CalculateRealEstateROI

Financing

Ground Lease

Long-term land lease to operator/developer; landlord owns dirt, tenant owns improvements.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Core concepts

Yield + reversion

Steady ground rent + improvements revert at term end.

Long duration

50–99 year terms common.

Examples

  • 99-year ground lease at $200k/year, 2% escalators, McDonald’s tenant.

Practical applications

  • Generational wealth strategies.
  • Trust and family-office portfolios.

Common mistakes

  • Mispricing reversionary value.
  • Allowing leasehold mortgage without subordination.