Start with the project, not a universal rule
Buying land can provide durable control and residual value, but it requires acquisition capital and exposes the owner to land value and disposition risk. A ground lease can preserve capital and separate land from improvements, but it introduces term, renewal, rent, assignment, financing, and end-of-term considerations.
The correct choice depends on the use, improvement life, financing structure, organizational objectives, and realistic alternatives.
Compare economics across the same period and downside cases
Model purchase price, financing, taxes, carrying costs, residual value, sale costs, and opportunity cost beside ground rent, escalations, percentage or adjustment mechanisms, options, taxes, insurance, and other tenant responsibilities.
Use conservative scenarios for delay, higher construction cost, lower operating performance, refinancing pressure, and an exit earlier or later than expected.
Examine control, financeability, and flexibility
Lenders and investors may require mortgage rights, notice and cure, assignment rights, nondisturbance, sufficient remaining term, and clear ownership of improvements. Operators may value relocation flexibility differently from developers making long-lived improvements.
Qualified legal, tax, accounting, lending, and real-estate advisers should review the specific structure.
Apply the framework to a defined Seven Hills proposal
Seven Hills is open to purchase and flexible ground-lease discussion. A useful comparison needs a proposed use, approximate premises, improvement program, target date, hold period, and financing plan.
Request current terms from the owner only after defining enough of the project to compare structures honestly.