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                                                                     Exhibit 5.1


               [LETTERHEAD OF CLIFFORD CHANCE ROGERS & WELLS LLP]


May 15, 2002

iStar Financial Inc.
1114 Avenue of the Americas, 27th Floor
New York, New York 10036

Dear Sirs:

         We have acted as counsel to iStar Financial Inc. (the "Company") in
connection with the offer and sale by SOFI-IV SMT Holdings, L.L.C. (the "Selling
Stockholder"), of 10,000,000 shares of common stock, par value $.001 per share,
of the Company (the "Securities"). The Securities are being sold pursuant to
Company's registration statement on Form S-3, file number 333-32946 (the
"Registration Statement") and are being offered by a Prospectus dated December
31, 2001 and a Prospectus Supplement dated May 15, 2002 (together, the "Final
Prospectus").

         Based on the foregoing, and such other examination of law and fact as
we have deemed necessary, we are of the opinion that:

                  1. The Securities have been duly authorized and validly issued
and are fully paid and non-assessable; and none of the Securities was issued in
violation of preemptive or other similar rights of any securityholder of the
Company.

         We consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us under the caption "Legal
Matters" in the Final Prospectus which is a part of the Registration Statement.

                                      Very truly yours,


                                      /s/  Clifford Chance Rogers & Wells LLP