Small Business Credit Crunch Solution – Commercial Property Sale and Lease Back

To Let or For Sale - Commercial property sale and lease backCredit crunch today left small businesses financially strained, pushing small business owners to restructure their businesses’ debt strategically and tactically.

If you run your business on your owned commercial property, you might want to consider selling your property and rent it back to solve some of your business’ financial issues.

Despite all the negative reputation lingering property sale and lease back businesses, they are indeed helpful to property owners in surviving credit crunch today.

Why negative reputation? The business concept itself is ‘sustainable’ and could be considered good ‘deed’ – helping financially-strained property owners by purchasing their properties and rent them back – this way, property owners receive much-needed fund to solve their financial issues. Unfortunately, not all sale and lease back businesses honour ethical business practices by implicitly or explicitly push the tenant out ‘naturally’.

Nevertheless, there are ethical and reputable commercial sale and leaseback companies that offer a win-win situation to the property owners.

Property sale and lease back for small business

Although many serve home owners, some property sale and lease back businesses do specialise in acquiring and renting back commercial properties.

You can sell commercial property to reputable real estate company that is not only serving commercial sale, but also offering lease back option.

What kind of commercial properties do owners can sell and rent back? Lands, office facilities, undeveloped properties, hotels and retail units – every premise that business transaction is being held can be categorised as commercial property.

How to choose the right commercial property sale and lease back company

I have a several tips for you who consider to sell your business premise and rent it back:

  • Choose a company specialising in commercial sale and lease back.
  • Choose a company that offers transparency in sell and lease back agreement regarding the transaction fee, rental fee, property valuation methods, etc.
  • Seek recommendations from your relatives, colleagues, and business network – some of the best companies to partner with are introduced through the ‘inner circle’.
  • Seek and negotiate for an option to purchase your commercial property back at fair market value.

How to decide whether you need to sell your commercial property or not

The decision is yours, but I recommend you to consider your business first – will it not only survive and thrive in today’s recession that could last for a few years to come? If so, you should consider sell your business premise, restructure your debt, and rent your property back.

Look into your balance sheets and profit-and-loss statements, and consult with your financial advisors or accountants whether selling the property will benefit your business in the long run.

Ivan Widjaya
Business debt restructuring through sell and lease back
Image by Fortyseven.