StartInside ICHHermes messagesWhat is the "sale & leaseback" ?, Is it only for the big ones ?.

What is the "sale & leaseback" ?, Is it only for the big ones ?.

SLB, from its acronym in English "sale & leaseback", means "sell to rent". To be more precise, it would be "sale conditional on rent."

These operations have had a strong presence in the real estate market for a long time. It is very simple, I sell an asset with a rental contract and, thus, everyone wins: the tenant is not affected; the one who sells achieves the liquidity objective and the one who invests in the rented asset, has income from the first moment.

The equation is perfect if whoever sells is the same as who rents. It is a way of managing your own assets depending on the need for the cash flow of your business. That is, I can invest and divest according to my cash needs: In good times I can create equity and in stormy times I can create cash.

An example of this is Mercadona. In July it announced the sale of 38 stores in its supermarkets for a value of 200 million euros. As it sounds, Mercadona sells 108.000 m2, but the supermarket remains, and begins to pay rent to the buyer. Who would not invest in such an operation? Unfortunately you cannot, only a few can access this type of annual profitability operations, when who pays the rent is Mercadona.

However, we don't want to play in the Mercadona league either. You don't need to know about football to know that, in addition to the Champions League, there is the Europe League, the League, the Second Division ... And they are all football, with the same rules, each league with its opponents. Icrowdhouse proposes to play SLB in other leagues, not in the Champions League. We see needs and offer solutions. We are building this solution thanks to our financing platform with authorization from the CNMV.

Let's look at another example. Not the one from Mercadona, a closer one. I have a leading restaurant in Castelldefels for 10 years, 4.8 on Tripadvisor, why do I have to close it and fire my staff, if I own the premises. But I cannot, nor do I want to, request a mortgage because it would be risking the only thing I have left, the asset? 

Icrowdhouse offers you something disruptive. Thanks to our solution you can offer 30% of your assets to investors who will be partners (equity) of your premises, but not of the operation of the restaurant. 

He has continued to manage the restaurant as usual for 10 years, having € 100.000 cash to overcome this situation at no financial cost, with a rental cost for 5 years (for example), and with a repurchase agreement for the entity's stake legal of the premises to your Partners. This way you can have a sufficient period to capitalize and be able to have 100% of the premises again in 5 years, because you have always been from the restaurant and always will be.

We are in a pandemic situation. Businesses that were profitable many years ago have been in a critical situation. Despite the fact that this crisis is temporary, it may mean the closure of many businesses so far viable due to lack of cash. But this is not 2008: there is liquidity in investment funds, yes, but also in thousands of savers that amount to billions of euros. 

The excess of leverage taught us that we do not survive with the tap turned off. We do not want to depend on a single tap, we want to have several, store water and manage it, especially at a time when financial investment markets are not going through their best moment. 

what is the sale leaseback is only for the big icrowdhouse

We return to football after talking about financing. We have a need for cash, but we have liquidity and investors. Shall we start the game? We lack a small detail: we do not have a soccer field! That's what icrowdhouse takes care of. We don't need either the Bernabéu or the Camp Nou, we have plenty of a modest one, because we like to offer efficient solutions tailored to needs.

We want to create a network of originators capable of reaching the market and offering this SLB solution on a smaller scale to whoever needs it at the moment, because we know that investors are willing to have a quality return on capital that is generating little.

How many investors are willing to offer their capital to obtain 6% per year? They can be investors from Castelldefels, Madrid, or Buenos Aires, thousands of icrowdhouse investors see the 100% transparent opportunity. So, how long do we need to raise € 100.000? The answer is days, you only need the digital channel that communicates them, that is icrowdhouse.

We have thought about offering our solution to members of a type of activity that has a lot of capillarity, that is super atomized, is very local (they know everyone from their locality) and they also want to be able to survive this storm that is hitting us. 

They are the real estate companies, they are the APIs, they are our best ambassadors and together we can create this solution network and together we can build a better world. 

Everybody wins.


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