A diverse set of hydroxy-benzo[e]iodadioxaphosphinine oxides and derived diaryl iodonium salts are prepared and two examples are characterized by X-ray crystallography, featuring an out-of-plane geometry of the hypervalent bond for both compound classes. Treatment of the phosphate-stabilized diaryliodonium salts with Ca(OH)2 results in an efficient base-induced intramolecular aryl migration under aqueous conditions, yielding iodo-substituted diaryl ethers with yields up to 94%. Our findings highlight the synthetic potential of this previously underexplored compound class in organic transformations.