Brookfield Buys $348M Stake in Safehold Ground Lease Portfolio
Brookfield has purchased a $348 million stake in Safehold Inc.'s ground lease portfolio in the U.S.
Under the new joint venture, Safehold will continue to manage day-to-day control of the assets, with Brookfield holding just 49 percent equity in the portfolio. Also, Safehold plans to retain various call options and will repurchase Brookfield's stake in the portfolio after year seven of the venture.
The move for Brookfield gives it access to high-quality ground leases located in major markets, which were not disclosed. For Safehold, this will boost its liquidity and de-leverage its balance sheet, allowing it to pursue new ground lease opportunities. Plus, the New York-based firm said it will use the proceeds to pay back debt and for general corporate purposes.
"We continue to see compelling opportunities to deploy flexible capital across high-quality real estate investment opportunities supported by durable real estate fundamentals and stable cash flows while tailoring capital solutions to support our partners' balance sheet objectives," Ben Brown, co-president of real estate at Brookfield, said in a statement.
The portfolio overall sees annual cash rent of roughly $14 million.
On the deal, Safehold was advised by Eastdil Secured, L.L.C. and BofA Securities.
At GlobeSt.'s, Net Lease Spring 2026 event, Ben Hidalgo, CEO of Net Lease Development, noted that he was starting to see more ground leases take place, even though he described the overall deal flow of the market as "thinner," as interest rates remain volatile.
But one of the key themes throughout our event is that net lease deal structures are changing amid uncertain times. That's not necessarily a bad thing — it's just one way to navigate around the spike in costs.
Source: GlobeSt/ALM