leaseback


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Leaseback

A transaction that involves the sales of some property, and an agreement by the seller to lease the property back from the buyer after the sale.

Sale-Leaseback

The sale of a property in which the seller immediately begins to rent the property from the buyer. That is, the seller no longer has ownership of the property, but maintains residence and/or use for the duration of the rental agreement. A sale-leaseback gives the seller profit from the sale while the buyer is guaranteed income from the rental agreement in the medium or long-term. Sometimes, a sale-leaseback occurs in order to grant the seller access to capital to make improvement on the property; for example, the seller may use the proceeds from the sale to build a factory. A form of sale-leaseback, known as sukuk al-ijara, is a common structure for sukuk, or the equivalent of a bond, in Islamic finance. Sale-leaseback is also called simply leaseback.

leaseback

leaseback

an arrangement which involves the selling of an ASSET by the owner to another person or company on condition that the asset is then LEASED (rented back) to the original owner for a specified period of time at an agreed rental. Leaseback is used primarily as a means of raising finance from the sale of surplus properties while allowing the firm to continue its existing business operations. See LEASING.

leaseback

an arrangement whereby the owner of an ASSET agrees to sell it to another person or company on condition that the asset can be leased to its original owner for a fixed term at a prearranged RENT. Leaseback is normally undertaken to enable companies with large assets such as property to realize cash for use elsewhere in their business.

See LEASE, LEASING.

References in periodicals archive ?
The transaction, which is subject to certain conditions precedent commensurate with the sale and leaseback being fulfilled, is expected to complete in July 2017.
Another advantage to a sale or sale leaseback is for the retailer looking for an existing strategy in selling the business.
We don't do sale and lease-back deals for various reasons" is Asda's only comment, while Morrisons says it has "no plans to do sale and leaseback at the moment", Both companies own 80% to 90% of their property portfolio freehold j I and could potentially free up a lot of capital to invest into new store openings.
Personal usage Leaseback property owners can enjoy the best of both worlds - guaranteed rental income and personal usage.
DTZ was recently involved in the sale and leaseback of a 570,000sqft distribution warehouse on behalf of Somerfield plc.
A number of leading retailers, including Marks & Spencer, Kingfisher and Tesco, have in the past successfully used sales and leaseback to raise capital.
A sale and leaseback may enable the shareholder to generate passive rental income to offset passive losses he or she may have.
After determining that a lease is a section 467 rental agreement, the tax consequences of the lease depend upon the type of section 467 rental agreement involved (disqualified leaseback or long-term agreement versus other rental agreements) as well as the amount of section 467 rent and section 467 interest provided under the lease.
Sale and leaseback secures the future of the Unwins Group under the current management team.
Four tests must be met for a leaseback to be considered valid.
The deal also included a leaseback to the Hudspeths.
M2 EQUITYBITES-December 17, 2014-Medical Properties Trust purchase and leaseback deal expected to close on expedited basis in Q1 2015