What is a Sale-Leaseback?
In a sale-leaseback for Cold Storage, also known as just a leaseback, a company sells its real estate to an investor like Point Acquisitions and simultaneously enters into a long-term lease. In doing so, the company extracts 100% of the property’s value and converts an otherwise illiquid asset into working capital to reinvest in its business or pay down debt, while maintaining operational control.
To successfully execute a sale leaseback transaction, both the seller (now the lessee) and the buyer (now the landlord) must agree on the following terms:
- Sale of the Property: As the current owner, you agree to sell your commercial property for a predetermined price, converting a high-cost fixed asset into immediate capital.
- Leaseback Agreement: The buyer, who becomes the new owner, agrees to lease the property back to you under a long-term lease. You, as the tenant, retain operational control of the property, continuing your business activities without disruption.
Benefits of a Sale-Leaseback for Cold Storage
Immediate Access to Capital
Deploy as needed, whether recapitalizing your balance sheet or spending on new acquisitions/R&D.
Alternative Capital Source
When conventional financing is limited, access cash with fewer restrictions or contingencies.
Market Value Realization
Convert otherwise illiquid assets into cash at a rate determined by the market, compared to debt alternatives.
Retain Operational Control
Structured leases allow for continued operation of your facility under your direction as normal.
Potential Tax Benefits
Sale leasebacks often allow you to deduct rent payments as a business expense, potentially providing additional tax deductions and enhancing your overall tax strategy.
Gain a Long-term Partner
We are capitalized to support future expansion, build-to-suits, renovations, energy retrofits and more.