8/31/15 Another Dire Warning Re Inflation: Fixed Rates (Cell tower Leases)

It’s Monday and the markets are again worried about the uncertainty about the world ‘s economy and the extreme inflation suppression that has gone on for 2o years. Will it explode? Will the feds HAVE  to raise interest rates? The markets do not like the unknown and often react violently.

http://www.businessinsider.com/us-futures-august-30-2015-2015-8

“Posted on 8/30/2015, 9:00:45 PM by blam
Sam Ro
August 30,2015
US futures are trading in the red, signaling more volatility for the US stock markets when they open on Monday
Dow futures are down 177 points, S&P futures are down 22 points, and Nasdaq futures are down 46 points.
This follows what’s being interpreted as hawkish comments from Stanley Fischer, Vice Chairman of the Federal Reserve.
“Given the apparent stability of inflation expectations, there is good reason to believe that inflation will move higher as the forces holding down inflation dissipate further,” Fischer said on Saturday during a panel at the Kansas City Fed’s Economic Symposium in Jackson Hole, Wyoming.”

Fixed rate investments, even ones that adjust yearly in an attempt to keep up with inflation, act in reverse to interest rates.

 

History has proven over and over again that ‘down is faster;. All things are affected by gravity, even economics. All bubbles eventually burst.

Andrew G Kellerman has a unique financial background: real estate, mortgages, securities, US and corporate bonds, options, and insurance. that gives him an understanding of cell tower/rooftop leases that few consultants can match.

He can be contacted at 760) 470-1782 of reached by email at Andrew@1st-CellTowerBroker.com

 

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Fixed Rate Investments: Cell Site Leases Could Get Pummeled!!!

Aug 24, 2015

As I awoke this morning the Dow futures were down 1,000 points. This is not a real big deal yet, but may portend the great collapse that many doomsayers have been predicting for years. I believe that someday all markets tend to find their true value, devoid of hype, over optimism and sheer greed.

An hour after the markets opened the vacuum had subsided. The reaction seems to be the worldwide financial pessimist realization that China IS REALLY in trouble due to major slowdowns in exports, a housing bust due to extreme overbuilding and the ensuing panic the US experienced just a decade ago.

Greece maybe ejected from the European Union, Spain, The UK all suffering pain and pessimism is growing. The financial markets don’t like the unknown. Fear, when born is the harbinger of PANIC.

How will this affect interest rates and fixed rate investments like cell tower leases? My take is that interest rates will rapidly rise and this will affect the fixed rate cell site leases as these are fixed rates (adjusted minimally by contract escalations). As interest rates rise, fixed rate securities will go down. It is just not the mathematical recalculations that may make these a losing proposition, but markets (investors) do not like the unknown and may choose to sit this one out.

Andrew G. Kellerman’s financial experience includes: stocks, bonds, commodities, insurance, options, real estate, mortgages, cell tower lease sales and telecom financial consultant dealing with many Fortune 500 companies.

1st-CellTowerBroker.com, Inc. Initial consultation is free and can save or make you lot of money by helping you make the right decision. 760-470-1782 or Email

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Cell Tower Lease: Sell, Joint Venture or Refinance

Cell Tower Lease: Cash It In or?

There are several ways of turning your cell tower or rooftop lease into cash without giving up title. Just like any other real estate you can opt to sell your lease, joint venture your lease or just recently, the option to refinance your lease is now possible.

This gives you, the lessor, more alternatives than you’ve ever had to get the cash you need, when you need it no matter why you need it. Let’s explore these and see if one of these are for you.

Sell Your Cell Tower Lease

For the past twenty years or so, selling a cell tower lease was the sole method of converting that cash flow into a lump sum. Private and Wall Street buyers paid cash for the leases giving investors an income stream that was above average. There were risks that some leases would become worthless due to mergers and acquisitions of carriers, but these were discounted and the reward proved to be worth the risk.

As this set of telecom based assets has evolved the risks have achieved a downward bias and buyers are prone to paying more for the basically same assets. There are also more players that are willing to further bid up the purchase prices that are actually assignments of these leases ranging from 30 to 99 years. For these time periods the buyers get the benefit of receiving the income that is produced. They also take the risk of a partial or complete loss if a carrier or set of carriers choose to abandon or terminate a tower or rooftop.

Joint Venture Your Tower Lease

What? Yeah, sell a part ownership in your lease or sell part of the time you have remaining on your lease. Just about anything is possible, as long as it makes sense to someone who is willing to pay for the reward they could receive. Remember, you own a cash flow and that can be sold if it is discounted enough to make it possible for another to make a profit.

What I like best about the JV (joint venture) possibility is, you get to get your cake and eat it to. Sell half and keep receiving half the income. Here’s the sweet part; you have a builtin professional manager that is going to handle this lease until, forever if planned right.

When it comes a time for a renegotiation of the lease, your ‘manager’ is going to do the best they can because they have an interest (same as yours). Any other carriers your ‘manager’ can attract, the more income you will get.

AND you have a builtin buyer should you ever decide to let go of the balance of your lease.

Refinance Your Cell Tower Lease

This is new and huge. Until recently, a bank would not loan you a nickle on your cell tower lease for one good reason; it had a termination clause. this meant that the cell carrier, your lessee, could, for any reason, with as little as 30 days notice walk away from the lease.

We have discovered a source that has learned the risk/reward calculations (probably former cell tower buyers) and are willing to lend money to construct new towers, loan money to purchase a tower lease or even a group leases. They will lend up to $25M for the right project.


1st-CellTowerBroker.com, Inc. Initial consultation is free and can save or make you lot of money by helping you make the right decision. 760-470-1782 or Email

Andrew G. Kellerman’s financial experience includes: stocks, bonds, commodities, insurance, options, real estate, mortgages, cell tower lease sales and telecom financial consultant dealing with many Fortune 500 companies.

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Cell Tower Financing: Cell Tower Refinance

Cell Tower Financing is Available

We are delighted to announce that we now have financing for the cellular industry to build, buy or refinance existing telecom assets. Until recently this was only available to the major carriers, larger lease aggragators and tower builders.

Cell Tower Construction Financing

Our financial connection is not keen on spec building, but if you have a firm commitment from a major carrier or two, they want to talk. They will lend up to $25M on the right deal.

Refinance Cash Out or Leverage for More Locations

Many may wish to just refinance to get getter terms or get some cash without selling part or all of your tower lease. Always wanted to be a cellular tower mogul? Use your refinance to purchase another tower site lease.

Get a quote and explore the possibilities. Cell tower finance inquiry form.

Andrew G Kellerman’s financial background includes: Real estate, mortgages, stocks, bonds, commodities, insurance, cellular consulting and sales.

760-470-1782

 

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Cell Tower Lease Buyers: What Will They Pay?

Cell Tower Lease Values

I get the question, “What is my cell tower/rooftop lease worth”?, all the time. Problem is, there is no pat answer. Different buyers will pay different prices for different leases at different times. In other words, each lease needs to be taken apart, piece by piece.

Location of the Tower/Rooftop

A cell tower’s location is intricate in the evaluation of the lease’s value. Some older towers may have become less important to cellular phone carriers because they have filled in their coverage by buying another carrier’s cell site. They may have made a deal to locate their equipment on a competitor’s site or even purchased an entire carrier and this site, your site, may have become redundant. Whether your site is considered a necessary part of the coverage now and in the future is a fundamental of pricing when buyers bid on your cell site. What the prevailing rent is in the area paid by a carrier or its competitors is also a factor in the calculation of the value.

Remaining Term on Your Lease

Most buyers are not going to let you know that the less time you have on your tower lease, the more the lease is worth. Since most leases are sub-par when it comes to monthly rent, escalators and co-location, buyers know that historically they will be able to re-negotiate the lease. Often times they will be able to double the rent, improve the escalators and add participation in the sub-leases they may have with other carriers who house their equipment and antennae.

Rent, Escalations and Co-location Rents

Rents, escalation clauses and co-location rents are all negotiable to a point. You need to understand the importance of that cell site to the carrier(s) occupying the tower/rooftop. Some sites are more important than others. Cell site lease buyers will take this into account when bidding on a lease.

Know the Cell Tower Buyers

Remember you are dealing with companies that are in business to make a profit and their sales people get paid more if they can purchase your lease for less. Having been introduced and trained in the cellular tower business by one of the top buyers in the business, I am very familiar with the whole sales routine. I withdrew from the buyers’ side of the business and decided to put myself in the middle, helping sellers get through the many, many ploys and tactics that I thought were not upfront and transparent. Don’t get me wrong, there are some great companies out there, including the one that trained me. the problem gets back to the less that is paid for a cell tower lease, the more the sales person is paid.

I can tell you that most sales of tower and rooftop leases are under priced. And I can also tell you that there is a surefire way to make sure you get the most out of your site lease, without getting yourselves into buyout that you will pay for the next 30 to 99 years.

Using a Cell Tower Consultant

A cell tower lease adviser/consultant or even a cell tower broker will make you money. The sales people hired by cell site lease aggregators are well trained, motivated and will take advantage when they can. You need representation to get the most out of your lease.

Andrew G. Kellerman background includes: Stocks, Bonds, Insurance, Options, Commodities, Real estate sales and syndication, tower lease sales and brokering and as a Financial Adviser involving many Fortune 500 companies.

Give me a call before you negotiate! 760-470-1782 or fill out an application to get an idea of what your cell lease is worth.

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Connect to the Internet Using Your Cell Phone

Each is Becoming the Other

Last week e talked about using your cell phone to use the Internet and using your computer for verbal communications like using a phone. The functions for the devices are becoming similar and each is becoming the other. Not only does this seem to be a competitive disadvantage for each it seems to me to border on being duplicitous.

Cell Phone as Internet Router

Cellular phone manufacturers, in their fever to be everything to everyone, have now figured how to turn the cell phone into an Internet router or even a ‘hot spot’ for multiple computer connections. Using USB cables or BlueTooth, I can use my cell phone same as I would an Internet wireless router.

Hook My Cell Phone to Internet Router

I can also hook my cell phone up to my Internet wireless router to surf and download data. I’m not even going to try to explain the ‘how to’ in this article. there are many websites that can do this much better than this blogger. My only interest in this is from my prospective as a financial consultant in the cellular industry, advising those who wish to renegotiate or sell their cell tower or rooftop leases. That interest is: what’s going to happen to these leases, now and in the future.

Valuations of Cell Tower Leases

In order to stay ahead of what’s coming I need to get a sense on where the two industries (cellular vs WiFi) are headed. Here are my questions hen I look at the evolution of the relationships between computers vs cellular bring. Will the need for cell towers diminish or increase? Will cellular transmission of WiFi continue to grow? Will VOIP continue to cut into cell phone business? Or will each industry merge with each other or grow separately into to unique forms?

We haven’t got into television yet. Will we get TV over our cell phones? Be able to make calls on our TVs? That discussion is for another day.

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Cellular on Your Portable: WiFi on Your Phone

I tell my two teenagers to use WiFi (wireless fidelity) when they use their cell phones in our home when they use the internet. WiFi is normally a flat fee vs the carrier fees they use when they download data via cellular minutes.

The two methods used on our devices are becoming interchangeable to the point that our cell phones can be our computers (Internet receptions) and our computers can become our phones. You can get Internet on a cellular phone and make calls on a portable device or desktop computer.

You can use your computer to talk to friends or business associates or you can get an actual hand held phone for home or business use complete with a phone number to communicate with the world. There are a plethora of each of these programs/devices available.

Want to talk or video chat using just your computer? Yahoo Messenger or more than 80 other programs that will allow ‘phone calls’ or video and chat capabilities.

The only point is that each medium is becoming the other and they are both becoming the same.

What will this do to cell tower and cell tower lease values?

It is this telecom consultant’s opinion that in the near future WiFi will dominate the telecommunications industry for both data transmission and voice communications.

Presently the cellular industry has the coverage advantage and are very aggressive in extending their lead. Sometimes the aggressive is the enemy of the wise. In an attempt to maximize income on their cell site (rooftops or towers) they allow competition to infiltrate their bases by way of microwave equipment that can send/receive data, thus allowing WiFi competition.

Dead zones or poor reception areas are being ‘filled in’ with the advent of smaller cells instead of the looming towers. “While giant macrocell sites have been the industry norm for years, carriers are increasingly turning to a range of smaller cell site options as a way to reduce costs and speed network expansion. These include microcells, picocells and femtocells.”1/28/15 – Michael Harris – http://www.unisonsite.com/resource-center/resource.html?article=23

Coverage and cost seem to be the two keys in this battle of reception of the Internet and verbal communications. Who will be the winner? My guess is that it will be us, the public.

Now, how about security? That’s an entirely different problem. Stay tuned.

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Tower Lease Values: Record High Monthly Multiples

More Competition for Tower Leases Means Higher Prices

I get two or more new cell tower lease buyers each month asking to be put on our list for scheduled lease auctions. This is leading to higher prices for cell tower financial assets like leases rights of ways and easements. Sellers are enjoying the ride, but there is an end to the balloon. Maybe not now, but a balloon always pops.

Sometimes it is Best to Try to Re-negotiate Your Lease First

Cell hone carriers are changing their tactics as the cost of constructing new towers as expenses soar with the addition of new technology and stricter regulations are implemented. Carriers need longer commitments so they can take advantage of the growing lack of new towers that other carriers need to fill in their dead spots.

Even if you have 10 years or more left on your original lease, it is my opinion that the lease may be able to be enhanced. With a better lease, the value goes up tremendously and that’s what counts if an owner wishes to cash in. Even if selling a cell tower lease is not an option at this time, a better lease will bring more monthly revenue.

There are no promises, but I think it is worth looking at.

Andrew G Kellerman has a unique financial background in Real Estate, Mortgages and Securities that gives him an understanding of cell tower/rooftop leases that few consultants can match.

He can be contacted at 760) 470-1782 of reached by email at Andrew@1st-CellTowerBroker.com
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Cell Tower Lease Consultant: Financial Advisor

“Asking $1,000 more a month may be too much or maybe not enough…”

A cell tower lease negotiation requires a professional to represent you, the landlord, that is if you want true market rate. Every lease is different as is every cell site and a tenant’s critical need for your particular location. Asking $1,000 more a month may be too much or not enough. Cell phone carriers often make, by sub-leasing to other carriers, $10,000 or more each month, so an increase to an offer to lease your property may be peanuts to them.

You will seldom get a straight usable answer when you try and get a feel for what lease rates should be for a ‘like kind’ site, as the need for your site is not going to be disclosed. The firm that may be hired to negotiate for the cell phone carrier may not even know how important the site is to the infrastructure of that carrier’s coverage.

A schooled telecom financial advisor knows how to get to the bottom of this often perplexing conundrum and get you the best set of terms under the best and worst circumstances.

Andrew G Kellerman was trained in the telecom industry and has successfully negotiated with many Fortune 500 companies representing landlords. Whether you are negotiating a new lease or re-negotiating an existing lease, don’t go it alone.

(760) 470-1782 for a quote.

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Cell Site Leases: Want to Hear the Good or Bad News First?

Cell Phones Could Be the Next Cell Towers: Cell Tower Terminations Anyone?

You knew it was coming. Technology has a way to get to the best out of the least. That’s what capitalism is all about. Make the cell phone act as a router for other calls from other users, ‘a tower in your pocket’, so to speak. One of the largest telecom technology companies working on this concept for years is Qualcomm and they predict new cell phones with the capacity to answer and/or forward calls. The new phones will have this ability to do this with or without the without the use of a macro cell (tower or rooftop cell site).

Using long term environment technology (LTE) the phones can be used to advertise for retailers within 1,500 feet. This goes way beyond the capacity of Bluetooth, which may or even be turned on.

Hey John, we’ve got that new laptop you’ve been researching on the Internet”.

This will give the cellular companies two advantages that they do not have presently: 1. a lesser need to build new cell towers or roof top cell sites and 2. an added income source through close proximity advertising. Imagine walking past a computer store and getting a text, “Hey John, we’ve got that new laptop you’ve been researching on the Internet”.

Now the Good News: More New Carriers on Fewer Towers: Co-Location

The cost of installing new cell towers has priced itself towards the end of oblivion. Between zoning, engineering and new regulations, the more efficient path to better cell coverage is to share the already existing cell sites.

This should be great news for the few cell towers that are needed to fill the remaining large areas that still exist that have enough viability to generate a substantial profit and to complete the saturation that is required to compete in this industry.

This is going to greatly improve the cash values of the cell site leases that can take advantage of future negotiations among the cell phone carriers an their landlords.

Andrew G Kellerman is a financial advisor in the telecom industry, dealing with many Fortune 500 companies. Background in stocks, bonds, commodities,and options as VP for Thomson KcKinnon Securities, with over 30+ years in all aspects of real estate and mortgages.

(760) 470-1782 Call for a quote. It could be the smartest decision you’ll ever make!

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