earticle

영어

This study aims to investigate the effect of Sale and Leaseback(SLB) agreements on price differentials between SLB and non-SLB transactions. Under SLB agreements, corporations simultaneously sign the lease agreements for properties being sold.. Previous studies found that Firms agree to SLB for various reasons, such as taxation, accounting, and finance; finance was the largest driving force of all. Studies have also depicted a positive correlation of the SLB announcements to the stock market, such news producing positive returns to the shareholders. Not much studies, however, have been conducted on the impact of SLB on transaction prices. Using a set of data on SLB transactions, this study examines the price impact on commercial property transactions in Seoul's office market. Out of 656 transactions overall, we have selected 551 for sufficient analysis. Among them, 74 cases were SLB transactions, representing 13.4% of the sample. Multi-variate regression results reveal that transactions structured as SLB occured at lower prices than non-SLB transactions when all other conditions were equal. Specifically, the correlation coefficient of SLB dummy variable was -0.13, indicating that SLB transactions occurred at a discounted price of 12.2%. Further studies are required to better understand the determinants of price differentials in SLB transactions.