The Basics of a Sale Leaseback

Are you looking for a way to achieve significantly higher real estate values? A sale-leaseback is a financing tool that allows property owners to sell their real estate assets to another buyer as they sign a long-term lease to be the tenant, securing the location in the process. Simply put, the seller of the asset becomes the lessee as the purchaser becomes the lessor.

In the current state of the market, the sale-leaseback is becoming more prevalent across industries. With the numerous benefits that come with it, this is no surprise. Sands Investment Group is here to provide you with the basics of a sale-leaseback, so you can decide whether it is the right fit for your commercial real estate investment decisions.      

Who should consider using a sale-leaseback? 

Often, the most common participants are builders or companies with high-cost fixed assets, in this case, commercial real estate. It allows these people to use the cash they invested in commercial real estate in other ways while still needing the asset to operate the business. 

Does this sound like a financing tool that could benefit you and your business as an investor? Sands Investment Group could be the resource you have been looking for to start.  

What is the process of a sale-leaseback? 

Understanding what a sale-leaseback looks like is one thing, but going through the process is another. At Sands Investment Group, we break down this process into three steps. 

1. Evaluate the Business 
2. Market Analysis 
3. Structuring a Lease

As the overarching tasks, each of these steps breaks down into extensive research tied to the characteristics of your specific case. Find the details here. 

What are the benefits of a sale-leaseback? 

The benefits of a sale-leaseback are broken down into that of the original seller and the purchaser. It creates a mutually beneficial agreement that creates opportunities for both parties to see positive impacts in their financial pursuits.  

For the original seller, one of the first benefits to consider with a sale-leaseback is that it is an alternative method of raising capital. In the instance of a loan, the company must repay the money, making it appear on their balance sheet as debt. With a sale-leaseback, the liability on the balance sheet decreases, while the current assets will increase. It does not present the same appearance of debt in the long-term overview of the business.   

Along with the benefits present on the balance sheet, sale-leasebacks give you the chance to grow your business with ease. This means you can use the capital to open other locations, expand the current company, or acquire another business or real estate property. As you grow, the volatility risks of owning the asset decrease with this method.  

On the other hand, the purchaser can expect benefits as well. From the start, they achieve ownership of a cash-flowing asset that also happens to be backed by a long-term lease. They also know that the long-term lease is tied to someone who wants to be a tenant and continue to utilize the property because of how a sale-leaseback originates. As a result, the purchaser can deduct the property’s depreciation expenses from their income taxes. 

Find the perfect sale leaseback listing for you by looking at the active inventory Sands Investment Group has to offer. 

Work With Sands Investment Group 

The sale-leaseback may be the financing tool you’ve been waiting for to expand your business. Now that you know the basics, it is time to take the next step. Sands Investment Group has experience in all types of commercial real estate to help you navigate leveraging your existing assets for more capital to fund future investments. 

At Sands Investment Group you can find highly personalized client services with an extensive network of investors to help you get started on discovering more about sale leasebacks. Call 844.4.SIG.NNN or find out more on our website.      

Are you interested in investing in commercial real estate? Investing can be crucial to an individual’s financial goals by offering financial security now and in the future. Investing can also allow you to increase your wealth over time as the value of the product increases. With the help of an advisor, you can begin building upon your real estate portfolio. Commercial real estate can offer a passive income with a premium return. 

Owning real estate assets may also allow for resale potential if the situation arises. If you are starting your commercial real estate investment journey, Sands Investment Group has the resources to help you confidently make investment decisions.

What is Commercial Real Estate?

Commercial real estate is different from its counterpart in residential real estate. Commercial real estate, or commercial property, is space used to conduct business, whereas residential real estate is used for living purposes. The commercial real estate industry is intended to generate a profit whether it be from capital gains or rental income. 

To invest in commercial real estate, an investment advisor can give you an overview of each category’s performance, supply, and demand. Then, you can choose what type of commercial real estate works best for you.

Types of Commercial Real Estate:

Commercial real estate can be placed in different categories based on the type of business residing in the space. You may also consider what the purpose of the property is when categorizing. These categories include multifamily, office, retail, industrial, hospitality, and special use. 

At Sands Investment Group, we specialize in the following commercial real estate product types:

• Automotive
• Convenience Store
• Dollar Store
• Drugstore
• Early Education
• Industrial
• Medical
• Office
• Owner-User
• Restaurant
• Retail / Big Box
• Self Storage
• Shopping Centers

Is it Sensible For Me to Invest in Commercial Real Estate?

Many people think of investments as stocks, bonds, mutual funds, or ETFs. However, investments can also be in commercial real estate.  There are numerous types of investments you can capitalize on in the realm of commercial real estate, and ultimately diversification is the key to managing your investment risk. However, successful acquisitions can vary due to multiple factors such as the economy and demographics. 

On the other hand, commercial real estate has proved to be a reliable investment during many market changes. To be successful with this choice of investment, you must set goals and decide what a commercial real estate investment could provide. 

What Type of Investor Are You?

Planning for your financial future entails deciding what the different choices will look like. During this time, you must analyze prior financial statements and determine what its current financial performance has the capacity to obtain. Then, when making investment decisions, you can take the time to evaluate time, risk, and value. This provides confidence in knowing that they will fit into your goals and future plans. Factors such as age, objectives, and tolerance to risk can be essential to what type of investor you are. 

After you determine the type of investor you are, it can help clarify how and why you should invest. Even if you have solid investments in place, you may find it wise to continue building your portfolio to meet financial goals. No two investment portfolios are identical. Investors can choose what options are best suited to their situation. 

Pros and Cons of Commercial Real Estate:

✓ Provide solid and predictable returns on investment over time.

X If not researched, potential risks of the market situation, such as oversupply.

✓ Provide a tangible asset.

X Can miss the property’s history of sales if not enough research is performed.

✓ Builds equity.

X Market cycles are constantly changing and do not last.

✓ Tax benefits from owning commercial real estate.

X Requires a commitment of time to upkeep.

✓ Commercial real estate assets have leverage.

X Maintenance costs may require professional help.

✓ Provide cash flow and more income.

X Requires a more significant initial investment.

Interested in Learning More About This Investment?

If you are interested in investing in commercial real estate, get in touch with a Sands Investment Group advisor to start your journey. Check out our current listings to see which commercial real estate investment would fit your needs. The opportunity you’ve been looking for might be one click away.  To learn more, get in touch with an expert today by calling 844.4.SIG.NNN or sending us an email at info@SIGnnn.com. 

Thinking of expanding your portfolio by investing in the car wash industry? Owning a car wash can be a profitable addition to your work. Many car washes are owned by small business owners who started their investment journey. In fact, only 10% of car washes are not owned by small business owners. It may be time to invest in the car wash industry and all the opportunities it has to offer. Sands Investment Group has the resources to help aid you in your purchase decision on why you should invest in the car wash industry. 

Reasons To Invest:

With summer just around the corner, the car wash industry will be in high demand.  According to onedesk, 66% of car owners who live in the U.S. will get their vehicle washed anywhere from one to two times every month. Car owners have decreased their use of at-home washes and have rather utilized car washing facilities. 

While there are factors that dictate your income such as location and size, you will be investing in a market that is highly demanded by consumers. Location of your potential car wash is an important factor in determining the pros and cons of a car wash ownership. Different types of car washes will also require different finances such as down payments and space. Investing in the car wash industry is appropriate when it meets your goals, but not if you would be uncomfortable with its upkeep and par value. 

While there are many factors to consider in your purchasing decisions, here at some potential outcomes when a car wash is run correctly:

Increase Your Income

Owning a car wash gives you an increased revenue as there is a high volume of customers. According to Hedges & Company, 2022 is estimated to have 289.5 million registered cars in the United States. 20,000 cars washed in one year can bring you an average revenue of $139,000 alone. On average, car washes charge $15 dollars per car. This would not include additional add-ons that may be available. Investors can make a large profit off of the recurring income that the predictable consumer demand brings to the car wash industry.

Growth 

Owning a car wash will provide a safe and profitable investment. When car wash owners see the increased revenue, many decide to open other locations. They may add on a gas station for sale if space is allocated. According to Brandon Gaille, approximately 65% of car wash stations also dispense gasoline. This would also add new opportunities for growth and increased revenue within your investment. With this eagerness, you can create your own car wash brand on numerous sites. 

Added Real Estate Asset 

Owning a car wash also adds to your real estate portfolio. When owning this car wash real estate you are receiving a passive income but also a premium return. Owning this real estate asset also offers a resale potential. After making your decision to invest in a car wash, you can decide to sell the real estate/business down the road to fund your retirement or bring in more profit. 

How To Invest:

If you are interested in investing in the car wash industry you have two options. You may purchase an existing car wash or start from scratch. However, if you start from scratch, a SIG Car Wash advisor can help you complete the following steps:  

• Prepare a business plan: decide if investing is right for you. 
• Pick a car wash business type: full-service conveyer enterprises, express drive-through sites, and self-service establishments with bays. 
• Pick a location. 
• Check location for zoning and local regulations. 
• Cover financing needs: Paying in cash or using funding to cover the investment purchase, upgrades, and expenses up to at least one year. 

Consult A SIG Car Wash Advisor

Thinking of investing in the car wash industry? The investment opportunities hold limitless growth. Join SIG at The Car Wash Show in Nashville, TN on May: 5/9- 5/11. Become an attendee or make an appointment with a SIG member at the conference! We will be located in booth #556.

If you’re looking to invest in the car wash industry, get in touch with a SIG advisor. Our experts can help you find the right car wash property for your portfolio. SIG is home to experienced brokers that are designated experts in all areas of CRE, including car wash real estate.

Among its listings, Sands Investment Group offers several car washes that are guaranteed by a large company or a dominant regional operator. These car washes are set close to major roads and offer favorable demographics such as nearby retail stores, companies, and universities. They also offer long-term triple-net (NNN) leases of 15-20 years and attractive cap rates that range between 6.25%-7.5%. Contact the team by calling 844.4.SIG.NNN or check out our current car wash listings to get started with your car wash investment.

Commercial real estate investors and owners have faced a series of challenges due to the COVID-19 pandemic and those challenges will evolve. Nobody can predict the future, but we can get an idea of how things in 2022 will progress by looking at current CRE market trends.

While we can’t claim to be on the other side of the pandemic, the country is recovering. That means demographic and business trends will accelerate. When it comes to CRE investments, there will be an increased demand for certain assets as the year progresses. 

Savvy investors will consider CRE market trends when making decisions about where to put their money so they can take advantage of the more popular assets and how to look for opportunities among all asset classes.

CRE Market Trends to Watch

Here are 10 CRE market trends investors should watch for as we move into the Q2 of 2022 and look even further into the future.

1. Continued Market Recovery Post-COVID-19

The first CRE market trend to keep an eye on as 2022 progresses is the continued recovery of economic and CRE markets. That’s not to say everything will be on a constant upward slope. As current events affect prices, you can expect natural ups and downs. As we move further into 2022, we are getting closer to a “new normal” where the market will gain more stability and CRE investment opportunities will keep improving. There may be setbacks and flare-ups along the way, but trends indicate that they will be short-lived.

2. Evolving Retail Models

The way people shop has changed over time, which impacts retail property investment. During the early days of the pandemic, consumers were pushed to spend a lot more online. But now that people are routinely out-and-about again, consumers are returning to retail spaces for in-person shopping. That doesn’t mean online shopping will drop off. Sales have risen in both online and in-store channels, so consumers seem to want more of both types of shopping.

In-store sales are rebounding for retailers because shoppers want to see their buying options in person. Leading to reduced vacancy rates in brick-and-mortar retail spaces, good investment opportunities in the retail property sector will increase and capital for financing will be readily available.

3. Self-Storage as a Popular Asset

Self-storage is a very popular asset to invest in now. A large number of American households rent storage units and demand remains high during all phases of an economic cycle. That means occupancy rates are stable and revenue streams are steady. Investing in self-storage is advantageous because it is somewhat passive and requires less capital. Check out our post on why self-storage investment is a smart move for your portfolio for a more in-depth look at this CRE trend.

4. Continued Growth in the Multifamily Sector 

In 2021, multifamily investment performed very well. Investors can expect that to continue through 2022. According to Crexi, multifamily was the fastest-selling asset type in 2021. The average closing times reached 123 days in Q3 and the market should see increased demand in the next year.

Factors behind this CRE market trend are low supply in single-family homes due to construction limits, price competition along with household formation. The economy is growing, leading to the formation of new households looking for housing. Along with household formation, growth is being driven by people looking for quality multifamily housing with more space to accommodate growing families and working from home.

5. Increased Interest in Senior Housing

Senior living, skilled nursing, and residential health care facilities were heavily impacted by COVID-19. Infections limited move-ins and occupancy of those facilities dropped. However, occupancy rates started increasing at the end of 2021 and will continue to rise as a CRE market trend in 2022. Full recovery may not happen this year, but investors should start considering this asset class again.

6. Changes in Office Space

Due to the pandemic, there is an existential change in the way people view workspaces. Working from home shifted attitudes about working in an office, making some investors wary of office properties. But that doesn’t need to be the case. While working from home seems to be here to stay, it will be part of a flexible hybrid model that also includes in-office work. 

The office will once again be the hub of business activity as people split their time between remote and in-person workplaces. As this setup becomes more common, occupancy in office spaces will be steadier. Demand for flex space, coworking space, and turnkey office space will also create investment opportunities. Forbes predicts that employers will look for larger, cost-effective locations while also demanding spaces with nice amenities and flexibility.

7. More Mixed-Use Space and Adaptive Reuse 

Investments in hospitality, office, and retail spaces will be smart moves as recovery from the pandemic continues, but changes to properties in those sectors may provide opportunities that will add value to portfolios in the future. Mixed-use zoning and adaptive reuse will be CRE trends to keep an eye on going forward. For example, an office becoming a mixed-use space may yield impressive returns in the future as the market continues to change.

8. Investors with Cash In Hand

Many real estate investment firms and private equity investors have cash ready. Many investors are making faster decisions and looking to invest capital before the cost of borrowing increases too much. They will be looking to put money into the hot asset classes like self-storage and multifamily, but they will also look for other places to invest their stockpiled cash, in sectors such as hospitality and retail.

9. Supply-Chain Issues Impacting Industrial Development

Manufacturers, logistics companies, and retailers are all seeking solutions for supply chain issues. These issues have been plaguing businesses for a long time, but it has just recently caught up to the commercial real estate market. 

Transportation and insurance costs are rising and space near seaports is limited and in high demand. For those reasons, things are moving inland for people building new facilities and working on development projects for expansions. There will be an increase in industrial properties in population centers, and in close proximity to highways and airports. 

10. The Proptech Revolution Continues

Technology and software will continue to grow in importance in the commercial real estate world. Property technology (proptech) is vital to many aspects of CRE investments for both brokers and landlords. Software platforms and databases are used for managing deals and portfolios and aid in property management.

Proptech is the key to making things more customer-centered as tenants expect online platforms to streamline operations and improve their user experience.

However, it’s important to keep in mind that technology alone won’t yield success in the commercial real estate industry. An online platform or database will never replace the industry knowledge of an experienced broker. Using property technology to connect people and systems simply makes things more efficient, which drives revenue.

Work with an Experienced Broker

If you’re an investor looking to take advantage of the current CRE market trends and grow your portfolio, get in touch with a SIG advisor. Our experts are uniquely positioned to help you get the most out of your investment. We have brokers that are designated experts in each CRE product type so you can explore the current trends within each specific asset type.

Want to learn more? Call 844.4.SIG.NNN or contact us here to talk about working with our team.

ATLANTA, GA – Sands Investment Group’s (SIG) Atlanta based automotive net-lease broker, Harry Archer and team featured in the WMRE 2022 Market Outlook.
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Some investors need unique ways to finance an investment. Conventional loans, bridge loans, Small Business Administration (SBA loans), and even some other alternatives that many investors aren’t even aware of. Some of these options are a great way for investors to diversify and grow their portfolio while getting rid of properties that may not serve them anymore but keep the businesses that do.  Read more →

When you are looking to buy or sell a commercial property, there are many different steps and considerations you are making. You may be thinking about growing or diversifying your portfolio. You may be thinking of selling a property that no longer fits your goals or generates necessary income. You may have found your dream property to add to your portfolio. No matter what your goals are with the purchase or sale of a property, an appraisal will probably be necessary. Read more →

ORLANDO, FL – Sands Investment Group (SIG), net lease and shopping center investments leader, has recently closed the sale of a Home Depot shadow anchored shopping center in one of America’s fastest-growing metropolitan statistical areas, Orlando, Florida.
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ATLANTA, GA – Sands Investment Group’s (SIG) Atlanta based automotive net-lease broker, Harry Archer, brokered the sale of a $13 million 8-unit Tires Plus portfolio across Atlanta and Athens, GA. Harry Archer and his team at Sands Investment Group represented the seller, a Southeast based private investor, as well as the buyer, a California-based REIT.
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Charleston, SC (August 17, 2021)

Sands Investment Group (SIG) is ecstatic to report today that once again they have made the Inc. Magazine’s list of America’s Fastest-Growing Private Companies. Read more →

A new case study was released today featuring SIG’s EVP of Operations, Ryan Passe, who was invited to speak at the Quickbase Annual Empower Conference earlier this year. SIG’s recent launch of the company’s internal new broker tools including a proprietary compliance and OM tracker app are the focus of the study.

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GlobeSt.com and GlobeSt. Real Estate Forum are pleased to reveal the 2021 selection for Influencers in Net Lease. Originally published on GlobeSt.com.

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As a commercial real estate investor, you may be seeking out the next opportunity right now, or just keeping your options open for future investments. New investment opportunities offer a great chance for you to diversify and grow your portfolio, or simply a chance to trade out a lower performing property for something that will bring you more value in the long run. Whether you currently have a vast array of property types or you’ve focused on one primary type like office buildings, you may be wondering about other ways to increase your investments — and your income. One type of commercial property that can help you grow your portfolio is commercial warehouses for sale.

Commercial warehouses come in all sizes, and they can be used for small, local businesses selling items online or for large, multi-state or multi-national companies with huge ecommerce and sales success. They are found across the country in order to serve their customers, who range from businesses to consumers to even a single company storing items until they are needed. No matter the size of the warehouse, there are a few key benefits investors have found when investing in this type of commercial real estate property. Let’s dive a little deeper into investing into the warehouse property type.

Why Invest in Commercial Warehouses

Investing in commercial warehouse properties for sale often makes sense for people. These leases tend to be much longer term, so you won’t have to constantly seek out a new tenant. With options for a longer lease, commercial warehouses can be a great property for triple net leases, where you can pass off many of the maintenance and tax costs to the tenant. You’ll see a higher return on this property type in most cases, as well. While commercial warehouses may have a higher entry point, most investors make their money back relatively quickly with this high value opportunity zone real estate.

Right now, we are still in the post-pandemic market. During the past 15+ months, ecommerce boomed, which means that there has been a great demand for commercial warehouses for sale across the country. People got used to online shopping and have shifted much of their shopping habits away from brick and mortar stores. This trend of online shopping and businesses needing warehouse space is not going away any time soon. That makes this a great time to invest in commercial warehouses to grow your commercial real estate portfolio.

3 Pros of Commercial Warehouses For Sale

Because commercial warehouses are in high demand, both from businesses and from their customers who are continuing to shop online necessitating more warehouse space for processing orders, these three advantages can be found with this type of commercial real estate:

• Higher return on investment
• Long-term leases
• Lower maintenance needs and costs

3  Cons of Commercial Warehouses

Now, as with anything, there are cons to investment opportunities. So you have the best information going into any investment, you should know these three challenges associated with investing in a commercial warehouse:

• Higher entry costs
• Longer timeframe for finding new tenants
• Technological advancement may outpace the space

Top Tips to Finding the Best Commercial Warehouse Opportunities

When you’re looking for the right commercial warehouse to invest in, there are a few key things to keep in mind. Location is very important to these types of businesses, but often in a different way than other properties you may currently own. Here are four elements of the location to understand when seeking out a commercial warehouse space to invest in.

Location: Distribution centers and warehouses are often located near large population centers. This means there will be better access to more trucks for cross-country delivery. But a large population area doesn’t necessarily mean a big city, which would have more traffic and increased costs. You can find  warehouses properties for sale in every state, and in most cities too. In most cases no matter where the warehouse is located, investors are able to plan for reliable monthly income with few landlord responsibilities, especially when tenants and landlords agree to a NNN lease.

Space: With a commercial warehouse, there needs to be plenty of space for delivery of product. The business relies on receiving products, as well as processing orders and distributing products. This means they will need to have space for trucks to come and go and unload or load materials. Commercial warehouses are often best situated near transportation, like highways or interstates, as well as airports or ports (if located near oceans and large rivers used for transportation). Because the costs of bringing in materials and shipping them out is usually more than half of the expenses these businesses see, location really matters for warehouses.

Storage: Aside from needing space for loading and unloading, commercial warehouses can be used for other things than ecommerce. The changing supply chains now mean more businesses have a need for extra storage or manufacturing space. Some businesses or product types need climate-controlled commercial warehouse space, and across the country the industry has seen a demand for cold storage during vaccine distribution. Storage for products, manufacturing, or other needs as supply chains, businesses, and offices change is continuing to grow.

Height: A unique element to commercial warehouses is the need to understand the importance of height (floor to ceiling space inside the building). The property’s square footage only tells part of its storage capacity, in floor space. But with height, this gives investors and tenants a better idea of the unobstructed space within the building, representing the stacking potential of warehouse contents like crates and boxes.

Work with a Pro to Find the Right Commercial Real Estate for Sale

When you partner with a commercial real estate broker who has your goals in mind, you are better equipped to find the right listings and properties to grow your portfolio. At Sands Investment Group, our brokers across the country work with you to identify your goals, define success on your terms, and find the properties that fit your needs including industrial properties, office spaces and a variety of commercial properties. If you’re ready to discuss adding a commercial warehouse to your portfolio in the post-pandemic market, contact the broker team today by calling 844.4.SIG.NNN or sending an email.

Honoring CRE Female Humanitarians

GlobeSt.com and GlobeSt. Real Estate Forum are pleased to reveal our top picks for 2021 Woman of Influence professionals in the category of humanitarian. Originally published on GlobeSt.com.

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As the NYC subway returns to 24-hour service, indoor dining expands to 75% capacity, and indoor social gatherings expands to a 250 person limit, it’s a welcomed sight to see New York City re-opening! And, we are very much looking forward to attending in person this June 16-17 for NET LEASE Spring 2021.

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Each year, Quickbase customers and partners from around the world get together for 3 days of innovation, inspiration & connection at Empower. Session tracks cover product how-to’s, best practices, case studies, thought leadership and much more. 

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Sands Investment Group is pleased to congratulate Chris Sands on being named one of the commercial real estate industry’s top “Retail Influencers” by GlobeSt.com.

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This article was originally published on Forbes.com

In commercial real estate sales, a common philosophy is the “win-win or no deal” approach. This suggests that both parties in a transaction should aim for a mutually beneficial outcome or walk away from the deal altogether. This brings both parties’ needs into consideration while anticipating an agreement where both the client and the broker feel as though they’ve “won” a positive outcome.

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Opening the doors of Sands Investment Group during the global financial crisis in 2010, Chris Sands has thrived in the face of hard times from the very beginning. He stays committed to investing for success well into the future by focusing on relationships built by win-win deals, collaboration and transparency. In 2020, through its founder’s leadership, SIG doubled in size—gaining recognition as one of Inc 5000’s Fastest Growing Private Companies in America.

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With its sandy beaches, rolling mountains, and bustling cities, North Carolina features natural beauty, culture, and industry such as furniture manufacturing in High Point and hi-tech in Raleigh, Durham and Chapel Hill, the research triangle region.

With a population close to 11 million, North Carolina is the 28^th largest and 9^th most populous U.S. state. Raleigh, the state capital, has a population of about 474,000 people (2.2 million for the entire triangle region), while Charlotte has 870,000 residents. However, recent data collected by the U.S. Census Bureau records that both urban areas rank among fastest-growing U.S. cities.

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