Investment
Long ground lease: earning from family land without selling it
Many Douala families own a well-placed plot in Akwa or Bonanjo, without the means to build on it and without wanting to sell. A long ground lease, the bail emphytéotique, lets them hand it to an investor for several decades while remaining the owners.
How it works
The owner leases the land for a very long period: more than eighteen years and up to ninety-nine. The tenant, called the emphyteutic lessee, builds and operates. They pay an annual rent, often modest compared with the value of the land, sometimes with a payment on signing.
At the end of the lease, unless the contract says otherwise, the buildings go to the owner without compensation. The family gets back land with buildings on it.
Why investors like it
The lease gives the tenant a property right in the land, not just a rental. That right can be mortgaged, so the tenant can borrow to build, and it can be transferred. For an investor, Cameroonian or foreign, it means security over several decades without having to buy the land.
What has to be in place
- A clean title. The land must be titled in the names of those who sign. If the owner has died, the transfer after death comes first.
- The agreement of every owner. Only those who could sell the land can grant a long ground lease on it. Under joint ownership, that means every heir.
- A notarial deed registered on the title. Because the lease creates a property right, it must be signed before a notary and registered at the Land Registry to bind everyone.
- Registration duties to work out. They are calculated on the total rent due over the lease. Work them out with the notary before setting the rent and the term.
What gets negotiated
The term, the rent and how it is reviewed, the upfront payment, the type of buildings allowed, maintenance, what happens if the tenant doesn’t build on time, and what becomes of the buildings at the end. A well-drafted lease settles all of this from the start. A vague one means thirty years of disputes.
What we do
We get the land ready before looking for an investor: the title checked and brought up to date, the family’s written agreement, the value of the land and a realistic rent. Then we present the project to investors and support the negotiation through to signing at the notary’s office.
Family land you want to put to work? Send us the location, the area and a photo of the title. We’ll tell you whether a long ground lease is realistic and what it could earn.
This article gives general information. It does not replace advice from a notary or a lawyer on your own file.
Manfred Gabriel Njoh
Founder of Henser Group, consultant in Douala since 2011. He follows each file himself, from the first visit to signing at the notary’s office.
