The Portfolio:
- 2 telecommunication leases with antennas mounted on stealth mono-trees and underground equipment vaults located in the backyard of residential property.
The Challenge: The Seller had opened escrow to sell the property while retaining the rights to the telecommunication leases. He wanted to close on the telecommunications transaction prior to closing on the sale of the property. Two loans were secured by the property and a judgment against the Seller was recorded against the property. The Seller wanted to apply the proceeds from the transaction, along with the proceeds from the sale of the property, to pay off the loans and the judgment debt. One of the telecommunications leases provided a right of first refusal (“ROFR”) for the carrier.
The Solution: We immediately assisted the Seller to provide notice of the offer to the carrier in order to start the time clock on the ROFR option. We commenced our due diligence process, ordering a title commitment and an environmental report; we performed the site visit ourselves. We oversaw the preparation of a survey for the exact area of the property containing the cell site premises. We worked with the Seller’s lender and the title company to obtain pay-off demands for the loans and the judgment debt, and we coordinated with the Seller’s escrow officer to have these paid off upon the close of the escrow for the sale of the property. We drafted the transaction documents and worked with the Seller and the Buyer’s legal counsel to finalize them. The Buyer was concerned about closing prior to having the loans and the judgment paid off. We collaborated with all parties to reach a solution, which was to leave the purchase proceeds in escrow and have the Seller execute a termination of the easement that the Buyer could record if necessary; the escrow company was instructed to release the funds to the Seller’s residential escrow company for that closing, but return the funds to the Buyer if that escrow could not close within a week.
The Result: The Seller sold to the Buyer 2 telecommunications lease and granted an exclusive telecommunications easement over the portion of the property containing the leasehold premises for a total price of $1,557,536.00. The Seller’s escrow for the sale of the property closed as anticipated and the secured loans and judgment were paid off. The Buyer was able to obtain title insurance for the easement fee of all liens and encumbrances.