COVID-19 Pushes the Modern Ground Lease Space into the Spotlight

Although the last few decades have seen the ground lease develop a bad reputation as many real estate partnerships on high-profile assets in New York went south, the last several months have seen an uptick on “institutional players keen to buy, restructure or originate ground leases” entering the market. Coupled with the economic realities of COVID-19, “ground lease 2.0” has a much more predictable cash flow stream and no fair market value resets; and has captured the attention of the broader market with players “betting on the safety and predictability of a ground lease as a no-frills value play amid an uncertain investment climate.”