[dmuneka]

Whilst what you say is true, it should, however, be noted that this is done mostly for liquidity considerations rather than beefing up any accounting ratios. Obviously it’s impossible to tell without seeing the actual legal documents, but the upcoming guidance on lease accounting will most likely require that this type of sale and leaseback transaction to be shown on the balance sheet. So any benefit of turning this into an off-balance sheet lease would only be for the next few years.

[mathattack]

True - if not on the balance sheet, definitely in the footnotes.

I think there is something to be said for extracting the value of the illiquid asset. Retailers like Sears and Target were valued primarily based on their real estate until real estate went South and all that was lost.