Case Study: Royal Food Service Sale Leaseback of Cold Storage Facility

Ascension Advisory advised Royal Food Service on the structuring and execution of a sale leaseback of its 22,000-square-foot cold storage facility in Ringgold, Georgia.

The transaction was completed simultaneously with the company’s acquisition of the property, enabling Royal Food Service to unlock real estate capital while retaining full operational control of the mission-critical facility.

Proceeds from the sale leaseback were used to support the acquisition financing, while the buyer also agreed to fund a planned facility expansion, creating additional long-term value for both parties.

Objective:

Ascension Advisory identified an opportunity for Royal Food Service to unlock capital tied up in real estate while preserving operational continuity of a critical distribution facility.

The asset’s importance to Royal Food Service’s logistics operations, combined with strong tenant credit, long-term lease structure, and the potential for future expansion, generated significant investor interest. Cold storage and food logistics assets continue to attract strong investor demand due to their essential role in the food supply chain.

Solution:

Ascension Advisory structured and managed a competitive investor process, highlighting:

• The mission-critical nature of the facility
• Royal Food Service’s operational stability and corporate guarantee
• The long-term lease structure with rent escalations
• The future expansion component funded by the buyer

The transaction required coordinated execution of a simultaneous sign-and-close, alongside negotiation of the expansion financing agreement, adding complexity to the closing process.

Through careful coordination with all parties, Ascension Advisory successfully delivered the transaction on schedule and with competitive market economics.

Outcome:

Through the sale leaseback, Royal Food Service was able to:

• Generate capital to support a simultaneous acquisition transaction
• Retain operational control of a mission-critical distribution facility
• Secure future expansion funding from the buyer
• Maintain long-term occupancy under a stable NNN lease structure

This transaction highlights the value of strategically structured sale leasebacks as a capital solution for growth-oriented companies.