Case Studies

Integrated Real Estate Solutions, Inc.’s full-service commercial real estate and consulting services have helped numerous companies of various sizes across North America save money and time. Here are some success stories:

I. Major International Bank

Since 2018, Integrated Real Estate Solutions, Inc. has assisted a major international bank (top 10 in assets in North America), that has sold and leased back over 20 US branches to a national operator specializing in such transactions. The large majority of these branches were “oversized”, meaning the bank had too much space for its operations. They wanted to maintain a presence in those markets but wanted to right-size their branch footprint by leasing back only the space they needed for their operations. In these cases, the excess space was leased to other tenants by the new owner. Adding new tenants to the buildings was seen as a complement to the bank by driving more traffic to the location thereby creating touchpoints with potential customers.

The bank evaluated four benefits to the bank that could be accomplished through this transaction:

1) Impacts on Retail Banking Operations:  The goal of the bank is to maintain a banking presence in a market but with less space and at a lower cost;

2) Operations:  The goal of the bank is to reduce the cost of operations due to downsizing and outsourcing real estate ownership and management to a proven commercial real estate operator thereby reducing their non-interest expense;

3) Accounting Benefits:  There are potential accounting benefits to be realized from the sale/leaseback transaction under recently modified FASB accounting regulations including an immediately realized gain on sale; and

4) Impact of Additional Tenants:  Further benefits mount as previously bank-occupied space is leased to other tenants – thus reducing bank responsibility for operating costs – alongside an increase in foot traffic to the individual branch.

The bank has realized significant cost savings in downsizing without any negative impact on deposits.  In fact, deposits in all sold branches have increased since the sale/leaseback transaction.  In addition, the bank has been relieved of the burdens of ownership and operations under a triple-net operating lease structure.  Depending on the net book value of the bank branch, the bank, in some cases, bank also realized a significant capital gain on sale which under newly modified FASB regs, can now be classified as Tier 1 capital – of significant importance to the bank’s balance sheet and profitability (see above).  Finally, due to substantial lease-up (in spite of COVID), there are now other tenants in many locations reducing the bank’s operational real estate expenses, while concurrently creating more foot traffic to the locations.

 If your bank is looking to unlock capital and /or move to the next generation banking model, increasing EBITDA, stock price, and increasing non–dilutive capital contact Jim Schnur President and Designated Broker of Integrated Real Estate Solutions, Inc at 847-550-0160 / .

II. Lease or Buy?

Background: In 2010, a Chicago-area small business was 15 months away from the expiration of its commercial lease. With commercial real estate prices near historic lows, the company was interested in potentially purchasing property to replace its 10,000 square-foot leased location.

Action Steps: Integrated Real Estate Solutions, Inc. conducted an initial lease vs. buy analysis and market survey for the small business, identifying several potential locations and the capital investments necessary to complete the sale. While commercial sale prices were low, Integrated Real Estate Solutions, Inc.’s research showed that rental rates in the market were even lower. Leveraging these insights, Integrated Real Estate Solutions, Inc. negotiated an early lease renewal and extension on the company’s behalf.

Results: Integrated Real Estate Solutions, Inc.’s strategy saved the company $70,000 during the next five years, including $3,000 in annual maintenance costs and $10,000 per year in rent payments.

III. A Valuable Partnership

Background: Since 2007, Integrated Real Estate Solutions, Inc. has collaborated with a prominent national health care provider that is experiencing rapid national expansion. In the past, a company representative spent multiple days researching and scouting potential locations in unfamiliar markets, reducing productivity and hindering the company’s impressive growth.

Action Steps: Integrated Real Estate Solutions, Inc. recommended an ongoing representation relationship with this successful company that includes providing, commercial real estate analysis and strategies for potential markets and locations, and lease terms negotiation.

Results: For each new location, Integrated Real Estate Solutions, Inc.’s strategy saves this leading health care provider significant man-hours per new location, outsourcing all lease negotiations and allowing the company’s business development team to concentrate on its core function: growing a successful enterprise.