Which party typically holds the reversionary interest in a lease?

In the context of a lease, the reversionary interest refers to the right of a party to regain possession of a property once a lease term has ended. This interest is typically held by the landlord. The landlord, as the property owner, retains the rights to the premises throughout the duration of the lease and expects to regain full control of the property once the lease concludes.

The concept of reversionary interest originates from property law, where it is essential for landlords to know they have a vested right to their property after a lease termination, allowing them to lease it to a new tenant or use it for their purposes. Upon the expiration of a lease agreement, the tenant's rights to possess the property cease, and the landlord’s reversionary interest allows for the recovery and subsequent use of the property.

This connection clarifies why the landlord is recognized as the party with the reversionary interest while the tenant, mortgagee, and lender do not hold such an interest in this context. The tenant, for example, has a leasehold interest during the term of the lease but does not retain rights beyond its expiration. Similarly, a mortgagee or lender may have interests related to the property, particularly in terms of financial obligations, but they do