Sale and leaseback: turning the company's buildings into cash
In brief. In a sale and leaseback the company sells its buildings to an investor and keeps using them under a long lease. It can release up to 100 % of the building's value, against roughly 50 to 60 % with a mortgage loan, in exchange for rent over 15 to 20 years.
A worked example
A plant is worth EUR 30 m. A fund buys it at a 7 % yield: the company receives EUR 30 m and pays EUR 2.1 m of indexed rent a year, covering taxes, insurance and maintenance. A mortgage on the same building would have raised EUR 15 to 18 m.
Recent deals
- October 2025: Aramco closed an USD 11 bn lease and leaseback of its Jafurah gas facilities for 20 years.
- September 2026: W. P. Carey bought two Purmo Group plants in Poland for EUR 52 m, with Purmo as tenant.
- In 2025, leasebacks were 20.8 % of European supermarket investment (Savills).
Terms to negotiate
- Lease length and indexation.
- A buy-back option at the end of the lease.
- Who pays for major works.
- The right to assign the lease if the business is sold.
Before you sign
The gain on the building is taxable. Under IFRS the lease is a liability. A lease that is too long or too expensive lowers the value of the business in a future sale. A family may instead keep the real estate in a separate company before selling the operating business.
Facing a decision like this?
We read every request personally and reply within 72 working hours when we believe we can be useful. The first review is free and without commitment.
Request a reviewSources
This guide is general information. It is not investment, legal or tax advice. The rules quoted must be checked by your advisers before any decision.