Its not a gross ownership model. These things are set up this way because different groups of people will pay different amounts of money for different bundles of things that are taxed at different rates/advantages depending on their use. The land lease has scheduled payments for the next ~100 years, long beyond the time horizon of DCFAs that anyone is doing for investors. Many buildings in NYC and elsewhere have this ownership model. Why should a land owner be into construction and and why should a land owner be exposed to the volatility of commercial real estate rents if they don't need to be.