Mining the Balance Sheet

Asset-based loans are an increasingly attractive alternative to bank financing, and not just for those who can't borrow against cash flow.

But companies have also turned to sale-leasebacks as an alternative to the equity and debt markets, which have been unreliable sources of financing in the past year at the same time as real estate has maintained high values. What’s more, Bryan says, companies have been attracted by new debt-financing structures that have helped lower the cost of doing sale-leasebacks.

In December, for instance, Staubach helped the oil-exploration company Phillips Petroleum Co. sell its Anchorage headquarters building for $104 million and lease it back for 20 years. With that transaction, plus others, the company could by year’s end pay down debt taken on last summer to acquire Arco’s 50 percent interest in Alaska’s giant North Slope oil field. —H.R.

From Assets to Liabilities

Amount of asset-based loans outstanding (in $ millions)

Year  Total
1999 $293,773
1998 $254,217
1997  $205,129
1996  $169,490
1995 $141,049
1994  $117,049
1993 $102,084
1992 $90,532
1991 $83,769
1990 $95,786
1989 $100,678
1988 $94,254
1987 $83,689
1986 $68,691
1985 $57,740
1984 $41,808
1983 $30,651
1982 $30,528
1981 $27,836
1980 $25,063
1979 $22,332
1978 $13,870

Source: The Commercial Finance Association

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