Master Lease in a Syndication

We are in serious talks with the seller of a great park in a great metro. 150+ pads, city services, meat on the bone.

They converted their C Corp to an S Corp to save tax on cash flow. However, they would have to pay extra tax if they sell their park, in its S corp entity, if they sold it within 5 years of the conversion to S Corp, which happened 1 1/2 year ago.

Since they would pay a hefty tax bill, we proposed a master lease with option to purchase at the end of the 5 years (3.5 years from now). The seller is amenable to that; however, we have no idea how this would work in a syndication.

Does anyone have any experience with syndicating lease option deals?

Speak with a securities attorney with experience structuring these types of deals. They should be able to help you structure this or tell you why it isn’t possible.

We’ve done a master lease with JV partners, not a syndication…

If I can be of any help let me know

I would think also loop in a real estate attorney that is licensed in your state. Cover all of your bases. You can do this with an LLC. Many different ways to make this killer deal, happen.


IMHO, If audited the seller will likely lose. The master lease structure will be seen for what it is, tax avoidance.