Understanding a Build-to-Suit (BTS) Lease In Real Estate Investing A build-to-suit lease is a leasing plan where a property owner and renter, typically entrepreneur, agreement with a developer to construct a residential or commercial property to their particular commercial needs. The landlord normally does not bear the in advance expenses of construction. Instead, the designer recovers their investment by leasing the residential or commercial property to the landlord after its completion. This type of real estate lease is ideal for tenants that need a tailored structure to run an industrial operation. In addition, the industrial designer is normally responsible for providing raw land and creating and constructing the commercial building according to the tenant's organization needs. What Is a Build-to-Suit Lease & How Does It Work? In commercial property investing, a build-to-suit lease involves a residential or commercial property designer and proprietor accepting rent a custom-made structure for a fixed variety of years. This plan allows a renter to occupy a specially made residential or commercial property that satisfies their specifications without having to front the capital for building and construction themselves. For example, a commercial enterprise that needs an office complex with particular specs may get in into a BTS lease with an advancement company that owns an undeveloped parcel. The company would deal with the developer to develop the workplace on the rented land. Before construction, the length of the lease, month-to-month rental rate, and build-out requirements are negotiated. Then the occupant may continue with the move-in and occupancy process once the build-to-suit advancement is complete. As an outcome, the developer is essentially ensured a tenant for their newly developed residential or commercial property. What Are the Different Types of BTS Leases?