Sale-and-Leaseback in GCC Real Estate: Unlocking Trapped Capital Without Losing Operational Control

Businesses across the Gulf Cooperation Council (GCC) hold substantial capital trapped in the real estate they own and occupy, from corporate headquarters and industrial facilities to retail showrooms and developer-held units. That capital earns only the implicit return of avoided rent, typically far below the return the business could earn by redeploying it into its core operations or new investment. Sale-and-leaseback (SLB), the simultaneous sale of an owned property and its lease-back to the seller, releases this trapped capital while allowing the business to continue occupying and operating the asset. This paper examines SLB as a corporate finance tool for GCC developers, owner-occupiers and family businesses, and develops a framework for deciding when, and in what structure, it creates value. Using an indicative dataset calibrated to 2026 GCC conditions, the study sets out the principal SLB structures, develops the central arbitrage between the capitalisation rate at which the asset is sold and the return on the redeployed capital, examines the lease structuring that determines how much control the seller retains, and analyses the accounting, tax and balance-sheet effects, including the implications of the recently introduced corporate tax and of lease accounting standards. The analysis finds that SLB creates value whenever the return on redeployed capital exceeds the capitalisation rate paid to the investor, that the seller can retain substantial operational control through careful lease structuring and repurchase options, and that the introduction of corporate tax in the region has strengthened the case for SLB by making rent a deductible expense. A net present-value comparison, a sensitivity analysis and three indicative case studies support the framework, alongside an international comparison and an implementation roadmap for practitioners.