We continue to see a high-volume of activity in the cell tower lease market. Knowing that your time is valuable and limited – let’s hit on the key points in the market.
T-Mobile Sprint Merger Buzz
Last week a Wells Fargo analyst, Jennifer Fritzche, told investors in a research note that T-Mobile would likely be the buyer, not the seller, in a merger with Sprint. This projection is a role reversal from when the parent company of Sprint, Softbank, failed to acquire T-Mobile in 2014. While the roles have been reversed, the merger is still discussed as a good move to compete with wireless giants Verizon and AT&T.
The FCC has also gone through some changes. Former FCC Chairman, Tom Wheeler, is out as of January 2017. The new FCC Chairman, and previous attorney for Verizon, Ajit Pai is in. The Trump administration is a much more favorable environment to approve a merger.
What does that mean for property owners with Sprint or T-Mobile cell tower leases? In the event of a merger, one of the two leases will be terminated. Currently most buyers of cell tower leases are paying close to market to purchase T-Mobile leases. Buyers are paying slightly below market to purchase Sprint leases. History has shown us (Clearwire, MetroPCS, Nextel) in the event news goes public that a merger is taking place, buyers will immediately stop purchasing leases of the loser of the merger.
Upgrades & Renewals Increase Your Income
T-Mobile is currently leading the pack with renewals and upgrades. AT&T and Verizon are also active with Sprint taking fourth place in activity. Rooftop installations lead the way in opportunities to significantly increase your NOI. Installations outside the lease area and renewals, provide time-sensitive opportunities to greatly increase the rent you receive.
Tower companies such as Crown Castle and American Tower Corporation continue to contact property owners requesting to extend lease agreements. Sometimes it will make business sense to entertain the offers. Other times it may be a complete waste of your time to discuss any renewal. To receive an assessment of the value of your time and the opportunity, contact an expert.
New Cell Tower Lease Construction
Often we are seeing T-Mobile contract out new cell tower lease construction to mid-sized tower developers, instead of bearing all the construction costs on their own. The new cell tower lease agreements are very one sided in favor of the tenant. Property owners are best served engaging an expert to assist them in securing the best terms with their opportunity. Many new cell towers are being constructed across the country, however you have to wait for them to come to you (instead of you seeking them out in the reverse).
How Can We Help?
We are currently working on new cell tower leases, lease renewals, cell tower lease buyouts, and expert witness work. With over forty Success Stories, our results speak volumes to our ability to assist you with your cell tower lease.
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About Nick G. Foster
Since founding Airwave Advisors® in 2014, Mr. Foster has added value to over 400 clients ranging from the State of Nevada, City of Beverly Hills, to Habitat For Humanity. Mr. Foster focuses on cell tower lease renewals, buyouts, new lease negotiation, and cell site lease management. Prior to starting Airwave Advisors® Mr. Foster founded and led the Cell Site Services Group within nationwide commercial real estate services leader Cassidy Turley (now known as Cushman & Wakefield).