Why do companies that own a building sell the building and lease a space in it? Ex: CBS with television city
In: 9
CapEx (capital expenditures: buying stuff) and OpEx (operational expenditures: keeping the lights on). Selling the building is a negative CapEx (i.e brings money in instead of spending), in exchange for future OpEx. Companies tend to do that when their CapEx starts looking scary, since it’s a great one-time windfall, but of course they are mortgaging a bit of their future.
Latest Answers