Douglas Ruge has extensive experience in dealing with transactions of properties occupied by tenants such as Walgreens, Rite Aid, Dollar General stores and similar tenants. Often when a Walgreens, Rite Aid, Dollar General or similar stores are sold or acquired, there is a good deal of due diligence that needs to take place. This includes purchase or construction agreements, preparation or review of leases, review of surveys and environmental reports, preparation and review of company documentation for the buyer and seller and other due diligence items.
In the case of Walgreens, Rite Aid and Dollar General stores, this information can be specific and a knowledge of their requirements and guidelines is important to successfully complete the transaction. For example, there are specific provisions found in leases for Walgreens, Rite Aid and Dollar General stores and while there is some flexibility negotiating a lease or an amendment, there are typically boundaries as well including defeasance.
Often when a Walgreens or a Rite Aid is sold it is subject to a loan that has to be defeased. Defeasance means that some of the loans cannot be paid off and have to be defeased in order to complete the transaction. Defeasance of loans involves replacing the real estate as security for the loan on properties such as Walgreens and Rite Aids.
The replacement security for real estate under the defeasance process is through government backed securities. In other words, the loan stays in place but the purchaser of the Walgreens or Rite Aid store takes the property free of the loan. Government backed securities are then purchased to replace the real estate. Through this process the Seller is effectively released in this process as payments are made from the securities allowing the transaction to be completed.
In most cases the defeasance process can become very complex and technical which is where I can help. There are many parties and documents involved and this process involves opinion letters regarding the entities and the defeasance itself. In my experience I have found that it would be difficult for an attorney without experience to adequately deal with the defeasance process and paperwork.
So, if you are involved in a transaction dealing with property defeasance, please contact me today for help. I have extensive experience is successfully handling these matters and can help guide you through this complex process.
To schedule an appointment with Doug, please click on the button below to call or email us. We look forward to discussing your legal needs in more detail and how we may be able to help you. Thank you!
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