Need property sale and leaseback option

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March 01, 2025

by a searcher from Northumbria University - Newcastle Business School in London, UK

We are looking to purchase a business in the US that comes with property. The property is privately owned by the seller, and he pays himself a current rent ~$20k/mth. As part of the sale, he also wants to sell the property, but we are not too keen on owning the property as it just increases the price. Question therefore - would anyone know a good sale and leaseback option for the property or any other structure that would enable us to complete the transaction?

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Reply by a searcher
from University of Washington in Seattle, WA, USA
Hi Alex, you may explore those options: - Some well-known firms include: W.P. Carey, Realty Income Corp, STORE Capital. These firms typically structure leases with long terms###-###-#### years) and escalations. - Some REITs focus on sale-leaseback transactions like Global Net Lease could be potential partners. If a sale-leaseback isn’t feasible or desirable, consider: - Seller holds property & leases it to you at a market rate. This could be triple net (NNN), where you cover taxes, insurance, and maintenance, making it attractive for the seller. You get operational control without the capital outlay.
- Find a buyer before closing: Structure the deal so that at closing, a third-party real estate investor acquires the property and simultaneously leases it to you. You never take ownership of the real estate, reducing capital requirements.

-Lease with an option to buy: If you're uncertain about long-term property ownership, negotiate a lease with a purchase option.. This gives flexibility to buy later if it becomes beneficial.
-1031 Exchange Buyer: If the seller is motivated to sell the property, look for an investor looking to execute a 1031 exchange (tax-deferred real estate reinvestment). Many investors need to place funds in qualifying real estate assets quickly and might be open to buying the property and leasing it back to you.

Hope that helps!

Best,
Mo
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Reply by a searcher
from Biola University in Cleveland, OH, USA
Alex - per Mark's comment, Acquiring Minds just did a webinar with the managing director of Stream Capital about this very thing. Check it out here: https://acquiringminds.co/webinars/using-a-sale-leaseback-to-buy-a-business
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