Today we talk with Luke Timmis of Signature Associates about sale-leasebacks and how they can be attractive as an alternative method of raising capital.
Today we talk with Luke Timmis of Signature Associates about sale-leasebacks and how they can be attractive as an alternative method of raising capital. Companies with high-cost fixed assets like property, land, or large expensive equipment find this option advantageous, as they can sell their expensive assets or equipment to a buyer and the buyer can then immediately lease those assets or equipment back to the original owner - thus freeing up cash to the original owner. As COVID-19 has thrown the world into uncharted territory, businesses across the globe are finding ways to create liquidity and fuel a comeback. Corporations with owned real estate, however, have a unique advantage to extract capital at above-market pricing for its properties by utilizing sale-leasebacks.
Key Discussion Points
[00:00] Welcome and introduction by Eric Odum
[00:32] About our guest, Luke Timmis
[01:28] Why would a corporation be interested in selling their underlying real estate?
[03:38 What type of company might be interested in doing a sale-leaseback?
[07:49] What type of company are you trying to go after that you think would be the best fit for a sale-leaseback
[09:39] What are the tax implications of a sale-lease-back?
[14:47] Tell us more about the structure of these leasebacks
[16:05] How do you reconcile the gap between the market and the seller who might be a little unrealistic?
[20:04] How can folks get in contact with you?
[20:46] Tell us about your brokerage firm's (Signature Associates) coverage area and what other asset classes does it engage in?
Director of Investment Division, Signature Associates Commercial Real Estate/TCN Worldwide
Luke specializes in investment sale transactions with a primary focus on sale-leaseback transactions nationally. Luke founded The Sale-Leaseback Team in 2015 and has been responsible for over $200 million of transactions in that span.
In 2016, Griffin Pitcher was recruited to the platform, and since then the two have become the #1 investment professionals companywide. The team gained significant traction in 2018 as they provided sale-leaseback analyses for 24 private equity firms on the front end of 74 M&A transactions. This led to the team capturing a significant market share of the private equity-sponsored sale-leasebacks transacted nationally.
Luke graduated from Marquette University, where he majored in finance and real estate, and played defense on the school’s first-ever Division 1 lacrosse team. Today, Luke coaches his high school alma mater (Brother Rice) and in five years has placed 13 student-athletes to play at the NCAA Division 1 level.
Luke can be reached at (248) 359 0608 or emailed at firstname.lastname@example.org.