--- title: Lease Company (Co.) Definition | Real Estate Glossary description: Lease Co. is a legal entity established to operate as a master tenant under a Delaware Statutory Trust (DST) ownership structure. image: https://www.realized1031.com/hubfs/social-suggested-images/Realized_Glossary_Graphic-3.jpg --- [![Realized 1031 Exchange Marketplace](https://www.realized1031.com/hs-fs/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black.png?width=240&height=80&name=Realized-Logo-Black.png "Realized 1031 Logo") ](https://www.realized1031.com/) - Better Business Bureau Rating: **A+** - [FINRA BrokerCheck](https://brokercheck.finra.org/firm/summary/22333) - [Call](tel:1-877-797-1031) **(877) 797-1031** # Lease Co. Lease Co. is a legal entity established to operate as a [master tenant](https://www.realized1031.com/glossary/master-tenant) under a [Delaware Statutory Trust (DST)](https://www.realized1031.com/glossary/delaware-statutory-trust-dst) ownership structure. The IRS requires DSTs to act as completely passive investment vehicles when used for [like-kind exchanges](https://www.realized1031.com/glossary/1031-exchange), and does not allow the Trustee of the DST to enter or participate in any leasing activity. Thus, the Lease Co., as an entity legally distinct from the Trustee, leases the entire property and operates the property through sub-leases with the property’s tenants. The Lease Co. is typically controlled by the [sponsor](https://www.realized1031.com/glossary/sponsor). For instance, assume a DST owns a multi-tenant retail center. The DST will lease the entire property to the Lease Co., which will in turn operate the property and handle any leasing to sub-tenants. The Lease Co., makes rental payments to the DST, which then pays out to investors based on their proportionate ownership in the DST. Download The Guide To DSTs [![The Investor's Guidebook To DSTs](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/DST-eBook-250.png?width=250&height=250&name=DST-eBook-250.png "See if Delaware Statutory ...") ](https://www.realized1031.com/glossary/lease-co#blogform) Download eBook ---   --- ### The Investor's Guidebook To DSTs ![Download The Guide To DSTs](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/DST-eBook-550.jpg?width=550&height=650&name=DST-eBook-550.jpg) See if Delaware Statutory Trusts are right for you. By providing your email and phone number, you are opting to receive communications from Realized. If you receive a text message and choose to stop receiving further messages, reply STOP to immediately unsubscribe. Msg & Data rates may apply. To manage receiving emails from Realized visit the Manage Preferences link in any email received. 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Thus, the Lease Co., as an entity legally distinct from the Trustee, leases the entire property and operates the property through sub-leases with the property’s tenants. The Lease Co. is typically controlled by the sponsor. For instance, assume a DST owns a multi-tenant retail center. The DST will lease the entire property to the Lease Co., which will in turn operate the property and handle any leasing to sub-tenants. The Lease Co., makes rental payments to the DST, which then pays out to investors based on their proportionate ownership in the DST.", "author" : { "@type" : "Organization", "email" : "marketing@realized1031.com", "name" : "The Realized Team", "url" : "https://www.realized1031.com/blog/author/the-realized-team" }, "dateModified" : "2022-07-18T16:13:38+0000", "datePublished" : "2022-07-18T16:13:38+0000", "description" : "Lease Co. is a legal entity established to operate as a master tenant under a Delaware Statutory Trust (DST) ownership structure. 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