Macro Cell Network Build Out is All But Over
It’s been a great run for the private sector. There has been a lot of wealth created from those lucky enough to be the beneficiary of a cell site on their property. Very few though, had the foresight to negotiate their leases to take advantage of additional cell phone carriers being added to their sites. That is to say, they do not receive, what is termed in the industry as co-location rents (sub-leases).
Zoning and Stricter Regulations Make Site Sharing Economically Beneficial
As costs rise to build new towers, many carriers and tower companies are reconfiguring their tower structures to be able to add their competition to share their facilities. More income for the owner/carrier and less cost for the new sub-tenant make the arrangement cost effective for both.
The landowner/landlord, in most cases, does not benefit from the sharing model. Early leases and a lot of new leases do not address this added revenue that their tenant has in virtually ever site lease. The negotiation that take place between a private land owner and a Fortune 500 cellular company is not a fair fight. Most landowners are just happy to get a monthly income from what was otherwise non producing plot of land. But, there is a time and place for everything.
Time to Re-negotiate Your Lease
When it is time to re-negotiate your cell site lease is the time to address deficiencies in your lease, such as rent increases to reflect prevailing market conditions, rent escalations, and co-location rents.
Don’t get me wrong. Although you may have the upper hand in these negotiations because of the investment the carrier has made at your site and the obligations the carrier has made with other carriers, they aren’t about to be bullied. There needs to be some balance in these talks.
Andrew G Kellerman’s expertise is 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.
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