Leasehold Development

Customized affordable housing solutions

Terra uses our expertise in uncommon leasehold ownership structures and complex real estate development management deals to create tailored affordable housing solutions for projects in which a typical rental or condominium model is not appropriate.

Leasehold development is a cross between owning and renting. A resident purchases a long-term leasehold interest, which is registered on title. When they move out, the resident gets their money back, minus a deduction for refurbishing and remarketing. Different mechanisms can be used to share any proceeds from market appreciation after the resale of a unit.

Our custom-built approaches range from affordable leasehold homeownership, which helps first-time home buyers find affordable homes and build equity, to life lease housing, which provides seniors with financially secure, maintenance-free, socially connected housing, enabling them to maintain independence and vitality as they age.

What is life lease housing?

Life lease housing is an approach to seniors housing typically designed for older individuals who have an existing housing asset, usually a mortgage-free single-family home, and are looking to downsize to live a community with others in a similar life phase. Life lease housing is owned and operated by a trusted nonprofit.

How does affordable leasehold homeownership work?

Our proprietary affordable leasehold homeownership model is designed for low- and middle-income individuals and first-time home buyers, usually in urban environments. It uses long-term government-partner financing as a way for new buyers to purchase only part of their home, increasing affordability for younger people. The building is owned and managed by a nonprofit organization, protecting the resident from unexpected costs as well as maintaining affordability over time.

Key Contacts

Stephen Mancer
Principal, Director of Real Estate
Terra Leasehold Developments
stephen.mancer@luminaservices.com
212 328 7064

Kate Mancer, MA
Life Lease Housing Expert
Terra Leasehold Developments
kate.mancer@luminaservices.com
604 908 8203

Simon Davie
CEO and Managing Partner
Terra Social Purpose Real Estate
simon@terrahousing.ca
604 639 0472

Leasehold Development Services

Terra provides complete development management services for clients who are looking for leasehold ownership structures outside the typical models. We work closely with you to understand your unique objectives, assets and opportunities to create a structure and solution that suits your needs.

Deal origination and corporate structuring

We help put together a project and partnership structure that meets your specific short- and long-term needs. We take an inventory of your assets and opportunities, investigate market demand, negotiate property acquisition, and create a project plan that is capable of achieving funding. Our leasehold development team specializes in deal structures outside the typical rental or condominium ownership models. Examples include our affordable leasehold home ownership model, tailored to first-time home buyers, and our life lease housing model, providing support and stable housing for seniors.

Securing equity and debt financing

A variety of options exist for funding real estate development projects, which can be selected based on your goals and objectives. We understand not only how different levels of government funding can come into play for a potential project, but also how to best leverage existing assets in the private debt and equity markets to ensure funding is available to complete a development project. Our ability to determine financial viability and profitability for private interests, based on the time-value of money, can be what allows a project to go forward, while still meeting the objectives of your organization. We have the proven ability to set up deals that mix both government and private capital to ensure project success.

Terra has decades of experience in the entire development management process, specializing in affordable housing for nonprofit organizations. We guide you through the entire process, ensuring a solid financing strategy, bringing design and planning consultants on board, planning and executing the construction phase, and supporting the move-in process. We even have asset management and property management professionals on our team, should you need those services once occupancy is complete.

Development services

Preparation of leasehold legal documentation

In a leasehold development, the value of the project rests in the leases that are registered on title and give the residents the right to occupy the units. These leases are extremely complicated and must be written with great care to ensure that the interests of the residents, lenders, and sponsoring organization are accounted for. Understanding the unconventional nature of these leases requires deep technical expertise to ensure that the leases actually do what they are designed to do.

The sales and marketing of leasehold units needs to be approached in much the same way as a regular condo development. This requires coordinated branding and marketing campaigns in appropriate media streams, and a functional and appealing sales office with mockups of unit finishes and layouts. These costs will run into the millions of dollars. Taking a gamble on an “if you build it, they will come” approach does not work, no matter how good the project is. Regardless, private financial partners require presales. At Terra, we ensure that all marketing activities remain on message and on brand, and ensure that buyers understand the leasehold product they’re buying, all while remaining onside of consumer protection legislation.