SAB placed a $5M industrial sale leaseback (“SLB”) in the South Bend–Mishawaka Metro. The SLB proceeds funded 100% of the capital required to purchase a label manufacturer + its plant. This provided the business acquirer with a non-dilutive and covenant-free source of financing, at an interest rate handsomely cheaper than bank or corporate debt. This strategy provided the business acquirer with a unique opportunity to purchase tactical labeling capabilities at a below-market earnings multiple.
For acquirers or owners of companies that exist to make products, provide services, and/or administer care; monetizing profit-center real estate (land & buildings) can arm you with non-dilutive growth capital on a covenant-free lease without personal recourse, and unlike mortgages that max out at 50%-80% property value, SLBs extend 100%-asset value. This provides funding for operations tied to the profit-generation of your product, service, or care.
To learn more about how your properties are positioned in the sale-leaseback capital markets, please contact bhuber@sabcap.com.
