4 Facts to Know About Cell Tower Leases


As smartphone usage continues to rise in the United States, the demand for data is estimated to go up eight times the current usage by 2018. That means many telecom carriers want to build cell phone towers more than ever. Cell tower leasing is a booming business that allows plenty of lucrative opportunities for landowners to profit from. However, many land or homeowners are unaware of the intricacies of leasing property for a cell tower. Usually, the first most landowners hear about cell tower leasing is when they get a phone call from a carrier offering rent to build a cell tower. Most people are confused about the prospects of such a deal, obviously.

If you get an offer from a company to build a cell tower on a property you own, be it a house, an apartment building or even a stadium, there are several things you should consider before saying yes to free money. Read ahead to find out.

1. The First Offer is the Worst One

Companies normally hire an agent, or a middleman, to negotiate the lease with a landowner. This agent receives a bonus if he or she can negotiate the lowest rent. Therefore, the first offer you get is never to your advantage. You can negotiate to increase the initial amount, and you really should. The lease amount will depend on the value of your property, the amount of land you offer and so on. There are many technical things that factor into negotiating cell tower leases, so it’s better that you hire an expert in the field, like Towerpoint Capital, to advise you on how to turn the tables to your benefit.

2. Cell Towers have Investment Value

Once the cell tower is built, it’s then rented out to different carriers. The more carriers there are to rent the tower, the more profitable the tower becomes. There’s obvious investment value here that should factor into a lease.

3. Rent Should Escalate into the Future

Leasing property for cell towers is a long-term investment. The cell tower is not going to pack up and leave in two years. While the cell tower will remain intact into the future, the inflation rate will not. If you agree to rent your property for a fixed rate of $1,000 a month this year, you will be at a disadvantage when the inflation rate changes the following year. Never agree to a fixed rent. Negotiate a rent escalator so your lease survives inflation.

4. Only Give Them the Land They Actually Need

Carriers will ask for more land on your property than they need so they will have more to control. Do your research and find out how much land that is actually required for the tower. Negotiate the rent for the minimum required area. If the carrier wants more land, the rent should be accordingly higher.

More often than not, landowners are shortchanged in the cell tower leasing process due to lack of information. A cell tower will generate great returns for a carrier for decades on end. Keep that in mind and negotiate the lease smartly.



Image Source: https://commons.wikimedia.org/wiki/File:Cell-Tower.jpg