In commercial real estate the right buyer isn’t always the one actively searching for a property. Sometimes they’re already occupying the space—they just don’t know they can be a buyer.
That’s exactly what happened in a recent deal I worked on at the Thomas Duke Company. Instead of taking a lower offer or waiting indefinitely for an investor to come along, we got creative. We structured a creative financing agreement that benefited both the seller and the tenant, resulting in a full-price sale of $1.9 million.
This transaction proved that with the right strategy we can unlock value beyond a standard sale. Here’s how we made it happen.
The seller came to us with one goal: sell the property for the best possible price. At that time, however, the market wasn’t putting forward the right kind of buyer.
The seller had already secured a tenant who was leasing the space for $20,000 per month. But even with that steady income stream, most investors looking at the property weren’t willing to pay the asking price. The best offers coming in were around $1.5 million—significantly lower than what the seller was hoping for.
This put the owner in a tough position. Do they settle for a lower offer? Do they hold onto the property indefinitely, waiting for the market to shift? Or do they get creative?
In that tough position, we saw an opportunity.
Our solution was simple but effective: rather than looking for an outside buyer, we turned the existing tenant into the buyer.
We structured a creative financing agreement that worked for both parties. Here’s how it was set up:
✅ $12,000 of the monthly lease payment went directly to the landlord as normal rent.
✅ $8,000 was placed in escrow with First American Title Company, building up the tenant’s down payment for the eventual purchase.
This arrangement had a three-year lease term with no option to renew. At the end of the three years the tenant had a choice:
1. Move forward with purchasing the property, using the funds in escrow as their down payment.
2. Walk away and forfeit all escrowed funds, which would then be released to the seller.
This structure gave the tenant a clear incentive: if they didn’t buy the property, they would lose a significant amount of money. That meant they were highly motivated to ensure their business was successful and that they were in a position to secure financing by the time the lease ended.
For the seller this approach eliminated uncertainty. Instead of accepting a low-ball offer of $1.5 million, they were able to lock in a buyer at full price while still collecting rental income.
This deal worked because it aligned incentives for both the tenant and the landlord.
✔ For the Tenant: Instead of scrambling to secure financing upfront, they had time to prove their business’s success and gradually build equity in the property. The monthly escrow payments gave them skin in the game, ensuring they were financially prepared to close.
✔ For the Seller: Instead of accepting a lower offer or sitting on the property for years, they collected steady rental income while securing a future sale at full price.
From the start we knew that for this deal to work trust and transparency were key. We made sure the tenant understood exactly what they were committing to, and we worked with them throughout the process to make sure the financing arrangements were on track.
Three years later, almost to the day, we closed the deal at $1.9 million—100% of our asking price.
The seller got exactly what they wanted, and the tenant successfully transitioned into ownership—something they may have never considered possible if not for this structure.
This deal could have played out very differently:
🔸 Without this approach the seller may have had to accept a lower offer at $1.5 million.
🔸 The tenant may have never pursued ownership if not for the lease-to-own structure.
🔸 The property may have languished on the market indefinitely, waiting for the “right” investor to come along.
Instead we created a win-win solution by thinking outside the box.
This deal is a perfect example of how a creative approach can unlock hidden value in real estate transactions.
A traditional sale isn’t always the best or only option. Whether you’re looking to sell now or you’re exploring possibilities, structuring a deal that works for you is key.
At Thomas Duke Company we specialize in thinking beyond the standard approach. We work with property owners to identify strategies that fit their goals, market conditions, and unique property situations—just like we did here.
If you own a commercial property and are exploring your options—whether it’s leasing, selling, or structuring a deal tailored to your needs—I’d love to help.
Let’s talk about how we can maximize the value of your property and create the right opportunity for you.
📧 Email: eszerlag@thomasduke.com
📞 Call: (248) 476-3494
