Fortunoff

IFS was engaged act as the independent fiduciary on behalf of three pension plans with respect to a warehouse property which the plans had purchased from and leased back to one of the companies pursuant to a prohibited transaction exemption issued by the U.S. Department of Labor. As independent fiduciary, we reviewed the status of the tenant company's compliance with the terms of the lease and the exemption. We engaged the services of an independent appraisal firm to appraise the property both currently and retrospectively as of the end of each year since the plans acquired it. After critically evaluating the appraisals, as well as the circumstances surrounding the plans' funding of renovation work done to the property, we determined that the tenant owed the plans underpaid rent, a return on the cost of the renovation and interest, which we collected on behalf of the plans. IFS also organized a Delaware limited liability company to hold the plans' title to the property in order to protect the plans' other assets from potential liabilities arising out of the property. We also determined that it was in the plans' interest to sell the property, and we recently completed its sale at a price well above the property's most recent appraised value.