Simultaneous Sale Leaseback to Fund Acquisition of Gas Station C-Store

Background:

The Ascension Team represents a founder-owned gas station and convenience store operator in South Florida. The Team has previously generated $69+ million in sale leaseback financing for this company, which has allowed the business to grow to 14 locations throughout the state of Florida within an 18-month period. The Company was underwriting an acquisition opportunity of a Mobil Gas Station and Convenience Store in Spring Hill, Florida and saw an ideal opportunity to utilize a sale leaseback to fund the transaction. The Spring Hill location was a strategic site for the operator as it provided the Company with a launch point into the Tampa metro area.

Client Objective:

The client was interested in acquiring the operations of the Mobil gas station and convenience store given the site’s strategic location on the hard corner of two major roads. The owner was running a very competitive sale process for the location, and Ascension’s client was set on acquiring the site. The Ascension team was confident that a simultaneous sale leaseback of the real estate would help the operator generate a significant arbitrage, which would allow the operator to compete more effectively for the acquisition of the business operations.

Solution:

Given the strong site-level performance and the credit of the operator, the Ascension team was confident they could generate strong interest in a long-term sale leaseback of the real estate. After running a competitive marketing process and vetting several interested buyers across the private and institutional sectors, the team landed at an attractive sale leaseback offer which successfully closed at a purchase price of $6.8 million, and within the client's desired timeframe. This transaction generated $1.4 million in net profit for the operator, who was able to acquire the operations without tying up any equity into the transaction. The buyer was a private investment firm.