Structures · Insights
When a ground lease outperforms a build-to-suit purchase
Credit tenants, land basis, and residual value decide the structure. Here is how 6S underwrites the choice with landlords and operators.
A ground lease is not a consolation prize for a deal that could not be purchased. For the right credit and the right corner, it is often the cleaner instrument.
Landowners keep the residual, tenants control the box, and both sides can underwrite a 20- to 50-year cash flow without taking on the other party's balance-sheet problem.
6S models hold vs. sale, entitlement timing, and lender appetite before anyone drafts an LOI. The structure should fall out of the numbers — not the other way around.
If your prototype is national and your real estate team is thin, a ground lease plus construction management can get you open without a local development staff.
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Landlords, tenants, investors, and municipalities use 6S Development as a single point of accountability from site through occupancy.