The Portfolio:
- 11 fiber conduit leases
- 25 encroachment permits
- Underground conduit system covering 10 blocks
The Challenge: The Seller built an underground conduit system and operated it for over 25 years. Now the Seller wished to sell her company that owned the conduit system, the leases and the encroachment permits and retire. The Seller did not have a current detailed survey of the system and the fiber lines installed within it. The Buyer required such a survey prior to closing. In addition, the Buyer was concerned about the property tax ramifications of owning the system.
The Solution: We coordinated with the Buyer and Seller on the preparation of the survey, which included an in-person inspection of the underground conduit. We researched the assignability of the encroachment permits as well as the leases, discovering that there were no obstacles to the assignment of both the permits and the leases. We also researched the property tax issues raised by the Buyer and were able to reassure the Buyer that no property taxes would be due for the conduit system. Although the Buyer declined to purchase the Seller’s company, we were able to structure the transaction such that the Seller divested herself of all obligations for the operation of the conduit system. We worked with counsel for both the Buyer and Seller to draft and finalize the transaction documents. We also assisted the parties with the closing of the transaction.
The Result: The Seller sold the conduit system and the lessor’s interest in 11 fiber conduit leases and assigned 25 encroachment permits to the Buyer for $2,565,527.00. The Seller has successfully retired to spend more time with her family.