Yield from the Day It Completes

A completed development earns nothing while it sits waiting for buyers or tenants. Sales absorption on a block can run for many months, and every empty month is finance being serviced against an asset producing no income. A bulk government lease turns the whole scheme into a guaranteed income stream from the point it begins. That changes the shape of the return. Instead of a slow drip of individual sales at uncertain prices, or a lettings operation stood up unit by unit, the scheme produces a fixed rent across all the units for a fixed term. For an owner carrying development finance, the speed of that income often matters more than squeezing the last few per cent out of each unit.

What it removes

The sales absorption period
Months of finance serviced against unsold units.
Marketing and show home costs
A material line on any development budget.
Unit-by-unit void risk
Each unit empty until a buyer or tenant is found.
Price uncertainty
Sale prices that soften if the market turns mid-sell.
A lettings operation
Standing up management across an entire block.

None of this means a bulk lease beats a strong sales market. In a rising market, selling units individually may well net more. The case for a bulk lease is strongest when finance is expensive, the market is uncertain, or the priority is turning a completed asset into income quickly and predictably.

How a Bulk Lease Is Structured

A block or development can be leased in more than one way, depending on the scheme and the requirement it is matched to. It may be a single lease of the whole building, or a set of leases across the individual units. RentPromise arranges whichever structure fits, and sets it out clearly before anything is agreed.

Whole-block lease

One lease of the entire building to the government body, with a single rent for the block for the term.

Unit-by-unit leases

Individual leases across the units, which can allow a phased start or a mix of uses within the scheme.

Phased placement

Units brought into the arrangement in stages, useful where a scheme completes in phases.

Part of a scheme

A portion of the units leased while others are sold or let privately, if that suits your exit.

The right structure depends on your finance, your exit plan and what the government body needs. Some owners want the certainty of the whole scheme placed at once. Others want to lease part and keep the option to sell into a recovering market. Both are workable, and we structure the arrangement around your position.

Read how the lease works in full

Who a Bulk Lease Suits

This is for owners with units to place at scale rather than a single property to let. The reader is usually carrying development finance or holding a completed asset, and is weighing a bulk lease against selling, letting privately, or holding and waiting. It suits some positions well and others less so.

It tends to suit

  • Developers with a completed scheme to monetise
  • Owners carrying expensive development finance
  • Institutional owners wanting predictable income
  • Build-to-rent operators seeking a guaranteed baseline
  • Anyone wanting income certainty over sale upside

It tends not to suit

  • Owners in a strong sales market with buyers waiting
  • Owners who want to sell units individually for capital
  • Owners needing the units back at short notice
  • Schemes where the numbers only work at full market rent
  • Anyone prioritising the highest possible price per unit

If your scheme is in a strong location with buyers lined up, selling will usually net more and a bulk lease is not the answer. If the scheme has completed into an uncertain market, or finance is eating the margin while units sit empty, the case for guaranteed income from day one becomes a great deal stronger.

What Is Covered Across a Block

The responsibility split works as it does for any government lease, applied across every unit at once. The body pays the rent for the term, is responsible for the condition of the units and repairs within them, and covers utilities and council tax. You retain the freehold, the structure and the ownership costs of the building.

Rent

A guaranteed rent across the units for the term, paid whether they are occupied or not.

Internal repairs

The government body carries the internal repairing obligation across the units for the term.

Communal areas and common parts

Handled through the block’s own management arrangements, which continue as the freeholder’s responsibility.

Building structure and envelope

Remains yours as the owner, as it would under any arrangement.

Utilities and council tax

Covered by the government body for the units under lease, for the term.

The line is the same as on any government lease, drawn across a whole building. The body carries occupation and internal condition across the units. You carry the structure, the common parts and the freehold, because those are the costs of owning the block rather than of the units being occupied.

See exactly what is included and who pays for what
FAQ

Block and Development Questions

Yes. Whole blocks and completed developments can be leased in bulk, either as a single lease of the building or as leases across the individual units. The structure depends on the scheme and the requirement it is matched to, and we set it out clearly before anything is agreed.

From the date the lease begins, rather than as units are sold or let one by one. That is the point of a bulk lease for a developer: the whole scheme produces a guaranteed rent from completion, without waiting out the sales absorption period on an empty building.

Often, yes. A portion of the units can be leased while others are sold or let privately, if that suits your exit. Phased placement is also possible where a scheme completes in stages. We structure the arrangement around your finance and your plans.

The common parts and communal areas stay with you as the freeholder and are handled through the block’s own management arrangements, as they are now. The government body carries the internal repairing obligation within the leased units for the term.

It depends on the market and your position. In a strong sales market with buyers waiting, selling individually usually nets more. Where finance is expensive, the market is uncertain, or income certainty from completion matters most, a bulk lease is often the stronger route.

Discuss a bulk lease for your scheme

Tell us about the block or development and we will come back with an indicative offer across the units, the term and the structure that would suit your position. No obligation.

Get a Rent Offer

Or call us on (612) 123 - 4456 78 to discuss the scheme directly.

Related Pages

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Government leasing scheme
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Guaranteed rent for developers and institutions

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Guaranteed rent by property type
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Guaranteed rent for flats and apartments

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Guaranteed rent for portfolio landlords
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How the lease works

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What our service costs
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