GLR Ground Lease

About

Ground Lease REIT (“GLR”), a dedicated vehicle specializing in the origination and acquisition of unsubordinated long-term ground leases, was formed in 2020 by Montgomery Street Partners (“MSP”). The MSP investment team has over 100 years of real estate investment experience, including over $250 billion of transactional activity and experience managing a $10 billion real estate credit portfolio at a prior financial services firm. MSP and its predecessor entity have acquired and developed over $3 billion of commercial real estate since 2013, with a focus on niche, durable real estate sectors, including manufactured housing, student housing, seniors housing, affordable living, self-storage, infill industrial, and other opportunistic investments. GLR is sponsored and managed by Montgomery Street Partners.

Investment Strategy

GLR’s ground lease investment strategy is to originate 99-year senior unsubordinated ground leases on developments, value-add projects, and stabilized assets with the following characteristics

  • Transaction Size: $10 million – $150 million (gross value of ground lease)
  • Ground Lease to Property Value: 25% – 40%
  • Ground Rent Coverage Ratio: 4.0x – 7.0x, representing 14% – 20% of pre-ground rent NOI
  • Ground Lease Duration: 99 years
  • Ground Lease Structure: Absolute NNN with annual rent escalators and periodic CPI adjustments
  • Target Markets: Top 50 MSAs
  • Property Types: Multifamily, student housing, seniors housing, mixed use, office, industrial, retail, and hospitality

More About GLR
To print a one page overview of GLR, download the GLR one-pager.