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ACM offers a solution to corporations wishing to restructure or to strengthen their balance sheet with creative financing solutions, via the sale-leaseback of corporate real estate assets.

Alliance Capital Markets (ACM) Structured-Finance Advantages

The sale and lease-back of corporate properties can offer organizations many benefits:
  • Sale-Leaseback transactions allow your company to free-up capital to pay down debt, fund mergers and acquisitions or to re-allocate capital for more productive uses.

  • Your company maintains full operational control of the property.

  • You can offset lease costs as an operating cost, resulting in tax benefits to your company.

  • Your real estate becomes liquid by monetizing low-return/non-return assets.

  • There are possible repurchase options available through various transaction structures which will meet FASB 13/98. This simply means that you don’t have to give-up long-term control and ownership of your asset, if you wish to maintain these features.

  • Transactions can be brought to market within 21 days and completed in 60-120 days. This is a very quick turnaround, and can benefit you if you have a short time horizon with regard to tax strategies.

  • Almost all transactions are structured as off-balance sheet operating leases. Therefore, the corporation’s balance sheet no longer reflects a large, illiquid asset carried at a below-market value. This can protect your corporation from aggressive take-over moves from competitors, speculators or arbitragers.

  • When compared to mortgage debt, the leaseback transaction produces greater leverage, typically 30-35% more.

  • The typical weighted average cost of capital (WACC – The blended cost of the debt component and equity hurdle being considered, or the typical operating margin of the company) for most organizations is approximately 14-18%. A leaseback is typically completed at a reversion rate of 5-8%, depending on credit rating and term.

“Alliance Capital’s team was able to create a positive credit enhancement vehicle which solved questions ,we encountered in the marketplace and they were able to promote out company strategy as well as anyone in our organization.