Tax Credit Advisor
Abram Mamet
In recent years, developers have turned to the centuries-old concept of ground leases as a powerful tool in the contemporary struggle to pencil deals and close increasingly wide funding gaps.
Ground leases have roots going back to at least 11th century England when feudal landholding structures necessitated long-term land leases. Though the concept has certainly transformed over time, the basic structure is still the same: an owner will lease land to a tenant for a long term; the tenant then—depending on the lease terms—can construct, own and benefit from improvements, such as buildings. This is, of course, an alternative to a typical fee simple ownership, where one single entity owns both the land and the improvements upon it.
