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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.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.


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


Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.


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.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson


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.


Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
A sale-and-leaseback between a controlling shareholder and a close corporation removes future appreciation from the corporation.
If real property used by a close corporation has been in service for many years, a sale-and-leaseback could generate a much larger rent deduction for the corporation than its current depreciation deduction.
Disguised dividends: Often, a retired (or retiring) controlling shareholder will enter into a sale-and-leaseback so that the rent payments will supplement his retirement income.
After a sale-and-leaseback has been entered into, the controlling shareholder will receive a step-up in the depreciable basis of the building for the portion of the purchase price allocated thereto.
A shareholder may seek to enter into a sale-and-leaseback to generate passive rental income to offset against passive losses.