What is a lease?
A lease is an agreement between two or more parties for one party to temporarily take control of an asset of some kind. We typically think of leases as being for buildings or units within a building, but leases can be used for equipment or other assets, as well. For investors, leases of all types are important to consider since many businesses will lease equipment and real estate, though real estate leases are far more universal.
Most people are familiar with basic leases and how they work. There’s an agreed-upon price per time unit (monthly, weekly, etc.) and lease terms, which include how you may or may not use the asset. There’s also a penalty involved in most leases, which the owner of the property can receive if you fail to pay your agreed-upon fee or damage the property significantly.