Global supply chains are under growing pressure, and the reintroduction of tariffs in 2025, such as 10% duties on imports from a wide range of countries, is adding significant cost burdens. For businesses reliant on cross-border trade, these tariffs threaten margins and operational stability. However, owner-users and private equity firms with valuable real estate assets have a strategic tool at their disposal: sale leasebacks. By unlocking capital tied up in owned properties, companies can fund supply chain initiatives like nearshoring and diversified sourcing, while still maintaining control of their facilities.
Navigating Tariff-Driven Challenges
Tariffs disrupt more than just budgets, they force a fundamental reevaluation of sourcing and logistics strategies. For manufacturers, retailers, and logistics firms, rising import costs, potentially increasing operational expenses by up to 4% in some sectors, demand swift action. Private equity groups face similar pressures as portfolio companies grapple with margin compression and supply chain bottlenecks. Sale leasebacks offer a strategic solution, turning fixed real estate assets into liquid capital to fund adaptation, without the burden of costly debt in today’s high-interest-rate environment.
Unlocking Capital for Supply Chain Solutions
A sale leaseback is straightforward: a company sells its property to an investor and leases it back, gaining immediate cash while retaining operational use. This capital can reshape supply chains. A manufacturer might redirect funds to domestic suppliers, reducing reliance on tariff-impacted imports. A logistics firm could invest in regional distribution hubs to optimize delivery networks. These steps mitigate cost pressures and enhance agility, a vital edge in a volatile trade landscape.
Real-World Impact
Imagine a food processing company with a key production facility. Facing tariff-driven cost hikes on imported ingredients, it executes a sale leaseback, raising $20 million. The proceeds fund a domestic warehouse and local supplier partnerships, cutting import dependency and stabilizing costs. Similarly, a private equity firm might use sale leaseback capital to help a portfolio retailer reconfigure its supply chain for nearshoring, boosting efficiency and enhancing exit value. These examples show how sale leasebacks align financial and operational strategies.
Beyond Cost Savings
The benefits extend past cost mitigation. Stronger supply chains improve customer satisfaction through faster delivery and reliable inventory, critical as e-commerce competition grows. For private equity, these improvements increase portfolio value, creating compelling narratives for investors. Sale leasebacks also offer tax advantages, like deductible lease payments, and allow businesses to stay in tailored facilities without ownership burdens. A 2024 CBRE report noted 68% of real estate executives prioritize liquidity, highlighting the appeal of this approach.
A Strategic Opportunity
As tariffs reshape global trade, businesses with owned real estate hold a unique advantage. Sale leasebacks provide the capital to build resilient supply chains, positioning companies to thrive amid uncertainty. Owner-users can safeguard operations and competitiveness, while private equity firms can unlock value in portfolio companies, balancing short-term stability with long-term growth. In a world where adaptability is paramount, this strategy offers a powerful way to turn real estate into a catalyst for enduring success.
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