Quadrent provides leasing solutions for large corporate and government clients to help them cost-effectively finance their assets that have a limited useful life, providing an alternative to the traditional bank lending model.
Our business model and our ability to invest in the assets we lease, ensures we can provide you with a cost-effective solution to procuring the assets you need. We have breadth across funding lines and we’re supplier and asset independent. Examples of items we regularly fund include mobile phones, tablets, laptops, scanners, servers, AV solutions, commercial refrigeration, complex infrastructure, furniture, testing equipment, medical equipment, software, and French Oak wine barrels. More specifically, the only assets we do not invest in are vehicles and real property.
In a rapidly changing world, it makes even greater sense to own items that appreciate in value and lease items that depreciate. We provide three lease and rental structures according to what suits your business needs the best (operating lease, finance lease and sale and leaseback), as well as structured finance options.
Under an operating lease, Quadrent makes an upfront investment in the asset’s market value at the end of the lease term, therefore keeping ownership and title of the assets during and after the lease. This solution is best suited for assets that are frequently upgraded or replaced, such as technology. The typical term of an operating lease is between one to five years.
The recurring lease payment amounts take into account the total cost minus our investment, which means your total lease cost is less than the purchase price of the asset.
An operating lease is a cost-effective solution especially useful in situations where a business needs to replace or upgrade its assets on a recurring basis, and so has a need to seamlessly swap out old assets for new ones at regular intervals.
An operating lease allows you to achieve a number of objectives including:
greater control of your cash flow. eliminating end of term ownership responsibilities. reducing operating and ownership costs. continuously keeping technology updated. better management of your business’s capital and debt. the flexibility to add or upgrade equipment during the lease period.
At the end of the lease term, you can:
We will proactively work with you to tailor the best end of term solution for your business, ensuring there are no surprises.
Under a finance lease, Quadrent transfers ownership of the asset to you at the end of the term. We do not place a residual investment in the asset, so the lease is similar to a bank loan and is treated as a depreciating asset. This is best suited for assets with a long lifecycle, or when ownership at the end of the lease term is desirable.
Finance lease payments are typically higher than an operating lease because we do not invest in the asset’s market value at the end of the lease term.
A finance lease is useful in situations where a business is looking to lease a specialised asset.
The lease may be considered a finance lease if it meets the following criteria:
at the end of the lease period, ownership of the asset is shifted to the lessee, or there is an option to purchase the leased asset. the period of the lease covers the majority of the assets remaining economic life. the fair value of the asset or the lessee-guaranteed residual value matches or exceeds the sum of all lease payments. the asset is considered to be specialised and there is no alternate use following the lease period.
A finance lease allows you to achieve a number of objectives including:
In conversion to leasing, ‘sale and leaseback’, the business sells an asset to Quadrent for fair market value and, in turn, takes on a lease for the asset. Your business becomes the lessee and Quadrent becomes the lessor.
Before IFRS 16, conversion to leasing was often used in commercial sectors to free up capital which could be used to invest in business activities, pay off debts or buy core assets, while still having use of the asset.
Since the introduction of IFRS 16, you must satisfy the accounting rules for the sale of the asset before it goes onto your business’s balance sheet. This makes reporting obligations for this type of arrangement more onerous, but it’s still possible to manage this complexity. For example, Quadrent uses conversion to leasing contracts where assets are purchased but still treated as a lease (rather than a sale and leaseback) to achieve a similar result.
A sale and leaseback structure allows companies to achieve a number of objectives including:
Again, we will proactively work with you to decide the best end of term solution for your business, ensuring there are no surprises.
Quadrent is an expert in developing structured finance models to support different clients, vendors and supplier requirements. This can include managed services, structured payment plans and project finance. Quadrent understands how to align the funding requirement to the desired customer outcome, securing and often significantly enhancing the value created by the project or service. This removes the tension between cost and revenue and in many cases expands the number and range of viable projects.
We can also fund a combination of hardware, software and services, as well as provide bill, collect and remit services to make the payment process of multiple line items simple.