A ground lease is a land-lease of long-term, ranging from 50 to 99 years. It includes the landowner and the tenant between whom this deal has been closed. This is one of the safest ways of investing in a real estate property with feasible benefits. Generally, it is of two types- unsubordinated and subordinated, depending on the nature of profit that the landowner enjoys. In the former one, the owner has the top priority, and in the later, the owner limits his claim on the land for better negotiation.
In Ground Lead, the tenant gets the chance to borrow a piece of land in a prime location to suit his/her business needs. Furthermore, the person is free to construct or develop any kind of building that appreciates the trade and enhances the worth of the land. By virtue of this lease, the tenant does not have to splurge a huge amount to buy a land but can sow and reap harvest on the borrowed land with equal élan. However, he/she will have to pay the taxes and maintenance fees of the land during the term.
Although the land is leased and utilized by the tenant, the landowner remains the actual possessor. The person enjoys the monthly rent and achieves more advantage. This is because after the termination of the deal, the land along with the constructions gets transferred to him (if no other special clauses exist). Moreover, the owner also has the right to abandon the ground lease and take full control of the land in cases of tenant default.