Sale Leaseback arrangements
After purchasing an asset, the owner enters a long-term agreement by which the property is leased back to the seller, at an agreed-to rate. One reason for a leaseback is to transfer ownership to a holding company, while keeping proper track of the ongoing worth and profitability of the asset. Another one is for the seller to raise money by offloading a valuable asset to a buyer who is presumably interested in making a long-term secured investment. Leaseback arrangements are common in the REIT industry. Sale Leaseback – Wikipedia
Services | Garabedian Realty Advisors
Garabedian Realty Advisors specializes in two types of real estate. Single Tenant Net Leased and Sale Leaseback.
Single Tenant Net Leased (STNL) property is the best way to own a management-free investment in real estate. These types of investments are typically long term (15-25 years) and as the name implies are net leased, meaning that there are no landlord responsibility (absolute or bondable). In many cases they are credit tenant leased (CTL). When placing a loan on a CTL deal, the better the credit the higher loan to value (LTV) an investor can achieve with a lower interest rate (based on points over 10 year US treasuries or Canada Bonds). GRA specializes in STNL and CTL in the United States and Canada . THAT’S ALL WE DO. When you do something long enough you get pretty knowledgeable and street smart (not just book smart).
Sale Leaseback (SLB) is the best way for a corporation to take full advantage of the underlying value of their real estate. In many ways the SLB allows a corporation to retain control and use of their real estate and to utilize 100% of the cash generated by the transaction. By establishing a long term operating lease they can take the real estate liability off balance sheet and replace it with a tax deductible operating lease. They can then take the cash derived from the transaction and pay down debt or redeploy in existing or new operations. As far as the investor is concerned it is a single tenant net leased property acquisition with a tenant already in place with a long term lease. No leasing commissions, no vacancy risk upon acquisition. Sale Leaseback | learn more | John Garabedian Realty Advisors
Track Record | Garabedian Realty Advisors
Garabedian Realty Advisors (GRA) has advised several international institutional and non-institutional investors in identifying potential investments in the United States and Canada. We have executed transaction on a portfolio basis and on a one-off basis. All have been single tenant net leased properties. Examples of portfolios are 7 Lowe’s Home Improvement Centers in the Atlanta, GA and MS area. An example of one-off is the Halliburton facility in Rock Springs, WY. GRA has done several sale-leasebacks with large companies such as an office building occupied by Sony Pictures Entertainment where the tenant signed a 20 year net lease, with a Canadian institutional investor, simultaneous with the closing. Another example is the Michigan distribution center for A&P located in Detroit. A&P signed a 20 year net lease and simultaneously sold the building to an Israeli investor.
CCIM | John Garabedian
John Garabedian received his CCIM (Certified Commercial Investment Member) designation in 1989. A Certified Commercial Investment Member (CCIM) is a recognized professional in commercial real estate brokerage, leasing, asset management, valuation, and investment analysis. As an experienced expert, a CCIM is an invaluable resource to the commercial real estate owner, investor, and user. John Garabedian has been a chartered real estate broker in the Province of Quebec, Canada since 1987. He gave up his licensed with the ACAIQ at the end of 2007 to pursue a new form of real estate, residential development.
John Garabedian 514.497.4399
Sale Leaseback / Single Tenant Net Lease / Development