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Many companies have a large part of their equity tied up in their real estate assets, despite not being in the business of real estate. In a sale-leaseback, a company sells its real estate to an investor like W. P. Carey for cash and simultaneously enters into a long-term lease. In doing so, the company extracts 100% of the property’s value and converts an otherwise illiquid asset into working capital to grow its business, while maintaining full operational control.
Sale-leasebacks enable the seller/tenant to:
Sale-leasebacks can benefit the seller and prospective tenant in several ways. See below for European sale-leaseback examples.
"We are pleased to have W. P. Carey as our new landlord and long-term partner. We look forward to working together in the future as Danske Fragtmænd seeks to expand its market share across Denmark."
Jørn P. Skov
CEO of Danske Fragtmænd
Sale-leaseback proceeds funded exit strategy for institutional owner following a shift in its geographic focus. The initial sale-leaseback proceeds, in addition to two follow-on forward commitments to acquire additional facilities, also enabled Danske to expand its market share across Denmark.
| Sale-Leaseback Investment & Follow-on Acquisitions | DKK 1.2 billion ($179 million) in sale-leaseback funding and DKK 132 million ($20 million) in follow-on forward commitments |
| Property Details | 15-property logistics portfolio including five regional distribution hubs, nine last-mile distribution facilities and a corporate HQ |
| Location | Denmark |
| Square Footage | 2.0 million |
Sale-leaseback proceeds reduced debt and enabled tenant to redeploy capital to increase the government’s budget initiatives.
| Sale-Leaseback Investment | €300 million ($332 million) |
| Property Details | Portfolio of 70 regional government office buildings |
| Location | Spain |
| Square Footage | 2.8 million |
Sale-leaseback proceeds funded working capital, provided stability to tenant and helped reduce debt.
| Sale-Leaseback Investment | €43 million ($48 million) |
| Property Details | Logistics facility |
| Location | Portugal |
| Square Footage | 534,000 |
W. P. Carey Inc. (NYSE: WPC), one of today’s largest diversified net lease REITs, provides long-term sale-leaseback and build-to-suit capital solutions primarily for companies in the U.S. and Northern and Western Europe. We are well positioned with the capital and experience needed to maximize efficiency and ensure certainty of close on complex, single and multi-country deals that meet our investment criteria.
Portfolio data is as of December 31, 2019.
