We help restaurants generate liquid capital with sale-leasebacks.
Establishing a lease-leaseback with ZEL Capital is a smart strategy for restaurants and food chains who want to start new developments or cash out early.
Sale-leasebacks benefit restaurants in a variety of ways.
How Restaurants and Franchises Win with Sale Leasebacks
It’s a win-win for everyone. Restaurant owners get to cash out early with no recourse and a fair buyout. The best part? The new lessee is able to keep existing managers and get a return on the leasehold. Creating a sale leaseback agreement with ZEL Capital’s restaurant investors is a smart strategy for established restaurants, franchises and larger restaurant chains.
How Sale Leasebacks Work
A sale-leaseback is simply a buying operation that allows the seller to cash out. From a real estate standpoint, the deal is straightforward. Once a clients purchases the restaurant or franchise’s property, the title is transferred and the restaurant or franchise owner becomes the tenant. All deals are made under a master lease that can be extended and expanded into a sublease.
For the new lessee, a non-recourse management agreement will be created. Non-recourse agreements protect the restaurant owner and their assets; the only repayment required is the value of the purchased real estate. Management agreement and lease terms can be extended throughout the deal. A cash security deposit and letter of credit may be required depending on two factors:
- NOI (or Net Operating Income) to ensure sufficient, consistent payments
- Level of risk restaurant or franchise owner is willing to take
Disadvantages of Restaurant Sale Leasebacks
There are no disadvantages or major risks involved with arranging a sale leaseback for your restaurant (it’s a win-win for the seller and purchaser). The seller receives cash for their real estate and the buyer gains a restaurant investment. The only foreseeable risk is if the restaurant under performs after the sale. If the lessor can’t keep up with payments, they might lose some or all of their security deposit and will have to find an alternative way to pay rent. Both the seller and the buyer have the option to terminate the lease and walk away from the deal. Although this is an economic risk to consider, it’s important that you know ZEL Capital Partners is here for the long run. All sale-leaseback and management agreements are structured to protect your business.
Why Team with ZEL Capital for a Restaurant or Franchise Sale Leaseback Agreement?
Our team of investors is qualified and experienced, serving a variety of franchises and privately-owned restaurants. We are solely interested in purchasing your real estate assets and seek quality business that has the capability to manage all business operations. Our sale-leaseback agreements are altered to fit your restaurant’s needs and are structured to protect your business.
This sale-leaseback structure gives hotels, resorts, and other facilities an advantage. generate liquid capital while keeping existing management in place.
Generate Liquid Capital with Sale Leasebacks
A risk-free solution for business owners looking to cash out early or to secure capital for growth
We can help our client’s access capital through the monetization of business real estate assets via sale-leaseback transactions to provide capital for expansion or growth.