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Locations

Southeast

Co-Head of Investments
tdoherty@istar.com
212.930.9433
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Better capital

better returns

a new frontier for real estate owners, developers & operators

Safehold™ ground leases offer a more efficient capital solution relative to fee simple ownership, requiring less equity and delivering attractive long-term, risk-adjusted returns.

POWER OF A SAFEHOLD™ GROUND LEASE

fee simple

with a safehold™ Ground Lease

$30.0M Equity

(30% of Property Value)

Property

$5.25M NOI  /  5.25% Cap Rate  /  $100.0M Value

$19.5M Equity

(30% of Leasehold Value)

$70.0M Loan
4.25% Pricing
10yr Term

(70% of Property Value)

$45.5M Loan
4.25% Pricing
10yr Term

(70% of Leasehold Value)

SAFEHOLD™ ground lease

$35.0M  /  3.75% Initial Yield
Fee Simple Cap Stack $100.0M
Leasehold Cap Stack $65.0M

$100.0M

Same Purchase Price

$100.0M

$30.0M

Less Equity REQUIRED

$19.5M

1.76X

BETTER DSCR

2.04X

7.6%

SUPERIOR CASH-ON-CASH RETURNS

10.3%

13.8%

HIGHER IRR's (10 YEAR HOLD)

18.3%

2.83X

HIGHER MULTIPLES (10 YEAR HOLD)

3.73X

POWER OF A SAFEHOLD™ GROUND LEASE

Property

$5.25M NOI  /  5.25% Cap Rate  /  $100.0M Value
$35.0M  /  4.0% Initial Yield

SAFEHOLD™ ground lease

fee simple

With A SAFEHOLD™ GROUND LEASE

$25.0M Equity

(25% of Property Value)

$16.2M Equity

(25% of Building Value)

$75.0M Loan

10yr Term

T+200 Pricing

(75% of Property Value)

$48.8M Loan

10yr Term

T+200 Pricing

(75% of Building Value)

Fee Simple Cap Stack
$100.0M
Leasehold Cap Stack
$65.0M

Same Purchase Price

Fee Simple
Ground Lease

$100.0M

$100.0M

Less Equity Required

Fee Simple
Ground Lease

$25.0M Loan

$16.2M

Better DSCR

Fee Simple
Ground Lease

1.40x

1.58x

superior cash-on-cash returns

Fee Simple
Ground Lease

6%

8.7%

HIGHER IRRs [10 YEAR HOLD]

Fee Simple
Ground Lease

13.5%

18%

higher multiples [10 year hold]

Fee Simple
Ground Lease

2.89x

3.80x

A capital advantage in a competitive market

Our modern ground lease structure is a stable, predictable, long-term capital source that eliminates interest rate and refinancing risk – enhancing equity value relative to alternative capitalization methods.

enhanced return ProfilE

Safehold™ ground leases deliver increased cash-on-cash returns and overall IRRs relative to fee simple capital structures, while offering substantial tax advantages for leasehold owners.

leasehold lender-friendly

Our carefully constructed ground lease has been approved by numerous leading lenders, including banks, CMBS, life companies and agencies.

No Friction Costs

With a Safehold™ ground lease in place, customers eliminate sizable financing fees, transfer fees and mortgage recording fees – now and in the future.

Custom-Tailored to unlock value

Our manager, iStar, has built its reputation on helping partners find creative solutions for over two decades. We work to carefully create a properly sized, properly structured ground lease to unlock the most value for the building owner. We're equipped to close quickly and committed to giving our customers a competitive edge.

Versatile lease structure

Our modern ground lease works with all property types — including multifamily, office, hospitality, industrial — and provides better capital at all points in a property’s life cycle — at construction, at recapitalization or refinancing, or when a sale or purchase is planned.

Case studies

The formative stories of the modern ground lease revolution.
1111 PENNSYLVANIA AVE  //  WASHINGTON, DC
Multifamily // Washington, DC
Admiral Capital Group // Phoenix & San Diego
Novel Music Row // Nashville, TN
SAFE x STAR

A ONE-STOP CAPITAL SOLUTION

The SAFE x STAR program offers a powerful combination of a Safehold™ ground lease and either leasehold mortgage or leasehold equity capital from iStar, Safehold’s founder and manager, within the same transaction. Customers benefit from a customized, streamlined capital solution with lower costs, reduced maturity risk and flexible structuring options in comparison to other alternatives.
SAFE x SWAP

Out with the old, in with the New

Real estate investors are no longer forced to suffer from poorly-designed ground leases. Under the SAFE x SWAP program, Safehold works with customers to purchase and restructure outdated ground leases, stripping away detrimental provisions in favor of a modern framework that unlocks significant value.
“Safehold created an innovative capital solution that has changed the way the industry thinks about capitalization. They’re leading the way as this redefined product type continues to scale.”
- ADAM SPIES, Chairman of Capital Markets, Cushman & Wakefield
“We saw the Safehold ground lease structure as a way to materially improve our risk-adjusted returns and set up a win for our investors.”
- ANTHONY DILWEG, CEO/Founder, The Dilweg Companies
“I had been following the bifurcated ownership model and was put in touch with the Safehold team to look at two deals we had under contract. The proposal from Safehold just made economic sense.”
- ANDY STONE, Managing Partner, Admiral Capital Group
get in touch

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We target the top 25 MSAs in the United States with national coverage broken down by five regions: East Coast, West Coast, Southeast, Midwest and Texas
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