Sale Leaseback: Strategic Liquidity Without Operational DisruptionWhat is a Sale Leaseback (SLB)?Most businesses today are not in the business of owning real estate but still rely on land andbuildings to operate. A SLB allows a company to reduce its investment in these non-core assets and unlocks c…
Sale Leaseback:Strategic Liquidity Without Operational Disruption
What is a Sale Leaseback (SLB)?
Most businesses today are not in the business of owning real estate but still rely on land and
buildings to operate. A SLB allows a company to reduce its investment in these non-core assets and unlocks capital by selling their property and simultaneously leasing it back. This separates the asset’s ownership value from its utility value.
This strategic financing tool empowers businesses to reinvest in their core operations, fund business expansions, or optimize their balance sheets by paying down debt, all while remaining in their current location.
Why Businesses Choose the Sale Leaseback: Strategic Advantages
Create value through arbitrage of EBITDA vs Cap Rate multiples
Convert illiquid asset into cash, optimizing balance sheet
Retain full control of the property on favorable terms
Redeploy capital into highest and best use
Capital without personal guarantees from shareholders
Cheaper than other financing alternatives
Liquidity through non-dilutive capital event
Flexible liquidity without covenants or restrictions
Unlock up to 100% of asset value vs. a mortgage ~60%
Improve tax efficiency without adding debt or leverage
Generally speaking our investment criteria is private for non-investment grade companies, $10M+ in revenue and 25+ employees that could benefit from the bifurcation of the business and real property that meet the characteristics below:
Owns Mission-Critical Real Estate
Properties used for operations, distribution, manufacturing, retail, or healthcare
Has invested significantly in the location, has difficult to obtain CUPs or government approvals (think surgery centers, trash companies, hazardous material handling, logistics or manufacturing)
Liquidity for Transitioning, Growth, Restructuring, or Liquidity
Transition Liquidity, acquisitions, debt reduction, dividend recap, or working capital
Reasonable Business Fundamentals
Stable or growing revenue
Collectively, our Principals and Investment Committee has closed over $25 billion of capital markets and sale leaseback-centric transactions across a variety of industries.
Team (1)
Sectors SLB Capital Group serves:
Manufacturing
Consumer Goods
Industrials
Materials
Retail
Business Services
Technology
Energy & Utilities
Distribution
Health Care
Consumer Services
Financial Services
Life Sciences
Media
Real Estate
Telecommunications
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