How do corporate real estate teams decide whether to lease or own a facility?

Corporate real estate teams decide lease versus own by comparing the full cost of each over the expected occupancy period, in present value terms, and then weighing what money cannot capture: flexibility, control of the site, and how much capital the company is willing to tie up in buildings instead of its business. The math is the start, not the answer. The cost comparison - Lease: base rent and escalations, operating expense pass-throughs, tenant improvements above the allowance, moving and exit costs. - Own: purchase price or build cost, financing, taxes, insurance, maintenance and capital repairs, minus the expected resale value at the end. - Discount both at the company's cost of capital and compare. What changes the answer 1. Occupancy period: long, stable needs favor owning; uncertain needs favor leasing. 2. Specialized use: labs, plants and data rooms with heavy custom work are often owned or leased long term. 3. Capital: owning ties up cash or borrowing capacity the business may need. 4. Market: when buying prices are high against rents, leasing tends to win, and the reverse. 5. Exit: how easy it would be to sell or sublet the facility if needs change. A third option Sale-leaseback: a company that owns can sell and lease back to free capital while keeping the site. Inputs to verify Market rents for similar space nearby, recent sales of similar facilities, and property taxes on record. How Titleman helps Titleman pulls rent and sale comps for the location, models lease and own side by side in your template and shows each assumption with its source. Learn more: https://titleman.ai/products/deal-review