TELESEMINAR: Sale / Leaseback Transactions in Real Estate – A National Perspective
April 29, 2014
12:00 – 1:00 p.m.
1.00 MCLE hours
Sale/leasebacks of property are sophisticated real estate transactions where both seller/tenant and investor/landlord can obtain substantial financial, tax and operating benefits. The property owner builds or buys a property it intends to use for its own purposes, sells it to an investor, and then immediately leases it back from the investor for a term of years. Properly structured, the seller/tenant can harvest equity from a building while still using it or finance construction on favorable terms and obtain tax benefits. The investor/landlord can also obtain substantial financial and tax benefits. However, if the transactions are not properly structured, there is a substantial risk of adverse financial and tax consequences, nullifying all economic benefits. This program will provide you with a practical guide to understanding the economics of sale/leaseback transactions, properly structuring these deals, and drafting trips to avoid traps.
- Structuring sale/leaseback transactions in real estate and business
- Reasons for doing a sale/leaseback transaction – tax benefits, liquidity needs, exit strategy for property owner, finance of purchase or construction
- Types of leasebacks – standard/full, partial, short-term, seller-to-vacate
- Practical drafting guidance to avoid common and costly mistakes
- Characterization of transaction as a financing – and financial/tax consequences
- Unwinding sale/leaseback transactions
Richard R. Goldberg, Ballard Spahr, LLP, Philadelphia