Property
Understanding 25-year FRI leases in specialist supported living
What full repairing and insuring (FRI) typically means for long-lease SSH stock — and which questions solicitors and investors should insist on answering.
Bhenito Research · · 10 min read
Long leases in specialist supported living (SSH) are often described as “25-year FRI” — full repairing and insuring. The phrase is useful shorthand. It is not a substitute for the executed lease. Term length, repairing obligations, insurance duties, rent review mechanics and break rights vary by document and counterparty.
FRI commonly means the tenant (or lease counterparty) carries responsibility for repairs and insurance of the demised premises, subject to the lease schedule. Investors sometimes hear FRI as “passive income with no landlord obligations.” In practice, residual landlord duties, reserved rights, service charge regimes, structural exclusions and enforcement practicality all matter. Diligence is about who pays for what when something fails — not the marketing label.
Twenty-five years is a typical marketing term length, not a universal constant. Confirm commencement, expiry, any options to renew, and whether the remaining term at purchase still matches the investment thesis. A lease with fifteen years remaining is a different liquidity and refinance proposition than one newly granted.
Covenant quality sits beside lease wording. Registered providers, care operators and housing counterparties differ in credit standing, operational capacity and regulatory exposure. A robust FRI lease with a weak counterparty is not the same product as a carefully worded lease with a resilient covenant — and neither removes the need for independent legal review.
For solicitors and family offices, a practical enquiry list includes: repairing schedules and exclusions; insurance covenants and reinstatement; alienation and consent; rent review formula (including CPI, caps and floors); default and forfeiture; and any collateral agreements. Bhenito’s SSH diligence checklist and Knowledge Centre are starting points — not a legal opinion.
This note is educational. It does not interpret any specific lease, guarantee income or constitute regulated advice. Instruct independent solicitors before relying on FRI framing in an investment decision.
Investments carry risk. Returns are not guaranteed. Past performance is not a reliable indicator of future results. Figures shown are indicative and subject to due diligence. Prospective investors should obtain independent financial, legal and tax advice before making investment decisions.