In A Down Economy, Ground Leases Are an Underutilized Development SolutionAugust 25, 2020 – Publications / Mentions
In a challenging economic environment, equity can be the most expensive form of capital. As a result, developers and investors often look for alternative ways to control their assets that give high returns. In commercial real estate, ground leases are a great solution that allows owners to maintain that control, while offering flexibility for all parties involved.
A ground lease (also referred to as a land lease) is an agreement between a tenant and an owner for the right to use land for a prolonged period, typically 49 to 99 years. This strategy allows, for instance, a developer to minimize upfront land costs and generate revenue while allowing the landowner the opportunity to maintain ownership of the property while collecting on the lease.
Real estate attorney, Brian Cohen was featured in the article discussing some of the advantages and disadvantages of ground leases for both landlords and tenants.