Working Capital Release

Working Capital Release: In real estate and other industries, working capital release (also known as the release of working capital) refers to the process of freeing up or realizing cash from the working capital of a business or property.

Working capital is the difference between a company's current assets and its current liabilities. It represents the short-term liquidity of a company and is a measure of its operational efficiency and short-term financial health.

In the context of real estate, working capital is typically used to manage the day-to-day operations of a property, such as maintenance, tenant services, and other operational expenses.

Working capital release can happen through improving the efficiency of operations, reducing costs, or increasing revenues. It can also occur when a property is sold, and the capital tied up in the property's operations is released.

In a financial model, a working capital release might be modeled at the exit of an investment, where any remaining working capital (cash needed for daily operations) is assumed to be released back to the investor or used to pay off remaining expenses.