Why lease out your land?
The challenge is that we are very short on housing for working families. One reason is that when land becomes available private developers often focus on the “highest and best use” which around here often means building $400,000 condos for retirees.
The problem is that our essential workers, in healthcare, education, public safety, and manufacturing, cannot find affordable housing. This limits everyone’s ability to prosper in our fair valley, employees have a hard time saving or take jobs elsewhere while employers struggle to hire the staff they need.
We have lots of land, but many landowners (families, churches, fraternal organizations, and businesses) do not want to sell their land even if they don’t want to develop it in the near future. Leasing lets the owner own and a developer build with lower upfront costs.
Benefits to the landowner
- Retain ownership and future appreciation of land
- Regular income
- Avoid capital gains that a sale might trigger
- Little to no upfront costs to create cash flow
- Can support the community by making land available for a great cause
Benefits to the community
- More housing faster with lower upfront costs
- Secures the land for the life of the building
- More people willing to lease than to sell
- Prime locations become more accessible – walkability and transit are key
How does it work?
- Most land leases are quite straightforward and last 60+ years
- Owner agrees to allow the developer to use the property to build and operate housing for upto 99 years
- All zoning rules and regular escrow processes are followed
Land Lease Essentials
- Ground Lease Fundamentals in Commercial Real Estate – PropertyMetrics
- Ground Lease: What Is It? Pros and Cons
- What Are Land or Ground Leases and How Do They Work?
- Basic info specific to farm land leases