What is My Cell Tower Lease Rate?

What’s my cell phone tower lease actually worth?

What should the rent be on a newly proposed cell site or what is the value of the cell site or cell phone tower if we are extending the lease agreement?

*** INFORMATION THE CELL TOWER REAL ESTATE MANAGER DOESN’T WANT YOU TO KNOW ***

Have you ever wondered, is my cell tower lease rate good, or is it much lower than it should be? If you answered “YES”, then DO NOT ignore this essential cell site leasing fact sheet by the industry’s best.

There is an advantage to knowing your site-specific cell tower lease rate and there is a huge disadvantage to not knowing it when going into a negotiation. Do you know if you are leaving money on the table when negotiating a cell tower lease amendment or tower lease extension? When deciding to accept a lease options offer on a newly proposed cell tower or cell site, is it worth encumbering your property without knowing the correct valuation of your lease agreement?

Wireless carriers in the USA are constantly building out and improving their networks. There are hundreds of thousands of Verizon Wireless, US Cellular, T-Mobile Sprint, and AT&T cell towers and cell sites covering the landscape. DISH Wireless will be adding at least 10,000 to 30,000 new cell sites in the next decade to catch up with their competition, and they’re coming to a city near you soon. Many wireless landlords will receive proposals this year for new rooftop cell sites, especially new ground leases next to cell phone towers, and to upgrade their sites to 5G, expand the leased area for a generator, extend the lease agreement, sell the tower rental stream income for a lump sum, reduce the rent, and possibly to consent to have their site decommissioned and leave the equipment on the rooftop in exchange for a one-time payment.

Some are for macrocell site installations and some are for small cells. Macro sites and small cells serve different purposes and have different values. Cell sites installed on rooftops and structures usually have a direct lease with the property or building owner.

Hundreds of thousands of new additional 5G antenna nodes will be deployed over the next several years in the USA as the fifth-generation wireless network is rolled out. While most will be deployed in the public right of way on top of utility poles, many will need to be installed on building rooftops. These 5G nodes and small cell sites are being installed on building rooftops, church steeples, municipal water tanks, and free-standing towers.

The cell sites installed on monopoles, lattice, or guyed wire towers are usually subleased from four large cell tower management companies, American Tower Corporation, Crown Castle International, Vertical Bridge, and SBA Communications. These firms control over 80% of cell phone towers in the USA and generally have a ground lease directly with the property owner. Most of the “big 4” cell tower companies purchased their tower portfolios directly from Verizon Wireless, AT&T, T-Mobile, and Sprint. US Cellular still owns all of its towers.

Understand what category your newly proposed cell phone tower and lease fall under to get a better understanding of the value.

• Is the proposed new cell site or cell tower being leased directly with a carrier or is it with a cell tower developer or tower management firm? Who is the “LESSEE” or “TENANT” in the lease agreement?
• Is the proposed lease agreement for a small cell lease or is it for a macro site?

Once you have determined if the proposal is for a macro or small cell site, and if the lease is a direct carrier lease or a tower developer lease, the next step is to evaluate why they chose your location, and what other possible choices they have nearby. The more alternate sites that you can eliminate, the better your chance that your location has of getting a fair deal. The more choices that they have, the less of a chance they have of getting a fair deal. Understanding cell tower lease rental values for your location can also help you to determine whether it is worthwhile to encumber your property with a cell site for the next 15, 25, or 50 years.

Existing cell tower leases being amended or extended before expiration need to be evaluated closely.

• Is the cell tower lease amendment or lease extension offer being made by a third party or directly by the cell tower company that is leasing the tower?
• Does the lease amendment or extension proposal contain a “guarantee period” or a reduction in rent, rent escalations, or for you to agree to modify certain terms about the tower company’s use or rights?
• Is the tower a single-carrier or multi-carrier site? How many subtenants are leasing or subleasing tower or ground space within the “Leased Premises” or fenced-in area?
• Is the “FLE DATE” (final lease expiration date) in 5 years or less (final term), in 10 years or less (second to the last term), in 15 years or less (usually about 3 terms left) or is there more than 15+ years remaining in your cell tower lease before it expires?

What exactly is a fair cell site lease rental price?

We have been asked thousands of times by landowners and building owners to help them to determine the rental value of the cell site or cell tower being proposed at their location or that already exists at their location.

• What do I do if I am offered a new cell phone tower lease agreement?
• How do I negotiate a cell tower lease?
• How do you calculate what’s the cell tower worth?
• What’s a fair annual rental price for a rooftop Verizon, AT&T, T-Mobile, or DISH cell site?
• What should I ask for in rental escalations?
• Is the price they offered fair?
• Is this a low-ball offer?
• Can I get more?
• Should I ask for revenue sharing and how much?
• But they told me they “never do… or they never give….”
• Will they walk away if I ask for more money?
• What is the price per antenna rent for a rooftop cell tower?
• Is there a per antenna price for an upgrade?
• Is there a square foot price on cell tower ground leases?
• What is the average backup generator expansion area worth?
• How much should I charge if they want to add a generator?
• Can I charge them more if they add more equipment to the tower or on the leased premises?
• Should I agree to reduce their rent and optimize the cell site?
• Will they move or take down the cell tower if I do not give them a rent reduction?

Request a cell tower lease valuation consultation with Tower Genius.

Our point is, that there are a lot of things to consider and evaluate when looking at a cell tower lease proposal. The person working for the cell tower developer or the leasing site acquisition representative from the wireless carrier is not going to tell you the key information that you need to obtain a favorable cell tower rental agreement.

Why not get the perspective of wireless leasing industry experts before you dive headfirst into your cell tower negotiation? Talk to Tower Genius, the USA’s premier cell tower lease consultants and transactional coaches. We save cell tower landlords time and money and frustration.  Contact us or Tower Genius at 1-888-313-9750.