Ground Lease


DEFINITION of 'Ground Lease'

An agreement in which a tenant is permitted to develop a piece of property during the lease period, after which the land and all improvements are turned over to the property owner. A ground lease indicates that the improvements will be owned by the property owner unless an exception is created, and stipulates that all relevant taxes incurred during the lease period will be paid for by the tenant. Ground leases are typically for 10 years or more.

BREAKING DOWN 'Ground Lease'

A ground lease is typically a long-term lease, as lease holders would be unwilling to build costly improvements if the benefit of such improvements could only be realized for a small number of years. For the landlord, a ground lease allows the assumption of all improvements once the lease term expires. This permits the landlord to sell the property at a higher rate. For the tenant, a ground lease keeps the tenant from having to purchase potentially expensive land in order to begin a development.

  1. Real Estate

    Land plus anything on it, including buildings and natural resources.
  2. Flipping

    A type of real estate investment strategy in which an investor ...
  3. Property

    1. Anything over which a person or business has legal title. ...
  4. Lease

    A legal document outlining the terms under which one party agrees ...
  5. Investment Real Estate

    Real estate that generates income or is otherwise intended for ...
  6. Deed Of Surrender

    A legal document that transfers property ownership for a specified ...
Related Articles
  1. Home & Auto

    9 Things You Need To Know About Homeowners' Associations

    Restrictive rules and high fees are just some of the things to watch out for before joining an HOA.
  2. Retirement

    Should You Buy Property On Leased Land?

    Find out what to consider before investing in a leased-land property.
  3. Home & Auto

    Tips For The Prospective Landlord

    Investing in rental property can generate serious income, but there's more to it than collecting rent.
  4. Personal Finance

    How A Bad Roommate Can Ruin Your Credit Score

    Living with someone can cut your expenses, but in addition to not doing the dishes, your roommate may do serious damage to your credit.
  5. Home & Auto

    Do You Need A Home Inspection?

    This step is important when purchasing a property because it may save you thousands.
  6. Home & Auto

    Rental Properties: Cash Cow Or Money Pit?

    Create a valuation system to forecast the profitability of an income-producing property.
  7. Personal Finance

    6 Tips For Renting An Apartment

    Find out what you can do to find a fabulous apartment to fit your budget.
  8. Home & Auto

    Rent-To-Own Real Estate Full Of Pitfalls

    Before you consider this type of arrangement, you should be aware of how it works, who benefits and the many things that can go wrong.
  9. Retirement

    Are You Ready to Rent?

    If you think it's time to test your wings and leave your parents' nest, read on.
  10. Options & Futures

    Rent To Own; Own To Rent

    This method can help first-time buyers afford a home using a rent-to-own strategy, and it can also be good for investors.
  1. Does renters insurance cover storage units?

    An all-perils renters insurance policy provides coverage for the contents of storage units. Most policies limit the amount ... Read Full Answer >>
  2. Does renters insurance cover mold?

    An all-perils renters insurance policy typically provides a low set amount of coverage for damage caused by mold as long ... Read Full Answer >>
  3. Does renters insurance cover dog bites?

    A renters insurance policy typically provides liability coverage, up to policy limits, for dog bites unless the coverage ... Read Full Answer >>
  4. Does renters insurance cover theft?

    An all-perils renters insurance policy provides worldwide theft coverage for personal property after a claim exceeds the ... Read Full Answer >>
  5. Does renters insurance cover moving?

    An all-perils renters insurance policy covers damage to items resulting from a covered peril during a move. Limitations and ... Read Full Answer >>
  6. How much renters insurance do you need?

    You should have enough renters insurance coverage to replace lost or damaged items with new ones. On average, renters have ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  2. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  3. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
  4. Black Monday

    October 19, 1987, when the Dow Jones Industrial Average (DJIA) lost almost 22% in a single day. That event marked the beginning ...
  5. Monetary Policy

    Monetary policy is the actions of a central bank, currency board or other regulatory committee that determine the size and ...
  6. Indemnity

    Indemnity is compensation for damages or loss. Indemnity in the legal sense may also refer to an exemption from liability ...
Trading Center