After several years of working with landowners to lease portions of their land for some of the largest wind and solar projects constructed throughout the United States, the founders of the Madison Street Renewables (“MSR”) noticed an ongoing trend in nearly every project where several of each projects’  landowners strongly desired to receive a large amount or all of their compensation earlier in the lease term which was inconsistent with the project owners’ unwillingness and/or inability to waiver for the industry standard of paying the landowners in several small installments throughout the term of the lease.

While the landowners’ reasoning for desiring different payment timelines varied (e.g. some farmers determined that they could ultimately make more income then the guaranteed rent to be paid over 30 years if they could just receive a fraction of that total amount now in order to buy new farm equipment, others merely wanted to cure existing mortgage defaults to prevent their banks from foreclosing on their of land that was their core of their business, etc.), the lesson learned is that the project owners have made it clear they will not budge on this issue since they’ve continuously rejected the landowners’ unsolicited offers to lease their land for a total amount significantly less (provided they were paid sooner)  than the total amounts being offered by the project owners.

So if the project owners are willing to forfeit a chance to pay significantly less rent and therefore the landowner doesn’t get the rent money when they can put it to the best use it creates a situation where neither party is able to receive all the potential benefits of the transaction.

Watching this scenario continue to occur became the genesis for creating MSR. In other words, MSR has determined that it can prevent this significant value from being left on the table by bridging the gap between the Project Owners’ need to make installment payments over long periods of time and Landowners’ need to receive immediate compensation for their lease by agreeing to pay the landowner a (discounted) lump sum payment now in return for the Landowner assigning/redirecting all future rents from the project owner to MSR.