Owners, developers, investors and their counsel hire us when a ground lease is on the table and nobody in the room writes them every day. We size it, test it against what leasehold lenders will actually finance, and mark up the handful of terms that decide whether the building can ever be financed or sold. What it costs depends on what you need, and we agree it in writing before we start.
| You are | The situation | The question we answer |
|---|---|---|
| A landowner: a family, a church, a school, a public agency | A developer has offered to lease your land instead of buying it | Is the rent fair, will the building get financed, and what comes back to you at the end |
| A developer | The landowner will only lease, and has handed you their form | Will a construction lender accept this, and what has to change so one will |
| An owner on an old lease | The term is running down and lenders have started saying no | What an extension or a new lease should say, and how to bring it to the landowner |
| An investor | You want to own ground leases and are setting your own standards | What box, what coverage, what lease terms, and how to read a deal you are shown |
| An affordable housing developer | The land cost is the gap in a tax credit deal | Where a ground lease fits in the stack and what the investor and the agency will require |
| A lender or counsel | A leasehold loan or a lease negotiation needs a second read | Whether this lease is financeable as written |
Related reading: what leasehold lenders require, CPI vs FMV reset, and ground leases in tax credit deals.
Sizing. The rent the property can carry, the land value that rent supports, and the coverage a lender will see. Built from your own numbers, the same way we size the deals we originate.
Lease review. A short memo that tests the draft against the public agency standard for financeable ground leases: term, subordination, escalations, resets, lender protections, casualty, transfer and what returns at expiry.
The markup list. The specific changes to ask for, in order of importance, with the reason for each in words the other side’s counsel will accept.
Lender readiness. What a leasehold lender will ask, answered before they ask it, so the financing does not stall on the ground lease.
We work alongside your attorney. We are not a law firm and we do not list property. What we bring is the underwriting and the pattern knowledge from making these transactions every week.
A second read of one lease is a small piece of work. Structuring a transaction and finding the other side of it is a large one. We agree the scope and the fee in writing before we start: usually a retainer for the work, and a fee at closing when we create the transaction.
Often the real answer to the question is a transaction: the land should be sold to an investor who wants to own it, or the old lease should be replaced with a new one. When that is the answer, we are the ones who make it happen. We bring the land investor, write the lease and arrange the debt.
An owner or developer who wants to sell the land and keep the building can skip this page. Send the deal and we size it as a buyer: how we buy the land. An investor who wants to own ground leases can ask us to originate them: ground leases made to order.
The land, on a 99-year lease: nothing to manage, senior to the building’s lender, low yield because the buyer is buying the right to not pay the tax. The building above it: higher yield, paid monthly, depreciable. Both are replacement property. Both close on a date we control, which is the part that matters on day 140.
1031 SolutionsWorking with an intermediary? The standby sheet for line 3 of the identification form.
Sizes the rent and land value a property supports, reviews the draft lease against what leasehold lenders will finance, lists the changes to ask for, and prepares the answers a lender will need. The work sits alongside your attorney and broker.
Landowners offered a ground lease by a developer, developers handed a landowner's lease form, owners on an old lease that is getting hard to finance, investors setting standards for buying ground leases, affordable housing developers, and lenders or counsel who want a second read.
It depends on what you need. Usually a retainer for the work and a fee at closing when we create the transaction, agreed in writing before we start.
Neither. We do not list property and we do not give legal advice. We size, structure and write ground lease transactions, and we bring the sponsor and the land investor together.
Then we make that transaction: we bring the land investor, write the lease and arrange the leasehold debt. You know before you sign anything which seat we are in and how we are paid.
The draft or the existing lease, the property, and what you are trying to decide. We will come back with what we would do and what it costs.