Leaseback Investments

A leaseback investment is a unique arrangement in which a buyer purchases a property with the intent of leasing the property back to the seller immediately. Also referred to as "sale and leaseback," this arrangement provides a way for the original owner to utilize the property in question without tying up capital. Sometimes, significant tax benefits can be realized as well.

The buyer of leaseback property also stands to benefit from this type of arrangement. Since the buyer of the property essentially becomes the lessor, he or she is able to collect stable payments for the period of time agreed upon in the lease arrangement. This guaranteed rental situation could result in significant income for the buyer/lessor. Furthermore, the buyer can take advantage of the depreciation of the property on his or her tax return.

Often, leaseback investments involve long-term net lease agreements that afford the seller/tenant of the property the option of repurchasing the property in the future. Common in the United States since the 1940s, leaseback arrangements provide strategic ownership and investment options. These arrangements are also used as alternatives for meeting financing and risk allocation needs.

At TM 1031 Exchange, we work to fulfill the needs of investors and their agents, assisting them in finding suitable investment properties. We seek to form and maintain long-term relationships with investors, property owners, and developers, helping them to develop investment strategies to achieve their unique goals. To learn more about our services, please call us toll-free at 1-877-4TM-1031. You may also reach us by e-mail at info@tm1031exchange.com