Sale/Lease-Back - What's the Point?
By Joseph Cacciapaglia
In an earlier post I mentioned several types of businesses that make good sale/lease-back transactions. Since then I've been asked why a business would want to take part in this type of transaction. In a sale/lease-back a owner occupant of a building sells the property and then signs a lease with the new owner to stay in the space. Often a business will do this as a way to unlock the equity that they have in their property. For example, there are several small businesses in Reading, PA that own their own property. These businesses range from retail store owners to small businesses that own the office buildings where they are located. From time to time many small businesses run into cash flow problems. It is common to have a profitable business that for one reason or another does n...