The Ground Lease model is gaining significant traction in India’s industrial land market, offering a flexible and capital-efficient alternative to outright land sales. Under this model, landowners retain ownership of the land while granting long-term lease rights, typically spanning 30 to 99 years, to industrial occupiers or developers. This structure enables occupiers to construct and operate custom industrial facilities without the high upfront costs of land acquisition, making it particularly attractive to logistics operators, manufacturers, and build-to-suit (BTS) developers seeking to optimize capital allocation.
For landowners, the ground lease model provides a steady, predictable income stream while preserving long-term asset control and benefiting from appreciation over time. It also opens up monetization opportunities through institutional investment, as many REITs and private equity funds favor long-term leased land parcels with income stability. Developers, on the other hand, can enter new markets with reduced risk and capital exposure, enabling faster development timelines and broader tenant reach, especially in industrial corridors, logistics parks, and emerging cluster zones.
This model aligns well with national initiatives such as PM Gati Shakti, National Industrial Corridor Development Programme, and state-led industrial policies, which emphasize scalable, sustainable land use planning. Ground leasing is becoming particularly popular in states like Tamil Nadu, Maharashtra, Gujarat, and Telangana, where land values are high and demand for flexible occupancy terms is surging. As the industrial real estate sector evolves, the ground lease model is emerging as a mutually beneficial strategy, balancing investor returns with user affordability and redefining long-term land utilization in India’s industrial landscape.
