Robert Khodadadian — Skyline Properties — Manhattan — NYC Ground Lease
Analyze ground lease economics for your property. Calculate ground rent, capitalized value, and understand the financial structure of 99-year leases.
Calculate the income potential of creating a ground lease on your land.
Ground Lease
A ground lease is a long-term land lease arrangement, typically 49-99 years, where a landowner (ground lessor) leases land to a tenant (ground lessee) who develops or operates improvements on the property. The tenant pays ground rent and owns the building, while the landlord retains ownership of the land and receives the improvements at lease end.
Ground rent is typically calculated as a percentage of the land value, usually 4-6% annually depending on market conditions, location, and lease terms. For example, a $50M land parcel with a 5% ground rent factor would generate $2.5M in annual ground rent.
Ground leases allow landowners to retain long-term ownership of valuable land while generating steady income. Benefits include: steady cash flow without property management responsibilities, retaining the underlying asset for future generations, and eventual ownership of improvements at lease end.
Ground lease tenants benefit from: lower upfront capital requirements (no land purchase), lower property taxes (only on improvements), potential for better returns on invested capital, and access to prime locations that might otherwise be unaffordable.
In Manhattan and NYC, ground leases typically range from 49 to 99 years, with 99-year leases being the most common for institutional-quality assets.
Robert Khodadadian and Skyline Properties have closed numerous ground lease transactions totaling over $200M+ in value. Our expertise includes structuring new ground leases, ground lease buyouts, subordination negotiations, and identifying off-market ground lease opportunities.