Bridge Loan Bridging Finance Sale Leaseback |7 Park Avenue Financial

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A Sale Leaseback Is A Solid Way Accessing Bridging Finance Needs:  The Asset Bridge Loan Made Easy
A Different Way Of Looking At Short Term Loans Via Bridge Finance



 

YOUR COMPANY IS LOOKING FOR   SHORT TERM FINANCING SOLUTIONS!

LEASEBACK BRIDGE LOANS IN CANADA

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Financing & Cash flow are the biggest issues facing business today.

ARE YOU UNAWARE OR   DISSATISFIED WITH YOUR CURRENT  BUSINESS  FINANCING OPTIONS?

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EMAIL - sprokop@7parkavenuefinancial.com

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

bridge finance

 

Bridging finance, in some manner, is often sought by Canadian business owners and financial managers. The sale-leaseback, via a traditional lease, or a ' bridge loan' (there’s a difference), is one way to achieve that financing need. Let's dig in.

 

THE LEASEBACK SOLUTION ON ASSETS YOU ALREADY OWN 

 

Your company has the ability to make maximum use of your firm's owned assets in a manner you may not have considered. It's the 'sale-leaseback,’

 

WHAT IS THE APPEAL OF A SALE LEASEBACK TO BUSINESS OWNERS

 

By selling back the asset or assets to a third party, you can address several key challenges you might be facing on the balance sheet, not the least of which is cash flow.

 

So how is this type of transaction completed... successfully? Several factors come into play. When you have assets such as equipment, technology, and even real estate used in your core business, are still needed and are owned outright a significant opportunity exists to ' cash flow' the asset/assets. 

 

THE ALTERNATIVE TO NEW EQUITY IN THE BUSINESS 

 

Naturally, the need for capital can be satisfied in several ways. Still, most owners are reluctant to address the issue of new equity investment - it dilutes ownership and sometimes isn’t possible.

 

Let's recap some of those key benefits of a bridge loan/ leaseback on owned assets. They include:

 

WHAT ARE 2 COMMON USES OF LEASEBACK FINANCE

 

The ability to free up equity that’s held on your balance sheet - this could actually be distributed to the owners  or used as a  working capital component to continue the growth of the company

 

If your business is doing well and hampered by growth capital the ability of your company to earn higher profits  than offset the costs of the bridging finance is a desirable route

 
DEBT REDUCTION  

 

In many cases it allows the company to redo their balance sheet in some manner, i.e. pay down other more expensive debt, eliminate some debt, etc

 

REAL ESTATE CAN BE A KEY PART OF A LEASEBACK SOLUTION 

 

Using company-owned real estate as an example you can ensure your company uses capital to operate and grow the business, as your charter is clearly no real estate ownership.  Note: Many large corporations, even our chartered banks included have sold their real estate holdings and leased them back - even the big guys recognize they are running a business, not investing in real estate. Apologies of course to those ' PRIDE OF OWNERSHIP' folks!

 

THE COST OF FINANCING

 

In certain cases, the interest rate environment alone might be a major consideration. The current low rate environment might make sense to acquire capital at 4% and reduce debt acquired at 9% as an example.

 

DON'T FORGET TO CHECK OUT LEASE BACK ACCOUNTING ISSUES

 

Finally, in some cases, your advisors such as accountants and the tax folks might be able to point out some solid advantages to a sale-leaseback.

 

bridging financing

 

CONCLUSION

 

If you’re looking for a different way to raise capital/cash the sale-leaseback is a great way to address bridge finance needs. That might be either a traditional lease or a short term bridge loan. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can turn those needs into ' easy'.

 

Click here for the business finance track record of 7 Park Avenue Financial

 




7 Park Avenue Financial/Copyright/2021/Rights Reserved

' Canadian Business Financing With The Intelligent Use Of Experience '

 STAN PROKOP
7 Park Avenue Financial/Copyright/2022

 

 

 

 

 

Stan Prokop is the founder of 7 Park Avenue Financial and a recognized expert on Canadian Business Financing. Since 2004 Stan has helped hundreds of small, medium and large organizations achieve the financing they need to survive and grow. He has decades of credit and lending experience working for firms such as Hewlett Packard / Cable & Wireless / Ashland Oil