Frequently Asked Questions
COMMON QUESTIONS ANSWER REGARDING NEW SITE PROPOSALS:
Is it possible to know how much a Cell Tower Company will make off my Tower?
There are many factors that are considered such as the tenant mix. Another factor is the ground rent. These items together will determine the amount of revenue generated by the Cell Tower. A specific rent does not determine the value of the tower nor what a market rate is or should be.
Why do Cell Tower Companies want such a long-term leases?
Owners of the Cell Towers want to lock in their costs for as long as possible. Prior to a landowner extending their lease it is HIGHLY RECOMMENDED that a careful examination of the cell tower’s ACTUAL value be done. It is never a good idea to extend based upon your current rents and/or increases to your current rents.
Is there a recommended length for a Cell Tower Lease?
Generally it is recommended that a length of a cell tower lease be for as short as possible. However sometimes, in order to get the best terms, you will have to negotiate longer terms regarding a new site. Each case varies and it’s best to involve a professional advocate from Cell Tower Consultants to negotiate on your behalf.
How do I know if I’m getting the fair market rent?
Cell Tower Consultants can provide an analysis of the site in order to determine this. WE HIGHLY ADVISE THAT YOU DO NOT USE “comparable rents” from other local sites, as they may be severely under market. Often times, clusters of cell towers are under market because of many factors and cell tower companies will try to use these as “comparable market rates”. Each site is like is unique and must be individually valued.
How can I get a list of current rates for cell tower leases?
Because the current market place, competing structures, zoning laws and other factors come into play there is no set list of current rates as it is always changing.
What is the current rate for a new cell tower lease?
An analysis of the current market place and competing local sites must be done to determine this. Contact Cell Tower Consultants for a professional analysis.
Do you have any advice on negotiating a cell tower lease?
The biggest mistake most landowners make is to try and negotiate on their own out of fear of losing their site or thinking they know how to. So many factors come into play and things change all the time. Leases are negotiable and contain many items that the tower company will gladly remove if pressed. Cell Tower Consultants are skilled in negotiations and will be YOUR advocate.
How will a Cell Tower impact my properties value?
In most cases, cell towers increase property values. It is HIGHLY RECOMMENDED to structure your lease(s) to maximize your values. Poorly structured leases will devalue property values.
Do I need to be concerned about Radio Frequency Radiation?
No studies currently show any danger of having a cell tower or site on your property. Therefore it is difficult to determine if there should be any concern.
What happens if the Tower owner moves?
The Cell Tower Lease dictates what happens to the tower should the tower owner move. It is important to get these items included in the lease upfront.
What happens if the Tower owner goes bankrupt?
If the tower owner should go bankrupt, most likely, they asset would be purchased by another cell tower operator.
Is there anything special I need to know about Tax and Insurance issues?
These are all negotiable items in your lease. Cell Tower Consultants can assist you understanding the ins and outs of these items.
Is there a rule as to how big a Cell Tower needs to be? How much space do Cell Towers need?
It depends upon the lay of the land and the market place. These items need to be accounted for in your lease.
How much more money is available for giving additional space?
This varies. The current tenants, current market, how much space and what do they want to do with this space are all elements that contribute to the additional money available. This can be a great opportunity to recover lost rents from a poorly structured lease.
Is it possible to get compensated for additional tenants on the tower?
There is a possibility to negotiate this into your lease. However, cell tower owners often times flat line their costs thereby giving themselves a greater chase for upside growth.
Should I give a perpetual easement or term easement?
This is VERY negotiable and Cell Tower Consultants are experts in this area. A good rule of thumb is to never assume ANY item is set in stone on a lease agreement or buyout agreement. We can help you to understand what you can and cannot change. They will always tell you they cannot change an item when it actually can and usually does get changed.
How does an easement affect the property in the long-term?
There are many items of ingress/egress easement, which should be weighed carefully. Cell Tower Consultants will work with you to help understand and negotiate each of these items. There can be an adverse affect if not negotiated properly.
What do I need to do long-term with regard to my cell tower lease?
Your capital needs versus your risk factors are important in regard to your site. Cell tower lease revenue is difficult to replace. However, MANY leases get cancelled – the most common mistake for landowners is to “ASSUME” their lease is backed by the US Government and is will last as long as the term on the lease. 99% of all leases can be cancelled in 30-days.
Why are the cell tower companies constantly trying to buyout my ground lease?
Crown Castle, SBA and American Tower are large publicly companies who need to protect their assets and improve their EPS by turning your rent expense into a capitalized asset on their balance sheets. You will be told many different “stories” in order to get you to do what they want. It is not uncommon for some less than ethical sales reps to “bend” the truth, or even threaten you to get you to sign their extension or buyout agreement. As skilled negotiators Cell Tower Consults will be your advocate.
What are the reasons cell tower companies try to extend my lease?
There first approach is to get you to sell your lease to them. If this does not work they will always want you to extend at their benefit to lock your cost in. It is rarely to your benefit to extend and almost always results in you losing a tremendous increase in value for a small payoff of a few thousand dollars to extend for decades.
Questions regarding 3rd party aggregates (buyout companies):
You may be getting inundated with calls to sell your lease – this does not mean you are safe and/or sitting on a ton of money. It’s likely your site is in a national database, which many “dialing for dollars” reps have. They are strictly going down a list of sites looking for people who want to sell their lease. These people make money only on buying a revenue stream. They do not have the ability to “market” your site for additional revenue and will make money only if you sellout.
Who is Tristar?
Tristar is a company that buys out American Tower sites. In the past they bought out Crown Castle sites. Often times, their offer(s) seem appealing but need careful consideration before entering into. In many cases, there are alternatives to this type of proposal. Cell Tower Consultants have a wealth of knowledge in this area and will help you to understand.
Does Tristar deliver on their promise of revenue sharing?
Landowners must be very careful before entering into ANY agreement with any company as there are no guarantees in most all revenue sharing offers.
What risks are associated with a Tristar deal?
There are always risks associated with these types of offers. As in most cases, the more risks there are, the more reward there is. A landowner should work with Cell Tower Consultants to weigh the risk/rewards carefully before signing any agreement.
Can Unison Site Management bring additional tenants to my site?
In very limited cases, additional revenue can be had. It is important to work with Cell Tower Consultants understand what they are really offering and what guarantees in writing they are giving. It’s important to note that no third party buyout company can bring any additional tenants that a landowner cannot do own their own.
How do I know I am getting the best price on a lease buyout?
The public does not readily know market price and comparables. Cell Tower Consultants can help. When Landowner negotiates a lease buyout without assistance, there are not favorable outcomes more often than not. Each Cell Tower Sites are individual assets, which carry different “actual” values. Selling a lease based on the rents alone, is not wise, which in most cases will be a costly error.
Why are all these companies calling me to buyout my cell tower lease?
It’s a numbers game, is all about money. They are calling as many owners as possible to find people who want to sell their lease. The number of people calling you has zero to do with the value of your cell tower lease. These people specialize in buying cell tower lease revenue streams, which you happen to be holding.
What are the risks of losing my cell tower lease if I do not sellout?
The top risks are obsolescence through mergers and acquisitions. There are also risks associated with micro cell towers and newer technologies such as Lightradio Technology.
Can I get compensated for a fiber run or a 4G upgrade?
In many cases, the tower company has violated your existing lease by running fiber without your permission. Depending upon your lease, you can get compensated for a fiber run.
How does Lightradio technology affect my cell tower lease?
This is a newer technology, which is just now coming to play. This allows for a much smaller footprint to place a cellular site. This will eliminate many cell sites in the future.
What is a micro cell tower?
Micro Cell Towers are rapidly coming into play to enhance and replace existing cell site locations. They have limited coverage but provide coverage in area, which usually have had poor coverage in the past.
What happens to my cell tower lease if there is a merger?
There are winners and losers when a merger happens. Some sites will get enhanced while others will be eliminated. There are always risks associated with owning a cell tower lease.