New York City Tri-State Area: Cash is King

  Cash is increasingly becoming king. This is evidenced on several fronts: Major corporations are increasingly evaluating the sale and leaseback of corporate facilities to generate cash. Longer leases (15 years or more) and parent guarantees are becoming the norm. Lenders on commercial properties are requiring far more equity than in the

 

Cash is increasingly becoming king. This is evidenced on several fronts:

  1. Major corporations are increasingly evaluating the sale and leaseback of corporate facilities to generate cash. Longer leases (15 years or more) and parent guarantees are becoming the norm.
  2. Lenders on commercial properties are requiring far more equity than in the past. Life companies are requiring 40% – 50% in equity and only lend on the highest quality real estate.
  3. Funds that can write the check for the entire acquisition price without the need for financing are the preferred buyer among sellers. The assuredness of closing typically wins out over higher offers with financing contingencies.