(Reuters) -AT&T said on Friday it has secured $850 million through the sale-leaseback of its underused central office facilities that house its legacy copper networks to real estate development firm Reign Capital.
The U.S. telecom major is planning to exit a majority of its copper network operations by 2029 as customers shift to newer technologies such as fiber optics and wireless networks, which offer superior speed and reliability and require a smaller space to operate.
Sale-leaseback is a financing option in which a company sells part of its assets to raise capital and leases back the same property to run its operations.
AT&T (NYSE:T) will lease back only the space required for its network operations.
"The uniquely structured deal unlocks value in otherwise stranded commercial real estate space," said Michael Ford, head of global real estate at AT&T.
The transaction, which closed in early January, includes asset transfer of 74 properties across the country, affecting only a small portion of AT&T's portfolio of central offices and has no impact on jobs or changes in the services, the company said.
The Dallas, Texas-based company's shares rose 0.7% in early trading.