Sale-Leaseback
A real estate sale-leaseback transaction occurs when a healthcare provider sells the real estate utilized for their services and leases it back as a tenant from the new owner. This structure is often considered a form of corporate financing and releases dormant equity from real estate that can be redeployed into the business without conventional and restrictive bank covenants. Common uses include practice expansion, debt retirement, mergers and acquisitions, and cost-intensive capital improvements. For the real estate investor, a sale-leaseback transaction provides a stabilized income-producing commercial property with a long-term net lease.