Real-estate OBO: refinancing your premises without losing them
A real-estate OBO means selling your premises to an SCI you control, financed by a loan, to free up cash while keeping the asset. Steps, taxation and precautions against abuse of law.
Expert note: This article was written by our chartered accountancy firm. Information is current as of 2026. For a personalised review of your situation, contact us.
Quick answer. A real-estate OBO, or owner buy out, means selling your premises to an SCI or a holding you control, financed by a bank loan. The owner receives the price, that is cash, while keeping control of the asset through the company. The sale must be at market value and the structure must genuinely operate, or it risks abuse of law.
The real-estate OBO answers a frequent owner question: how do you turn a real-estate asset into cash without selling to a third party or losing control? The technique, derived from the LBO, means selling your own premises to a company financed by credit. Here is the step-by-step guide, and the essential tax precautions.
The principle of the real-estate OBO#
The real-estate OBO is a sale to yourself organised to free up cash.
The owner sells their asset, for example the premises of their business held directly, to an SCI they create and control, often with family. The SCI finances the purchase with a bank loan. The owner receives the sale price, that is immediate cash, while keeping control of the asset through the company whose shares they hold.
It is leverage applied to your own estate: the bank finances the buyback, the rents repay the debt, and the owner has turned a fixed asset into cash without really parting with it.
The steps of the operation#
A real-estate OBO unfolds in a precise sequence that must be respected.
- Have the premises valued at market value by an independent expert.
- Create the SCI or holding that will buy the asset.
- Obtain the bank financing of the acquisition.
- Complete the sale before the notary, with payment of transfer duties.
- Handle the seller's possible capital gain.
- Run the company over time, with a lease and real rents.
Each of these steps has its own stake, and the soundness of the whole depends on respecting all of them. The logic of holding in a company is developed in our comparison SCI or direct ownership of premises.
The taxation of the OBO#
The OBO has a tax cost that must be costed before starting.
On the seller's side, the sale may generate a taxable gain. If it is a private asset, it is the individual real-estate capital gain, with its holding-period allowance, that is full income-tax exemption at 22 years and social-levy exemption at 30 years. On the buyer's side, the SCI bears transfer duties of about 5.80%, to which deed fees are added. If the OBO concerns shares rather than the building, the registration duties on shares of a company with a preponderance of real estate are 5% (Tax Code art. 726 I 2).
The cash freed up is therefore not free: the liquidity gain is measured net of the gain and duties. This is the whole point of the prior calculation.
The abuse-of-law risk#
The OBO is a technique known to the tax authority, which monitors its abuses.
The arrangement must answer a real objective and not be motivated by an exclusively or mainly fiscal aim, or it falls under abuse of law (Tax Procedure Code art. L64 and L64 A). Three precautions are needed: a valuation at market value justified by an expert, real and not fictitious bank financing, and a company that genuinely operates, with a lease, rents actually paid and accounting kept. A botched OBO, at an undervalued price or without substance, exposes to a reassessment.
Our view#
The real-estate OBO is an excellent tool for an owner who wants to free up cash, for example to prepare for retirement or finance a project, without permanently giving up their estate. But it is also an exposed arrangement that does not tolerate approximation.
Our method is to first cost the real tax cost, gain and duties included, then to secure each anti-abuse pillar: independent valuation, real financing, active company. Well built, the OBO combines immediate liquidity, retention of control and preparation of transmission, since the SCI shares can then be gifted or split, as we explain for the transmission of business premises in an SCI.
A common case#
An owner near retirement held his premises directly, debt-free, but lacked cash for his personal projects. The OBO let him sell the premises to a family SCI financed by a loan: he received the price while keeping control through the shares. The independent valuation set an indisputable market value, the bank financing was real, and the SCI operates with a lease and rents. The gain, softened by the holding period, was costed upstream. The operation freed up the desired cash while preparing the transmission of the shares to the children.
Frequently asked questions
What is a real-estate OBO?+
It is a sale to yourself: the owner sells their premises to an SCI or a holding they control, financed by a loan. They receive the price, that is cash, while keeping control of the asset through the company.
What is the point of an OBO?+
To free up cash from a real-estate asset without selling to a third party or losing control. The bank finances the buyback, the rents repay the debt, and the owner turns a fixed asset into cash.
What is the taxation of the OBO?+
The sale may generate a taxable gain on the seller's side, and the acquiring SCI bears transfer duties of about 5.80% on the building, or 5% on shares of a company with a preponderance of real estate. The net cost must be costed before starting.
Does the OBO carry an abuse-of-law risk?+
Yes if the arrangement is motivated by an exclusively or mainly fiscal aim (Tax Procedure Code art. L64 and L64 A). You need a market-value valuation, real financing and a company that genuinely operates to secure the operation.
How do you avoid a reassessment?+
By meeting three conditions: an independent valuation setting the market value, a real bank loan, and an active SCI with a lease, rents actually paid and accounting kept. An undervalued price or an empty shell exposes to a reassessment.
Can you combine OBO and transmission?+
Yes. After the OBO, the SCI shares can be gifted or split for the benefit of the children, which combines the immediate liquidity of the OBO with a strategy of gradual transmission of the estate.
Key takeaways#
- The real-estate OBO is a sale to yourself: you sell your premises to a controlled SCI, financed by a loan, to free up cash.
- Leverage plays: the bank finances the buyback, the rents repay the debt, the owner keeps control.
- On the seller's side, the real-estate capital gain may be due, with exemption at 22 years (income tax) and 30 years (social levies).
- On the buyer's side, transfer duties of about 5.80% on the building, or 5% on shares of a company with a preponderance of real estate.
- Abuse of law looms: market valuation, real financing and an active company are essential (Tax Procedure Code L64).
- The OBO combines with transmission, through later gift or split ownership of the SCI shares.
Article written by the Hayot Expertise firm, registered with the Order of Chartered Accountants of Ile-de-France. Updated for 2026. This article is for information purposes and does not replace an analysis of your own situation.
Article written by Samuel HAYOT
Chartered Accountant, registered with the Institute of Chartered Accountants.
Regulated French accounting and audit firm based in Paris 8, built to support companies across France with a digital and decision-oriented approach.
Sources
Official and operational sources cited for this page.
This topic is part of our service Wealth planning for business owners in France
Need a quote or personalised advice?
Our accountancy firm supports you through all your steps. Get a free quote to review your situation and receive a bespoke fee proposal, or contact us directly.