Leasehold value

The value of a tenant's interest in a lease which can be significant when the rent is below market and the lease has a considerable term remaining. Example: When land rent for an acre of Manhattan was $10,000 per year, a knowledgeable investor bought the rights of a 99-year lease. A comparable TRACT today commands $150,000 annual rent. The lease-hold value of the subject property is the present value of the bargain rent ($140.000) over the remaining lease term.