Find a Sale Leaseback Broker
Are you trying to find a sale-leaseback broker? On top of an established reputation in the single-tenant net lease (STNL) market, Calkain offers sale-leaseback broker services. As a boutique commercial real estate firm, we have grown into one of the largest STNL focused firms in the country. Whether you are a private or institutional investor, we are a sale-leaseback broker firm that prides itself on delivering real estate solutions that maximize value while building wealth for all of our clients.
What is a Sale-Leaseback transaction?
A sale-leaseback occurs when a company sells the land and building used in its current business operations. A Sale-Leaseback transaction allows a franchisee to sell corporately owned real estate and simultaneously lease the real estate back under a long-term lease with the buyer of the real estate. It’s a mechanism to:
- Replenish working capital
- Buy out a partner
- Rebrand/remodel existing locations
Sale-Leaseback strategies have been successfully utilized for years by numerous industries, including retailers, pharmacy chains as well as restaurant operators. With a shortage of retail product in the marketplace, investors have become very comfortable with investing in corporate real estate assets.
Franchisee’s continually face challenges as they look to source capital. For operators that own their own real estate, now is an excellent time to consider a Sale-Leaseback. Compared to conventional debt financing, a Sale-Leaseback has many advantages and in today’s low-interest-rate environment, Sale Leasebacks offer higher yields to investors looking for alternatives to traditional fixed-income investments. Executed properly, it’s a strategic move that allows an owner to unlock the value of the real estate, while still maintaining operational control.
Why do a Sale-Leaseback?
Companies do Sale Leasebacks for a variety of reasons, but generally, do so to use net proceeds of the transaction in order to reinvest in a corporate purpose that produces higher yields. Corporate occupied real estate typically commands a return of 6% to 10%. A company can receive a higher return from allocating its capital to other uses:
- Corporate mergers and acquisitions
- Expanding company operations
- Reducing debt
- Stock repurchases
- A Sale Leaseback is an excellent mechanism to:
- Replenish working capital or buy out a partner
- Provide capital allowing a senior stakeholder to retire and structure an orderly transition to the next generation
- Upgrade company infrastructures
Why Sale Leasebacks are Attractive to the Buyer/Investor?
- The corporate real estate asset is structured as a single tenant net lease (STNL) asset. STNL assets are hands-off, easy to own assets which often appeal to investors who are concerned with the return on capital as much as capital appreciation.
- An STNL has often been called a real estate transaction wrapped in a bond. The STNL investor receives a return which is higher than a bond.
- Corporate real estate assets are often viewed as being internet resistant.
- An STNL asset is often acquired by institutional investors, high net worth individuals or section 1031 tax-deferred investors.
- The creditworthiness of the franchisee is critical to the buyer.
- Like all real estate transactions, location is important to the buyer but the buyer may rely equally as much on quality of the credit of the tenant in making its investment decision.
- The STNL marketplace is one of the more liquid segments of all real estate markets, providing the buyer with flexibility.
Planning for a Successful Sale-Leaseback
There are significant legal and marketing issues that need to be addressed when a company is assembling its Sale-Leaseback team. The right advisers ensure that the company’s value is maximized and the company’s operational interests are protected during the term of the lease which is created during the process.
As with any sale of corporate real estate, matters involving title, environmental issues, deferred maintenance, if any, as well as terms of the existing property financing will need to be reviewed. A law firm should be engaged with expertise in structuring a long-term net lease early in the process.
Selecting the right adviser to effectively market the property and navigate through the process is also critical. That’s why our Sale-Leaseback experts are here to help. Contact us at Calkain today to help you unlock your capital with a Sale-Leaseback.
How can a Calkain Sale-Leaseback Broker Help?
Although the reasons for considering a sale-leaseback are numerous and often attractive, the execution can be complicated. Out Sale-Leaseback experts are focused on net lease and we have seen that most Sale Leasebacks occur in the Net Lease Market. We are knowledgeable and can help work with your specific needs to help you generate more capital to help grow your business. Whether you have a portfolio or one store, the experts at Calkain will work with you to help unleash the capital of your asset. Together we can reduce occupancy costs create an exit strategy, unlock capital to build your infrastructure, or help you grow. Calkain will help simplify the process and be with you every step of the way. Calkain knows Sale Leasebacks in the Net Lease Market. Contact us today to find your Sale-Leaseback Broker.Find a Sale Leaseback Broker