Q: Hello, I have large company interested in a five year option to either purchase or ground lease a property I co-own.
The terms to lease the property are really appealing but the company plans to use the lease to secure funding for a green energy project. If I were to lease the property, as a land owner Is there anyway to protect the property from foreclosure in the event company goes bankrupt and creditors go after the property?
A: You need the advice of a Real Estate Transaction attorney in your local area to assist you to draft a lease that has forfeiture provisions in the event the lessee goes bankrupt. The creditors cannot go after the property, as you do not transfer title to the property to the lessee, except for the term of the lease. You really need to get an attorney in on drafting this complex commercial lease with an option to buy. You need clauses that say this option is personal to the lessee and any attempted voluntary or involuntary transfer is void. Banks do this in home loans, you cannot sell the property subject to the loan, the loan closes and a new loan opens.
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