Safehold's Ground Lease Model Earns Housing Innovation Spotlight

NEW YORK, NY – February 19, 2026 – Safehold Inc. (NYSE: SAFE), a firm that has reshaped commercial real estate financing, has been named a finalist for the prestigious 2026 Ivory Prize for Housing Affordability. The nomination recognizes the company's modern ground lease model as a potent financial tool in the nationwide struggle to create and preserve affordable housing.

The announcement places Safehold among a select group of innovators celebrated for developing feasible and scalable solutions to a crisis that has left millions of Americans without access to affordable homes. The recognition underscores a growing consensus: tackling the housing shortage requires not just more bricks and mortar, but also more sophisticated capital structures.

"We're proud to be part of the solution to address the considerable unmet demand for affordable housing," said Steve Wylder, Safehold's Head of Investments, in a statement. "Housing affordability is a challenging issue, especially as elevated interest rates and construction costs put added pressure on developers. Safehold's ground lease capital has proven very useful in bridging capital structure gaps and moving projects forward."

The Anatomy of an Innovation

At the heart of Safehold's acclaimed approach is the modernization of a centuries-old real estate concept: the ground lease. In a traditional property sale, a developer buys both a building and the land beneath it. Safehold's model splits the two. The company acquires the land and leases it back to the building owner, typically for 99 years, under a long-term, predictable contract.

For affordable housing developers, this separation of assets is transformative. It dramatically reduces the large upfront capital required to purchase land, which is often a prohibitive barrier, especially in high-cost urban markets. By removing the land cost from the initial equation, developers can redirect capital toward construction and other project-critical expenses. This financial maneuver can be the deciding factor that allows an otherwise unviable affordable housing project to proceed.

This structure is particularly crucial for developments utilizing the Low-Income Housing Tax Credit (LIHTC) program, a primary driver of affordable rental housing construction in the U.S. These projects often operate on razor-thin margins and face complex financing needs. The additional capital efficiency provided by a ground lease can increase a project's permanent proceeds by 10% to 20%, providing the necessary cushion to navigate development hurdles.

A Crisis Demanding New Solutions

The company's nomination comes at a critical juncture for the U.S. housing market. The nation is grappling with a severe and deepening affordability crisis. According to the National Low Income Housing Coalition, the country has a deficit of over 7 million rental homes that are affordable and available to the lowest-income households.

This staggering shortage has tangible consequences. A 2025 report from the Department of Housing and Urban Development (HUD) found that 8.46 million households suffer from "worst case" housing needs, meaning they pay more than half their income for rent or live in severely inadequate conditions without any government assistance. Meanwhile, homelessness reached a record high in 2024, a direct symptom of the affordability gap.

In this environment, traditional development models are under immense strain. Fluctuating interest rates, soaring construction material costs, and labor shortages have made it increasingly difficult for both for-profit and non-profit developers to build housing that is affordable to the average American, let alone the most vulnerable. This reality has spurred a search for new tools and strategies to unlock development.

Validation from Industry Experts

The Ivory Prize, awarded by the University of Utah's Ivory Innovations, serves as a key validator in this search. The prize is designed to identify and amplify the most promising solutions across finance, construction, and policy. By naming Safehold a finalist, the prize's advisory board, composed of leading housing experts, signals that the modern ground lease is a credible and powerful mechanism for systemic change.

"There is no silver bullet for our nation's housing crisis, but this year's Ivory Prize finalists are delivering proven solutions to the diverse set of challenges that keep costs high," commented Chad Reed, Vice President of Programs and Strategy at Ivory Innovations. He noted that in a "fragmented, risk-averse housing industry, the Ivory Prize exists to elevate what works so others can learn from these great solutions and examples and replicate them at scale."

Safehold's inclusion in the Finance category alongside organizations like the City of Boston's Mayor’s Office of Housing and MassHousing highlights a trend toward creative public-private financial frameworks designed to inject new liquidity and efficiency into the affordable housing ecosystem.

From Theory to Reality

Since establishing a dedicated Affordable Housing team in 2025, Safehold has rapidly demonstrated the real-world impact of its model. The company has closed more than 19 ground leases for housing credit developments since its first LIHTC transaction in 2023, facilitating the creation of thousands of affordable units.

Recent projects showcase the model's utility in some of the nation's most expensive markets. In California, Safehold has partnered with The Pacific Companies on multiple developments, including a 200-unit asset in Santa Clara and 781 units across San Jose and Concord. These projects, located in high-cost, land-constrained areas, were made feasible by the ground lease structure, which helped bridge critical funding gaps.

Another example is a 207-unit LIHTC development in Woodland Hills, Los Angeles, with developer Meta Housing. By providing the ground lease capital, Safehold enabled a project that will deliver much-needed affordable housing to the Warner Center area, with completion expected in 2028. These tangible outcomes move the ground lease from a clever financial concept to a concrete solution producing homes for families.

The strategy is not just about enabling new construction but also about ensuring long-term affordability. The 99-year leases with fixed, predictable rent increases provide stability for project finances, helping to keep rents affordable for decades to come. This aligns with the mission of many housing agencies and non-profits, which increasingly see ground leases as a way to maintain stewardship over land use while partnering with private sector efficiency. This growing acceptance suggests that the ground beneath affordable housing development is, quite literally, shifting.