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It's started. The cell tower bubble is starting to strain at the seams. Just 2
weeks ago, Aug 3rd, 2011, to be exact, I predicted that rising inflation and
fear of the economic outlook would drive up the yields cell tower lease
buyout firms would need to receive to stay in the game. Well everyday we
seem to get a little more bad news and none of it looks to be subsiding.
1st Cell Tower Broker arranges multiple bids for cell site leases. We
arranged a bid recently, inviting 8 buyout firms and only 3 participated in the
bidding. In the past we got closer to 100% participation. Is this an anomaly
or is it evidence that the firms are taking a more cautious look at the
market? We'll see.
Soaring gold prices have been the harbinger of fear in the markets. Gold hit
new highs today, again. Investors are nervous. Cell tower lease acquisition
firms are also getting a little nervous. Like all bubbles, prices going down are
faster than prices going up. Wake up one morning and the investments
we've learned to depend on could be seriously 'revalued'.
Risk vs reward plays the key role in any investment decision. The more risk,
the more reward is needed to attract investors. It's as simple as that. This is
especially true for tower lease purchase firms. Remember their risk is
abnormal due to the fact that virtually every lease they purchase has the
right to cancel with as little as 30 days notice.
Let me be candid. Although I'd love to have a cell tower on my property.
That said, since the cell site lease payments I would receive would be
fantastic, I'd be inclined to 'cash in'. Take my money and run. There are just
too many investments, real estate for one, that don't have termination
clauses like cell leases.
Tags: cell tower lease pricing,cell site lease pricing,cell tower site
Cell Tower Lease Bubble (part 2)
Own a cell site? Do you know what it is worth? We set record prices.