In a sale-leaseback (or sale and leaseback), a company sells its industrial real estate to an investor for money and simultaneously enters into a long-lasting lease with the new residential or commercial property owner. In doing so, the business extracts 100% of the residential or commercial property's value and converts an otherwise illiquid property into working capital, while maintaining full functional control of the center. This is a fantastic capital tool for companies not in business of owning property, as their real estate possessions represent a significant money value that could be redeployed into higher-earning sectors of their company to support growth.

What Are the Benefits?
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Sale-leasebacks are an attractive capital raising tool for lots of business and use an alternative to traditional bank financing. Whether a company is aiming to buy R&D, broaden into a new market, fund an M&A deal, or merely de-lever, sale-leasebacks act as a tactical capital allocation tool to money both internal and external development in all market conditions.

Key Benefits Include:

- Immediate access to capital to reinvest in core business operations and growth initiatives with higher equity returns.

• 100% market value awareness of otherwise illiquid assets compared to debt alternatives.
• Alternative capital source when conventional funding is not available or restricted.
• Ability to maintain functional control of property without any interruption to day-to-day operations.
• Potential to acquire a long-lasting partner with the capital to money future expansions, building renovations, energy retrofits and more.
  
  Who Gets approved for a Sale-Leaseback?
  
  There are a number of factors that determine whether a sale-leaseback is the best fit for a company. To be eligible, companies need to satisfy the following criteria:
  
  Own Their Realty
  
  The very first and most obvious requirement for qualification is that the business owns its realty or have a choice to purchase any existing leased space. Manufacturing facilities, home offices, retail areas, and other kinds of real estate can be potential candidates for a sale-leaseback. Unlocking the worth of these places and redeploying that capital into greater yielding parts of the organization is an essential chauffeur for companies pursuing sale-leasebacks.
  
  Be Willing to Commit to Operating in the Space
  
  While the term of the lease in a sale-leaseback can differ, a lot of financiers will desire a dedication from a future renter to inhabit the space for a 10+ year term. Assets crucial to a business's operations are typically excellent prospects for a sale-leaseback since a company wants to sign a long-lasting lease for those places. This makes it a more appealing financial investment for sale-leaseback investors as they have more security that the renter will remain in the facility for the long term.
  
  Have a Profile
  
  Companies do not need to be investment-grade quality to pursue a sale-leaseback. However, some credit history is generally needed so the sale-leaseback investor knows that the company can make rental payments over the course of the lease. Sub-investment-grade companies are still qualified as long as they have a strong track record of earnings and cashflow from which to judge their credit reliability