Ground leases are sophisticated contracts combining the elements of buy/sell agreements, commercial leases, and a sophisticated financing. A landowner enters a long-term lease with a developer who constructs a building or other improvements on the land. The developer generally finances the building, occupying it or leasing it out to other tenants, paying the landowner rent on the underlying ground over a long period of time. There are many benefits of ground leases for the landowner and the tenant. But they are very complex agreements involving sophisticated economic calculations and require very careful review. This program will provide you with a practical guide to how ground leases work, and negotiating and drafting them.
- Overview of important provisions of ground leases
- Underlying economics of ground leases
- Permitted use and change of use
- Methodologies for setting and adjusting rent to reflect risk and value over time
- Major financing issues, including subordination
- Construction and development issues
- Special condemnation and casualty considerations
Note: This material qualifies for self-study credit only. Pursuant to Regulation 15.04.5, a lawyer may receive up to six hours of self-study credit in a reporting year. Self-study programs do not qualify for ethics, elimination of bias or Kansas credit.
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