After evaluating options for a technology company whose stock values had significantly decreased recently, CSFB says it became clear that the company's real estate portfolio, which was on the books for a reported $200 million but valued at $800 million on the market, could save the company.
In cases like this, and many others in Silicon Valley, CSFB says it is becoming a trend to sell real estate properties and lease them back to maintain liquidity and pay off other debts. By doing this, says CSFB, the companies can gain the market value for the property, which increases their stock value, and enables the company to meet their financial goals.
Companies such as CSFB recommend that, while it may not be the best option for all companies, removing real estate assets from balance sheets and securing synthetic leases, may be an excellent way to improve a company's financial situation.
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