What are your thoughts on a sale-leaseback for brick and mortar retail stores that are part of roll-up strategy versus acquiring the real estate with the business?

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That sounds like the opposite of what they did to red lobster no?

Aren’t you supposed to buy the brand and the land and then split to op co and prop co, stick the debt onto op co, overcharge rent draining op co of remaining cash until it goes into bankruptcy and then sell the land out from underneath?

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You shouldn’t own the land in the same company. You can sell usually it for a higher multiple than the company’s EBITDA multiple.

If you have a ton of locations the Opco Propco structure makes sense. Because you can create a RE portfolio of 20 or 200 or whatever locations which further compresses cap rates, versus one manufacturing site (when a straight up sale leaseback makes more sense).

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