Sale-Leaseback Transaction

[seyl-LEES-bak trans-AK-shuhn]

What is the definition of Sale-Leaseback Transaction?

A financial arrangement in which a property owner sells an asset, typically real estate, to a buyer and then leases it back from the buyer. This enables the seller to continue using the asset while converting it into capital.

Using Sale-Leaseback Transaction in an Example

A company owning a large office building may engage in a sale-leaseback transaction to free up capital while maintaining its office operations in the same building. By selling the property to an investor and leasing it back, the company can invest the proceeds from the sale into its core business activities.

Using Sale-Leaseback Transaction in a sentence

The CFO explained that the sale-leaseback transaction would provide us with the necessary liquidity to expand our operations without having to move to a new location.

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