Does A Lease Created From An Option To Lease Enjoy The Same Priority As The Option?

In large infrastructure projects where multiple parcels of land are required to build the project, project developers will often enter into options to lease with land owners rather than entering into leases in order to enjoy flexibility and to permit time to engage in suitability studies. The developers are frequently advised to register the option to lease on title so as to give notice of its right to the land. However, the period between the registration of the option and the ultimate execution of the lease (if a developer decides to exercise the option) could last years, and it is not unusual for intervening encumbrances, including mortgages, to be registered on title during that time. Assuming the option to lease was validly registered on title, developers are left with the question as to whether or not a lease resulting from the exercise of such option to lease would have priority over subsequent encumbrances by virtue of the priority of the option itself.