asked 2011-12-29 11:18:52 -0500
I have noticed that a number of large corporations that lease their buildings instead of owning them. It seems like they would want to own if they have the cash. Is there a good reason for this?
answered 2011-12-29 11:58:36 -0500
The tax implications can be another reason for leasing vs. owning. This may change for some businesses because of new FASB accounting standards. Currently businesses have a lower liability on their balance sheets by leasing. The new standards will not allow you to classify leases as capital or operating and lessees will be required to capitalize all leases.
answered 2011-12-29 11:53:11 -0500
In corporate real estate the business may choose to lease a property if they can get a better return on their capital with their core business. For instance, if Walgreens can get a 30% return on their capital with in store sales, it would not make sense for them to use those dollars to own their real estate and get a lower return.
 | Register for Email Alerts |
 | |
 | Follow @askCRE |
 | RSS Feed |
Asked: 2011-12-29 11:18:52 -0500
Seen: 82 times
Last updated: Dec 29 '11
