Ground Lease, Absolute NNN, Leasehold

Let's talk depreciation - the IRS allows a deduction on your taxes based on the assumption that the physical structure of the property deteriorates over time. That's great if you actually own the structure. In a ground lease investment, all you buy is the dirt. The tenant owns the building and benefits from the depreciation. In a leasehold purchase, you the investor buy the structure and NOT the ground. You then benefit from the depreciation of the structure. And in between, is the standard ownership structure where the investor buys the land and structure and lease the same to the tenant. In this case, the investor depreciates the structure only and not the value attributed to the land. The moral of the story is: know your tax situation and choose the investment best suited for it.