To Lease or Buy: That is the Question

To Lease or Buy: That is the Question


May 2001

Many small retail and restaurant chains have limited capital resources with which to grow their store base. This constraint has caused many chains to look at leasing their facilities to reduce their total capital outlay during any fiscal year. Leasing allows them to stretch their dollars allowing them to open a greater number of stores than would be possible if they had to purchase the land and build their own facility. However, there are many pitfalls to being a tenant versus an owner. The decision is not a simple one.

Keywords: retail, lease, sale/leaseback, asset, flexibility, cost

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