cell phone tower lease

Julian Reville · 02-15-2005, 07:47 AM

Anyone have any experience with negotiating a cell phone tower lease? My mother has been contacted by a company who wants to put a tower on some land we own.

SethH · 02-15-2005, 07:52 AM

I know several people in my area who have been contacted asking them to lease out their land for a tower. The going rate around here is $2500/month for about 30 years. It's a pretty sweet deal considering you're making $30,000/year for doing nothing. Now if it is close to where they actually live I would be hesitant due to the cellular waves (yep, there's a technical term for ya!?!?). But if they own many acres of land, or if it is on a separate peice of real estate from their residence, it's a pretty good way to make some money.

Also, the $30,000/year is right in line with a deal recently struck between Sprint and some company out in CA, so I think it's a pretty standard rate unless you're in an area with very little open real estate and a high demand for cell towers.

Julian Reville · 02-15-2005, 08:28 AM

Where are you located Seth? This land is in a rural (but developing, to my dismay) area of South Carolina.

The rich folk have discovered that they can buy large tracts of land here, and they are building million dollar homes on their "estates" and "hunting preserves".

The company is offering $400 a month here, which sounds low to me, but I am ignorant about stuff like this.

Scott Merryfield · 02-15-2005, 10:08 AM

My parents best friends have a tower on their land in rural northern Michigan. I think they get around $500 per month.

I work for a major healthcare system in metro Detroit. One of our hospitals is the tallest building in the area, and we lease space on the roof for about $1,200 per month per tower.

Joe Szott · 02-15-2005, 02:26 PM

Julian,

A sneaky way to explore the rates in your area would be to ask the cell phone company for a lit of other people that have agreed to have towers on their land, to ask them how invasive it is. Once you talk to these people, why not ask them how much they get a month? Then you'll know exactly what the going rate is in your area.

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SethH · 02-15-2005, 04:38 PM

I'm located in Blacksburg, VA. It's a small town, but it's a college town, so it's got a pretty good cellular infrastructure set up. That price seems pretty low to me. The most recent example I have from here is a professor of mine who owns a piece of land Verizon wants to use. They want to put an 80 foot tower and a control box on about 1/2 acre of land and they offered $2500/month for 30 years.

Also, unless you've signed something, you could shop around to other carriers and see if they'd also be interested in the land.

Kyle McKnight · 02-15-2005, 06:42 PM

Tell 'em to throw in free cell service

Jeff Loughridge · 02-15-2005, 10:08 PM

It all depends on the area, but that sounds low to me.

How many antennas, and at what height? How many transmission lines? Who will be responsible for tower marking and maintenance, if required? If it's a monopole, that shouldn't be an issue.

Spell out clearly who has the right to lease additional space on the tower, you or the cellular company.

You might agree to that rate of they grant you exclusive rights to lease space to other tenants, and give them 10%-20% of the gross revenue.

Alternatively, you should have in the lease that you get a percentage, say 50%, of all gross revenues generated from other tenants thay they lease to.

Even though they are interested in their needs, down the road there will be another cell company, paging company, or whatever, that will want to be on that tower. Get a piece of it, too.

If they won't do either of those, try to give them non-exclusive use of the land.

Either way, there should be nothing to preclude you from doing a similar deal with another carrier, if they want to put up a tower of their own.

I wouldn't worry about RF issues. Cellular is very high freq., and relatively low level.

Julian Reville · 02-17-2005, 07:18 AM

Thanks, Jeff, that sounds like good advice. I printed it out for future reference.

KenSchmidt · 02-19-2005, 08:36 AM

While I commend the posters for their well intentioned help, using the information they have provided as the basis for your negotiations will get you the opportunity to look at the tower on your neighbors property. It is true that some cell tower leases command $2500/mo- but very few do. Asking for $2500 on the basis that one individual received it elsewhere is going to encourage the cellular provider to go elsewhere. Real quickly. Similarly with asking for 50% of all collocation revenue.

Every cell tower lease site is different and they all command different lease rates. Asking for what someone got in urban Virginia when you live in a rural area will get you nothing. How do I know? Because I negotiate these leases every day for landowners across the country.

And getting references from the cell phone company to ask for lease rates will not work. They will provide local landowners who are being paid nothing. Unfortunately, everyone believes they negotiated the best deal, but in reality few do. Asking another tower lease holder what he recieved only tells you what he recieved. It does not tell you whether or not your property has some type of unique value to the carrier. If it does than $2500/mo is possible but not likely. If the property is not unique, then the cell phone company will negotiate a better cell tower lease with your neighbor.

Lastly, wireless carriers almost never build a new tower next to an existing cell tower unless the existing tower cannot accomodate the additional loading. And all cell tower leases are exclusive by nature. No carrier will sign a non-exclusive cell tower lease- but they will sign a non-exclusive easement for access.

If you want to see more about the topic of negotiating a cell tower lease, do a google search on cell tower leases.

And if you are serious about getting the deal done right- hire an attorney or a consultant with experience with cell tower leases. And most importantly, ACT QUICKLY- the wireless carrier will move forward with the first interested party that meets their engineering criteria.

Thanks,

Ken
Steel in the Air