Commercial strategy
Sale-leaseback for Cheyenne business owners
Unlock the equity in your building, keep your business right where it is, and put the cash to work.
How it works
Sell the building, keep the keys
A lot of Cheyenne business owners have more money tied up in their building than in anything else they own. A sale-leaseback turns that equity into cash without moving out. You sell the property to an investor and sign a lease at the same closing, so your customers, employees and address stay the same.
Owners use the proceeds to pay down debt, buy equipment, open a second location, fund a buyout or simply step back from owning real estate. The tradeoff is that you become a tenant, so the lease has to be one your business can live with for years.
Is it a fit?
When a sale-leaseback makes sense
You plan to stay put
The building suits your operation and you expect to be there for the length of the lease, often ten years or more.
Your equity is stuck
Most of your net worth is in the building and you would rather have it working in the business.
Your business is steady
Investors price these deals on your ability to pay rent. Clean financials help you get a better price.
You want out of landlord duties
Depending on the lease, the new owner may handle some building issues, while a triple net lease keeps most costs with you.
Labeled example
How the math can look
Example only. These numbers are made up to show the math and are not an offer, an appraisal or a market quote.
Say a business agrees to pay $120,000 a year in rent on a triple net (NNN) lease, meaning the tenant also covers taxes, insurance and maintenance. If an investor will accept a 7.5% cap rate, the price works out to $120,000 divided by 0.075, or about $1,600,000. At an 8.0% cap rate the same rent supports about $1,500,000. Small changes in rent, lease length or cap rate move the price a lot, which is why the lease terms deserve as much attention as the price.
Mariah, a CCIM, can run this for your property using current rents and recent sales so you see real numbers before you commit to anything.
What investors look at
What drives your price
Lease length and renewal options
Longer committed terms generally support a stronger price.
Rent and escalations
Market-level rent with scheduled bumps is easier to sell than rent that looks inflated.
Tenant strength
Years in business, financial statements and any personal guarantee all matter.
The real estate itself
Location, condition, zoning and how easily the building could be re-leased if your business ever left.
Selling instead?
Pair it with a 1031 exchange
If you would rather trade into a different investment property, or you are the investor buying a sale-leaseback, read the 1031 exchange guide. The deadlines are strict, so plan early.
From a client
Commercial clients on Mariah
“Her expertise spans far beyond residential real estate and she's also highly knowledgeable in commercial properties and land, making her a true asset in any transaction.”
Cheyenne commercial
Commercial property on the market
A few of Mariah's current Cheyenne commercial and investment listings.
FAQ
Common questions
What is a sale-leaseback?
You sell the building your business occupies to an investor and sign a lease to stay in it. You get the equity out in cash, the investor gets a tenant from day one, and your business keeps operating without a move.
Who buys sale-leaseback properties?
Usually private investors, 1031 exchange buyers and small funds looking for a building with a committed tenant already in place. The strength of your business and the lease terms matter as much to them as the building does.
How is the price set?
Mostly by the rent and the cap rate an investor will accept. Higher rent or a longer lease generally supports a higher price, but rent set too high can strain your business, so the number has to work for both sides.
Are there tax consequences?
Yes. Selling can trigger capital gains, and rent you pay is generally a business expense. Every situation is different, so run the numbers with your CPA before you decide.
Can I buy the building back later?
Sometimes. A repurchase option can be negotiated into the lease, but not every investor will agree to one. Mariah can tell you what buyers in this market are likely to accept.
What is your building worth?
Call or text Mariah for a confidential look at what an investor might pay for your property and what lease it would take.
This page is general information, not tax, legal or lending advice. Talk with your CPA, attorney and lender before you sign anything. Market figures are from the sources named next to them, with the period stated, and change month to month. Listing information is deemed reliable but not guaranteed. Mariah Jeffery, Ph.D., CCIM, is a REALTOR® licensed in Wyoming and Colorado with Coldwell Banker The Property Exchange, 255 Storey Blvd, Cheyenne, WY 82009. Equal Housing Opportunity.