SALE LEASEBACK AND CREDIT TENANT LEASES
A sale leaseback or credit tenant lease program can be an effective way to reduce the negative impact of real estate ownership while simultaneously obtaining low-cost financing. Using this program, you “sell” your real estate to Wachovia, and we lease it back to you for a fixed period as the lessor/owner. You effectively control the property after the sale, and retain the right to buy back the property at a pre-agreed price.
Advantages of Sale Leaseback
- Generates cash, improving liquidity
- Provides off-balance sheet financing
- Allows you to focus your assets on core operations
- Provides more efficient utilization of real estate tax benefits, if your company has a net operating loss
- Reduces the negative impact of depreciation and interest on your income statement
- Improves financial and performance measurement ratios such as return on assets
- Hedges against obsolescence
- May help you avoid or reduce liability for minimum tax, because tax-oriented leasing, unlike ownership, does not create tax preference items
Wachovia can help you discover the right financing vehicle from a wide range of alternative strategies.
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