Similar setups exist for fraternities and sororities. They lease university land for a token amount but own the house that's built on it. In some cases, the university even gives loan guarantees for the mortgage on the house. This makes Greek organizations more financially viable than they otherwise would be and desirable locations near or on campus. In exchange, the university has incredible amount of leverage over the Greek organizations to ensure their compliance with university rules. Of course, some schools are quite lax on this but when something rises to the level of legal proceedings, the university can move swiftly in banning the organization from campus.