- Trending News
- Stock Exchange News
- Market Movers
- Tech Stock News
- Market Trends
- Consumer Stock News
- Crypto News

- How to Invest Money
- What to Purchase
- How to Purchase Stocks
- How to Buy ETFs
- How to Purchase Index Funds
- How to Invest in Bonds
- Financial Dictionary

- Retirement 101
- Kinds Of Retirement Accounts
- How to Add to 401k/IRA?
- Strategies to Save for Retirement
- Asset Allocation for My Age
- Best IRA Brokerage Accounts
- Withdrawal Rules for 401( k) Plans

- Best Credit Cards
- Compare Credit Cards
- Charge Card Reviews
- Credit Card Guides and Tools

- About Us
- Contact Us
- Investing Philosophy
- Motley Fool Money
- The Motley Fool Foundation
- Reviews
- Newsroom

- Our Services
angle-down angle-up Motley Fool Services
- All Services
- Stock Advisor
- Epic
- Epic Plus
- Fool Portfolios
- Fool One

- Podcasts Home
- Motley Fool Money
- Rule Breaker Investing

- The Motley Fool Foundation

Founded in 1993, The Motley Fool is a monetary services business devoted to making the world smarter, happier, and richer. The Motley Fool reaches countless people on a monthly basis through our premium investing services, totally free guidance and market analysis on Fool.com, premier podcasts, and non-profit The Motley Fool Foundation.

Stock News
- Trending News
- Stock Market News
- Market Movers
- Tech Stock News
- Market Trends
- Consumer Stock News
- Crypto News

- Stock Exchange Indexes Today
- Most Active Stocks Today
- Today's Biggest Stock Gainers
- Today's Biggest Stock Losers
- Largest Market Cap Companies
- Market Research
- Breakfast News

- Top Stocks to Buy Now
- Best ETFs to Buy
- Best AI Stocks
- Best Growth Stocks
- Dividend Kings
- Best Index Funds
- Next Cryptos to Explode

- Technology
- Energy
- Real Estate
- Healthcare
- Durable goods
- Materials
- Industrials

Investing 101
- How to Invest Money
- What to Purchase
- How to Invest in Stocks
- How to Invest in ETFs
- How to Invest in Index Funds
- How to Invest in Bonds
- Financial Dictionary

- Stock Market 101
- Kinds of Stocks
- Stock Market Sectors
- Stock Market Indexes
- What Are Stock Splits?
- What Is Compound Interest?
- After Hours Trading

- How to Buy Stock
- Best Brokers for Beginners
- Best Brokerage Accounts
- Good Time to Buy Stocks
- How Many Shares to Buy?
- Portfolio Diversification
- Long Term Investing Strategies

- Magnificent Seven Companies
- Warren Buffett Investments
- Buying ChatGPT
- Buying SpaceX
- Buying OpenAI
- Buying Nvidia
- Buying Databricks

Retirement Essentials
- Retirement 101
- Types of Retirement Accounts
- How to Contribute to 401k/IRA?
- Strategies to Save for Retirement
- Asset Allocation for My Age
- Best IRA Brokerage Accounts
- Withdrawal Rules for 401( k) Plans

- Social Security 101
- When to Start Social Security?
- Full Retirement Age
- COLAs
- Calculate Your SS Benefits
- Collecting Spousal Benefits
- Maximize Social Security Benefit

- How Much Do I Need to Retire?
- When To Retire
- 401( k) Plans
- 403( b) Plans
- Roth IRA Plans
- IRA Plans
- HSA Plans

- Complete Retirement Guide
- Best & Worst States to Retire
- Average Retirement Savings
- Moving for Retirement
- Healthcare in Retirement
- Understanding Taxes in Retirement
- 401( k) Minimum Distributions

Credit Cards
- Best Credit Cards
- Compare Credit Cards
- Credit Card Reviews
- Charge Card Guides and Tools

- Best Savings Accounts
- Bank Reviews
- Best Personal Loans
- Personal Loan Reviews

- Best Mortgage Lenders
- Current Mortgage Rates
- Mortgage Lender Reviews
- Guide to Mortgages

- Auto Insurance
- Home Insurance
- Life Insurance

Who Is the Motley Fool?
- About Us
- Contact Us
- Investing Philosophy
- Motley Fool Money
- The Motley Fool Foundation
- Reviews
- Newsroom

- Facebook
- Twitter
- YouTube
- Discussion Boards
- CAPS - Stock Picking Community

- Advertise With Us
- Become an Affiliate Partner
- Publishing Standards

- All Services
- Stock Advisor
- Epic
- Epic Plus
- Fool Portfolios
- Fool One

Founded in 1993, The Motley Fool is a monetary services company dedicated to making the world smarter, happier, and richer. The Motley Fool reaches countless individuals each month through our premium investing options, totally free assistance and market analysis on Fool.com, individual finance education, top-rated podcasts, and non-profit The Motley Fool Foundation.

Key Points

-.
Sale-leaseback frees up capital for sellers while ensuring they can still utilize the residential or commercial property.

-.
Buyers get a residential or commercial property with an instant money flow through a long-term tenant.

-.
Such deals assist sellers invest capital elsewhere and support expenses.
-.
Investor Alert: Our 10 best stocks to purchase right now 'A sale-leaseback deal allows owners of genuine residential or commercial property, like realty, to release up the balance sheet capital they've purchased an asset without losing the capability to continue utilizing it. The seller can then utilize that capital for other things while the purchaser owns an instantly cash-flowing property.

What is it?

What is a sale-leaseback deal?

A sale-and-leaseback, also referred to as a sale-leaseback or just a leaseback, is a financial transaction where an owner of a possession offers it and then leases it back from the new owner. In genuine estate, a leaseback permits the owner-occupant of a residential or commercial property to offer it to an investor-landlord while continuing to inhabit the residential or commercial property. The seller then becomes a lessee of the residential or commercial property while the buyer ends up being the lessor.

How does it work?

How does a sale-leaseback deal work?

A property leaseback deal consists of two associated agreements:

- The residential or commercial property's existing owner-occupier agrees to sell the property to a financier for a fixed cost.

- The brand-new owner consents to rent the residential or commercial property back to the existing occupant under a long-term leaseback agreement, therefore becoming a landlord.


This deal enables a seller to remain a resident of a residential or commercial property while transferring ownership of an asset to an investor. The buyer, meanwhile, is buying a residential or commercial property with a long-lasting tenant already in place, so that they can start creating cash circulation immediately.

Why are they utilized?

Why would you do a sale-leaseback?

A sale-leaseback transaction advantages both the seller and the buyer of a residential or commercial property. Benefits to the seller/lessee consist of:

- The ability to release up balance sheet capital invested in a property possession to fund service growth, minimize debt, or return money to investors.

- The ability to continue occupying the residential or commercial property.

- A long-term lease arrangement that locks in costs.

- The capability to subtract lease payments as an overhead.


Likewise, the purchaser/lessor likewise experiences a number of gain from a leaseback deal, including:

- Ownership of a cash-flowing possession, backed by a long-term lease.

- Ownership of a residential or commercial property with a long-term lease to a renter that needs it to support its operations.

- The capability to subtract depreciation expenses on the residential or commercial property on their income taxes.


Real Estate Investing

When buying property, you have numerous alternatives.

Basics of Real Estate

Realty can be a great addition to your portfolio, with numerous different financial investment choices.

Commercial Real Estate

Knowing industrial genuine estate investing finest practices can assist guarantee success.

Real Estate Investment Trusts

REITs are a lower-cost option for investing in industrial realty. Learn more about how they work and if they're best for you.

Related Articles

Our Guides

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio assistance, and more from The Motley Fool's premium services.

Making the world smarter, happier, and richer.

Facebook Facebook.
Twitter Twitter.
Linked In LinkedIn.
Pinterest Pinterest.
YouTube YouTube.
Instagram Instagram.
Tiktok TikTok

© 1995 - 2025 The Motley Fool. All rights booked.