Ascension Advisory successfully executed a $17 million sale leaseback of a five-property industrial portfolio totaling approximately 147,000 square feet across Alabama, Mississippi, and Tennessee. The portfolio consisted of mission-critical chemical storage, blending, packaging, and distribution facilities supporting an established specialty chemical distributor with more than 50 years of operating history.
Transaction Approach
The sale leaseback was executed simultaneously with an M&A transaction in which the client, a private equity-backed chemical distribution platform, acquired the operating company as a strategic add-on.
Ascension worked alongside the acquisition process to monetize the target company's owned real estate, incorporating the $17 million in sale leaseback proceeds directly into the acquisition capital stack. This structure provided an additional source of acquisition financing, reducing the capital required from traditional debt and equity sources while allowing the acquired business to maintain uninterrupted operations across its facilities.
To support the transaction, Ascension structured a 20-year absolute triple-net lease with annual rent increases and a corporate guaranty from the acquiring platform, creating an attractive investment opportunity for institutional real estate capital.
Outcome
The $17 million sale leaseback closed in conjunction with the M&A transaction, providing a meaningful source of acquisition financing and enabling the client to efficiently deploy capital toward its strategic expansion.
The transaction highlights Ascension's ability to work alongside private equity sponsors and their platform companies to identify and execute creative real estate financing solutions that support strategic acquisitions, reduce upfront equity requirements, and optimize capital structures while preserving operational control of mission-critical facilities.
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