Lease Structure

How should a lease be structured in a project with leasing funds?

In a project that supports housing costs with leasing, the lease is between the CoC recipient or subrecipient and the landowner. Once a program participant is identified for the unit, the recipient or subrecipient then executes a sublease or an occupancy agreement with participant (§ 578.77(a)).

  • In Permanent Supportive Housing (PSH) projects there must be a sublease and it must be for a term of at least one year and automatically renewable upon expiration.
  • In Transitional Housing projects the sublease or occupancy agreement must be for a term of at least one month and be automatically renewable upon expiration (for a maximum term of 24 months).

Looking for definitions of the common CoC and ESG Program terms referenced throughout the Virtual Binders?

Virtual Binders Glossary

Leasing

The following graphic reflects the relationship between a landowner, recipient/subrecipient, and program participant under a lease.

Graphic: Text box: Recipient or Subrecipient, Arrow: Lease (Left-Right), Text Box: Landowner. Text box: Recipient or Subrecipient, Arrow: Sublease or Occupancy Agreement (Up-Down), Text Box: Recipient or Subrecipient

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Did you know? In projects that provide Sponsor-Based Rental Assistance, assistance is provided via a contract between the recipient or subrecipient and the sponsor agency. The lease is between the sponsor and the landlord and there is a sublease between the sponsor and the program participant. (§ 578.51(d))

How should a lease be structured in a project with rental assistance?

For projects that provide tenant-based and project-based rental assistance, the lease is between the program participant and the landowner (§ 578.51(e)). A contract exists between the recipient or subrecipient and the landowner.

  • In PSH and Rapid Re-housing (RRH) projects, the lease must be for a term of at least one year and automatically renew upon expiration (§ 578.51(l)(1)).
  • In Transitional Housing projects, the lease must be for a term of at least one month and automatically renewable upon expiration (for a maximum term of 24 months) (§ 578.51(l)(2)).

Tenant-Based and Project-Based Rental Assistance

The following graphic reflects the relationship between a landowner, recipient/subrecipient, and program participant within tenant based and project based rental assistance.

Text Box: Recipient or Subrecipient, Dotted Line, Text Box: Contact, Dotted Line, Text Box: Landowner, Arrow (Left-Right): Lease, Text Box: Landowner