The Portfolio:
- Dual lattice towers on single parcel with 2 equipment buildings
- 7 leases – 2 with governmental agencies; 4 television broadcasting stations; 1 private company providing telecommunication services to the air transport industry
The Challenge: The Seller inherited the property and the company that owned and operated the towers and leases from his parents, but title had not yet been perfected. He wanted to sell the entire portfolio and free himself from the obligations of ownership. He also wanted to use a portion of the proceeds for a Section 1031 like-kind exchange. The lease with Homeland Security required the consent of the lessor for its assignment, predicated on the assignee’s qualifying as an approved vendor under federal law. The Buyer required clarification as to the number of renewal options on one of the broadcasting station’s leases. The Buyer refused to take title to the property underlying the towers.
The Solution: We worked with the Seller’s counsel to ensure that he had the proper title to the assets for the transaction and arranged for the deeds to be recorded by the escrow company at closing. We also prepared an amendment to the broadcasting lease specifying the renewal terms. We coordinated with the Seller to gather documentation and information regarding the towers and leases, including having photos taken of the interiors of the equipment buildings andobtaining an environmental report and a site visit report. We worked with the Seller and the Buyer’s legal team to draft and finalize the transaction documents. In order to allow the transaction to close as soon as possible, we arranged for separate escrows for the Homeland Security lease and the broadcasting lease being amended. To resolve the issue of the Buyer’s refusal to take title to the property, we agreed to take title to it ourselves and to assume the obligations of ownership. We coordinated with the escrow company on the simultaneous closing of the several escrows and the order of recording the deeds and easement.
The Result: The Seller sold the leases and granted an exclusive telecommunications easement over the property to the Buyer for a total of $3,008,664.00. The transaction closed with 3 separate escrows – the main escrow, a second escrow for the broadcasting lease and a third escrow for the Homeland Security lease. We took title to the parcel and assumed ownership of the towers and equipment buildings. The Seller was able to divest himself of all ownership obligations.