AT&T completes structured transaction of underutilized central office facilities

CHICAGO, Feb. 5, 2025 – JLL announced today that it has closed a structured transaction of a 74-property portfolio owned by AT&T, totaling over 13 million square feet. The transaction was completed with real estate development firm Reign Capital for the structured sale-leaseback of underutilized central office facilities, located across 23 states, generating more than $850 million in cash proceeds for AT&T.

JLL helped AT&T assess their real estate portfolio, identifying opportunities to unlock the value of underutilized central offices. Through a pioneering transaction structure, JLL represented AT&T in the sale and leaseback of the properties, and Reign Capital purchased the assets. The unique transaction structure provides AT&T exclusive operational control and protection of critical network infrastructure to safeguard the functionality of their network services. The deal also includes provisions for financial participation for AT&T to share in revenue generated through redevelopment of these properties.

Central offices were originally built to house and connect large, bulky and energy-intensive equipment for outdated copper networks. As customers move from copper to fiber and wireless, a smaller, more efficient equipment footprint is managing AT&T’s network. This technology evolution not only reduces power consumption, benefitting the environment, but also lowers operating costs and frees up valuable real estate for other uses.

“The uniquely structured deal unlocks value in otherwise stranded commercial real estate space,” said Michael Ford, Senior Vice President of Global Real Estate and Security at AT&T. “It’s a creative solution providing both upfront and long-term value through a revenue sharing model that fits with our broader company transformation initiatives.”  

By leasing back only the space that is needed, AT&T is streamlining its real estate footprint. AT&T will make lease payments to Reign Capital for the duration of the lease term and maintain exclusive operational control of space required for access to communications infrastructure in each location. This transaction involves only a small portion of AT&T’s portfolio of central offices and has no impact on jobs or changes in customer products and services.

The complex deal involved teams across JLL, including Integrated Portfolio Solutions, Capital Markets, Consulting, Value and Risk Advisory and Work Dynamics.

“The intersection of telecom innovation and real estate is creating a new landscape of possibilities,” said Lisa Vollmer, Executive Director and Head of JLL’s Telecommunications Division. “Companies are reimagining their property portfolios to support next-generation network infrastructure, driving a wave of specialized real estate transactions.”

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