Benefits of Cell Tower Leasing

An Explanation of Cell Tower Leasing When property owners lease their land to cell phone companies where they can place cell phone

towers, they receive a cell site lease payment for that land. A number of factors come into play in

determining how much money the land owner will receive for their lease, including the location,

the size of the company the lease is with and the negotiating skills of their representatives. A cell

tower lease can provide the property owner with a significant income for a long period of time.

Some people or businesses own multiple cell site leases.om

Drawbacks to Retaining Ownership of the Lease While there is potential for making a great deal of money from a tower lease, it is important to

realize that the cell phone company is more interested in making money for itself. Once the lease

is put into place, the negotiations do not end. Companies often continue to ask for changes that

could leave the property owner with a lower value piece of property or with lower cell site lease

rent payments. An existing lease can be an extremely valuable agreement. However, when the

cell phone company makes a request for any type of change, it is important for the owner to

understand what the repercussions may be.

Changes that the cell phone company may request but which should be avoided by the land

owner include:

● Extending the terms of the lease – When it is time for the lease to be renewed, the land owner

has the opportunity to increase the amount of rent they receive, whereas simply extending the

current terms does not.

● Addition of amendments to the original lease – While those amendments that only allow for

the updating of antennas and towers will increase the value of the lease, others can result in

lowering the property value. This means that the land owner will not be able to get the full

value for their land if they sell it.

● Sometimes the parent cell phone company wants to sublease their tower that is on the land

owner’s property, to increase their own profits. The land owner should not allow this type of

agreement to take place, since any additional revenue that is generated from the rental should

come to them.

● Any amendment that gives the cell phone company the power to make changes or expand its

use without specifying what they are doing should be denied. Upgrades to the tower should

result in a rent increase for the land owner.

● The land owner should never agree to a reduction in their rent based on any reason they are

given by the cell phone company.

When Selling a Cell Tower Lease May Be a Good Idea Although a lease can bring in a steady flow of significant income, there are times that the cell

site lease owner may simply be in need of capital. Selling the lease will provide them with an

untapped, lump sum of capital that they can use in any way they want or need, from paying down

debt to reinvesting in other investment options. For others, the complications that threaten the

value of their lease may lead to the desire to sell. Threats of rent reduction are common, and

mergers and acquisitions have frequently led to the elimination of redundant cell sites.

When selling a cell tower lease, the support of a company like Wireless Capital Partners can

mean the difference in getting the results that work best for the individual. Lease owners differ

in their needs for short-term or long-term sales. Lease holders have the option to sell their leases

for ten years, before having them returned, or for 99 years, in order to get the greatest value from

the transaction.