sale-leaseback financing

Sale-Leaseback Financing

Sale-Leaseback Financing is a useful tool for companies needing working capital who do not want to use their bank lines, or have credit issues.

Sale-Leaseback Financing

important factors when buying a businessThe last 7 years or so have been a very difficult time for middle / small businesses. The general U.S. economic situation has affected many businesses’ ability to fund the business and generate revenues. During the height of the worst recession (and a near collapse), most capital markets were making it difficult or worse, nearly impossible for small to middle businesses to attract bank financing to run and continue to grow their businesses. Once the economy slowly began to improve and the recession subsided, bank credit and other sources of capital became more available. As the economic recovery slowly continues to build momentum, access to bank capital is somewhat improving.

While banks are still hesitant in pursuing new lending opportunities, we find bank credit is relatively expensive and much more conservatively structured than prior to the recession. Furthermore, small businesses, typically companies with less than $10 million in revenues, are still struggling to find any bank financing at reasonable interest rates and terms.

A businesses’ investment in real estate is often overlooked as possible value in business financing transactions. Many times the real estate is underutilized. Some businesses have used mortgage financing.  An alternative to a mortgage financing that better utilizes a company’s real estate is the sale-leaseback.

Sale-Leaseback Financing Benefits

In the right set of circumstances, a sale-leaseback transaction can have a number of benefits for a small business owner.

  • Retain Control of Real Estate 
  • Set Your Own Lease Terms
  • Tax Savings
  • Comes in at a cost comparable to debt financing and substantially less than the cost of equity
  • Result in off-balance sheet treatment for GAAP purposes
  • Unlocks corporate capital trapped in real estate

elan capital - sale-leaseback financing expertsOur professionals have experience in all aspects of sale-leaseback financing, specializing in working with small and mid-sized businesses in unlocking the hidden value of their real estate holdings.

Is a Sale-Leaseback Financing right for you? Call the Small Business Experts at Elan Capital.

Toll Free 888.615.1418

 

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