<Page> EXHIBIT 5.1 LETTERHEAD OF CLIFFORD CHANCE US LLP March 14, 2003 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., a Maryland corporation (the "Company"), in connection with the offer and sale by the Company of $150 million aggregate principal amount of its 7.0% Senior Notes due 2008 (the "Securities"). The Securities are being sold pursuant to iStar Financial's Registration Statement on Form S-3 (numbers 333-83646) under the Securities Act of 1933, as amended (the "Registration Statements"). Based on the foregoing, and such other examination of law and fact as we have deemed necessary, we are of the opinion that the Securities have been duly authorized by the Company and, when issued and sold in the manner contemplated by the prospectus supplement for the offering of the Securities dated March 11, 2003, the Securities will be legal, valid and binding obligations 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 prospectus which is a part of the Registration Statement. Very truly yours, /s/ CLIFFORD CHANCE US LLP