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  • videocam Live Online with Live Q&A
  • calendar_month January 15, 2026 @ 1:00 PM E.T.
  • signal_cellular_alt Intermediate
  • card_travel Real Property - Transactions
  • schedule 90 minutes

Structuring Sandwich Leases: Key Provisions to Benefit Owners, Investors, and Subtenants; Tax Considerations

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Discount expires 11/19/25

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Description

A sandwich lease refers to a complex commercial or residential lease structure where one party, usually an investor (also sandwich tenant), leases a property from the owner and subsequently leases it out to a third party (subtenant) for a higher price to make a profit. The transaction often includes a lease purchase option that grants the investor and/or the subtenant the right to purchase the property at a predetermined price within a specific timeframe. 

There are typically two leases involved in the transaction—the lease between the owner and investor, and between the investor and subtenant. And there are unique considerations for each party that should be reflected in the lease provisions. For example, the sandwich tenant may assume many landlord responsibilities, which benefits the owner who has a potential buyer and earns rental income without the responsibilities of being a landlord. However, this increases financial risk and hands-on management for the sandwich tenant. On the other hand, the sandwich tenant is able to enter the real estate market with limited capital and potentially earn rental income. Additionally, a purchase option may give the investor and/or subtenant the ability to buy the property at a predetermined price while benefiting from any market appreciation during the option period.

When considering leasing strategies, counsel should be aware of the benefits and risks of a sandwich lease for their clients, under what circumstances this type of lease is most beneficial, and how to structure the deal to minimize client risk whether representing the owner, sandwich tenant, or subtenant.

Listen as our expert panel provides a comprehensive overview of sandwich leases. The panel will discuss drafting considerations for leases including purchase options, address tax considerations, and offer best practices for minimizing risks for all parties.

Presented By

Corin M. Korenaga
Partner
Cox Castle & Nicholson LLP

Mr. Korenaga is a leading transactional attorney who focuses on complex acquisitions, dispositions, space leasing, ground leasing, mergers and acquisitions, and joint venture deals across several real estate product types. He represents real estate owners, developers, and investors, as well as landlords and tenants of office, residential, industrial, retail, and medical office properties. Mr. Korenaga’s extensive experience and industry knowledge allow him to strategically and efficiently structure, negotiate, document, and close transactions, all while paying close attention to clients' business objectives. He has particular expertise in representing homebuilders nationally. Mr. Korenaga also represents landlords and tenants in negotiating sophisticated office, industrial, retail, medical office, and ground leases.

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Adriana Vesci
Partner
Cox Castle & Nicholson LLP

Focused on real estate finance and development, Ms. Vesci is known for getting lenders, investors, and developers workable results by using the skills she has gained from each side of the negotiation table. She works well with all clients and can anticipate their needs, regularly helping clients to negotiate, document, and close complex real estate secured financing transactions. Ms. Vesci also counsels institutional investors and developers in connection with real estate acquisition, disposition, joint venture, pooled investment, and financing activities. She represents every type of lender, from large national banks and life insurance companies to community banks and private lenders. Ms. Vesci also counsels borrowers in connection with all of their financing needs. 

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Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.


  • Live Online


    On Demand

Date + Time

  • event

    Thursday, January 15, 2026

  • schedule

    1:00 PM E.T.

I. Introduction: sandwich lease vs. traditional sublease

II. Structuring the transaction

A. Purpose

B. Parties

C. Transaction documents

D. When to consider a sandwich lease

III. Key lease provisions to protect the parties

A. Owner

B. Investor/sandwich tenant

C. Subtenant

IV. Purchase options

V. Tax considerations

VI. State law issues

VII. Practitioner takeaways

The panel will review these and other important issues:

  • When is a sandwich lease preferable to more traditional leasing structures?
  • What are unique lease provisions for the owner in a sandwich lease? For the investor/sandwich tenant? For the subtenant?
  • What are tax considerations for each party? 
  • What are best practices for ensuring consistency between the lease documents to minimize the parties' risks and achieve their transactional goals?