How Grocers Can Unlock Capital Through Real Estate
April 7, 2023 – SLB Capital Advisors shared perspectives with Progressive Grocer regarding the sale leaseback as an attractive capital source in the grocery space
- SLB Capital Advisors’ Partner Malik Franklin shared perspectives with Progressive Grocer regarding the sale leaseback as an attractive capital source
- “What many grocers may not realize . . . is that the capital they need might already be within their grasp, or to be specific, beneath their feet, in the form of the real estate their facility stands on.”
- “Sale leaseback transactions are particularly suitable for grocers, since many operators own their properties. And, while senior management might be uncomfortable with the thought of giving up control of an owned property that’s integral to the business, relinquishing ownership doesn’t mean losing control over mission-critical facilities. In fact, the long-term lease that’s part and parcel of a sale leaseback offers grocers a similar level of control as if they still owned the property. A typical sale leaseback term generally spans 15 years or longer, with renewals extending for an additional 20 years or more at the tenant’s option, providing effective control for 35 to 40-plus years.”
- “The challenges grocers face now, particularly increasing costs, supply chain disruptions, labor shortages, changing consumer behavior and fierce competition, may persist . . . Accordingly, the capital that a sale leaseback transaction provides may be more important now than ever.”
- Read the full article here.