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If you are looking at opportunities to invest in commercial real estate in Oklahoma, a sale leaseback in Oklahoma might be the right decision for you. A sale leaseback OKC has many benefits for both the buyer and seller, not just one single advantage. Whether or not you should pursue a sale leaseback all depends on what you want from your investment.

 

What Is a Sale Leaseback in Oklahoma?

In a sale leaseback OKC, the buyer will purchase the property and lease it back to the seller. The arrangement typically includes a triple-net lease that lasts for an agreed-upon time frame. A lease of 10-30 years is not uncommon for a sale leaseback in Oklahoma. Typically, the seller will have fixed payments along with amortization of the purchase price. Some leases also give the sellers an opportunity to purchase the property at the end of the term.

 

Buyer Advantages

When a sale leaseback is done correctly, there are plenty of advantages for the buyer. Here are a few things that benefit buyers in sales leasebacks.

Tenancy: In a sales leaseback, buyers automatically have tenants when they make the purchase. There is no gap while looking for someone to rent the space.

Rate of Return: The return on this type of loan is typically higher in a sale leaseback agreement. The buyer has the advantage of using the purchase as leverage for financing, which can increase the return. Additionally, any appreciation in property value will go to the buyer at the end of the lease.

Security: The longer the lease, the more financial security you have when it comes to commercial real estate in Oklahoma. Buyers are protected in the case of market downturns as well as inflation from any appreciation in property value.

 

Seller Advantages

In certain circumstances, a sale leaseback is ideal for the seller. They have the opportunity to stay in their established location while improving their finances.

Liquidity: In this situation, the seller is able to convert their equity into cash without losing possession of their property. In most cases, the seller earns more with a sale leaseback than they would with a traditional mortgage because a mortgage company will often cap the funding at 70 to 80 percent.

Better Credit: The sale of the property transfers a fixed asset into a current asset. Additionally, as long as the sale creates an operating lease, the rent is not seen as a financial liability to creditors. Instead, it will become a footnote on the balance sheet.

Prevent Takeovers: Property that is undervalued can attract people interested in company takeovers. A long-term lease, on the other hand, is less appealing.

These are just a few of the advantages that come with a sale leaseback. As you can see, these agreements can be mutually beneficial to both parties. If you have any questions about a sales leaseback or any other commercial real estate services, please feel free to contact us. Our team is here to help you find the best investment possible.