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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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved


In a sale-leaseback arrangement -- also known as a leaseback -- an owner sells his or her property, and then immediately leases it back from the buyer as part of the same transaction.

This way, the seller gets the profits from the sale while keeping possession and use of the property, while the buyer is assured immediate long-term income on the property.

Sale-leaseback transactions are most commonly used in commercial real estate, but can also apply to commercial vehicles and other types of property.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
1 October 2018 - Jamaican communications and entertainment provider Digicel has completed a sale and leaseback agreement with US-based wireless infrastructure owner Phoenix Tower International LLC through its Jamaican subsidiary, Phoenix Tower Jamaica Ltd., in relation to a number of its towers in Jamaica, the company said.
Ryanair has reportedly entered into a sale and leaseback agreement for up to ten Boeing 737-800 aircraft.
NORDIC BUSINESS REPORT-7 November 2007-Deep Sea Supply Plc signs new sale and leaseback agreement with Ship Finance International Ltd(C)1994-2007 M2 COMMUNICATIONS LTD
Cyprus-registered Norwegian-controlled offshore supply vessels operator Deep Sea Supply Plc said on Wednesday (7 November) that it has signed a new sale and leaseback agreement with Ship Finance International Limited.
TOP Ships announced that it has obtained non-binding credit committee approval from a major Chinese leasing company for up to $92.5M via sale and leaseback agreements for its Suezmax newbuilding vessels with hull numbers 874 and 875, currently under construction at Hyundai Samho in South Korea.
New York (AirGuideBusiness - Business & Industry Features) Thu, Feb 27, 2014 - Sale and leaseback agreements of two Airbus 330 aircraft owned by Finnair have been finalized.
Under the terms of the definitive sale and leaseback agreements, Quotient will receive gross proceeds from the sale totaling GBP 14.95 million, or $20.9 million.