Following the passing of a prominent real estate entrepreneur, an extensive property portfolio valued in the mid-eight figures passed to an undivided community of three heirs. Two siblings intended to preserve and energetically modernize their father’s life work. The third heir, facing pressing private financial liabilities from failed outside investments, demanded an immediate cash liquidation of his one-third share and filed a formal estate division lawsuit (Erbteilungsklage), threatening a court-ordered public auction of all assets. The continuing siblings lacked the liquidity for a cash settlement, the bank refused to increase existing mortgages due to strict regulatory affordability caps, and a forced sale would have triggered heavy progressive Zurich real estate capital gains taxes.

FiPAX resolved the deadlock by synchronizing civil property law, cantonal tax statutes, and private capital structuring: instead of liquidating real estate, FiPAX drafted a partial estate division agreement. By strategically invoking the statutory tax deferral provisions under Section 216 of the Zurich Tax Act (StG ZH), the properties were transferred undivided to the continuing heirs without triggering a single franc of real estate capital gains tax.

To settle with the departing brother fairly and without delay, FiPAX developed a hybrid financing solution: unencumbered mortgage notes on prime assets were reissued as collateral for a private family bond. Through the FiPAX investor network, a private bridge facility was arranged, allowing the indebted heir to settle with his personal creditors that same day. The remaining settlement balance was restructured into a ten-year, fixed-interest family loan serviced directly from property rental yields, allowing the continuing heirs to deduct the interest payments entirely as debt service on their income tax returns.

The entire portfolio remained in family hands, the public auction was averted, and millions in potential tax charges were prevented. Discretion was paramount: resolving high-stakes family inheritance disputes and private debt issues requires absolute confidentiality.

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