(updated on February 18, 2020)
How Much Land Is Needed For A Cell Tower?
You have land and the cell phone carrier wants to lease it from you, but how much do they need? What are the appropriate cell tower land lease rates to apply to lease your land? These are common questions that we receive daily from property owners across the country.
It’s important to understand that every piece of land is unique. To help you get the answers you are looking for we want to share with you 5 Things You Should Know With Cell Tower Land Lease Rates.
1. Always Counter Their Initial Offer
The initial offer presented by a cell phone company can sometimes be 300%, or more, below market!
It is important to speak with a cell tower lease expert, such as Airwave Advisors, to secure a fair market deal with your cell tower lease. Remember that whatever cell tower lease rate you lock-in today, will be locked in for the next 20-to-30 years. Subject of course to whatever rent escalation you agree to in your cell tower lease agreement.
Giving up even $100.00 a month in rent can cost you over $50,000.00 over the life of the lease!
Don’t leave money on the table, or guess at what you should charge your cell tower lease tenant. Close the deal with confidence that you secured the most out of the opportunity.
2. Carriers Always Ask For More Land Then They Need
Most representatives for new cell towers across the country are asking for a 100′ x 100′ lease area. That is 10,000 square feet, of your property, that the cell phone company will control for several decades!
Here is the secret cell tower companies don’t want you to know…
They really only need approximately 300 square feet. The usually only need a 10′ x 20′ area (200 square feet) to place their ground equipment, and a small footprint for the base of the cell tower. They don’t need thousands of square feet, and they certainly don’t need ten thousand square feet of land.
So Why Are They Are They Asking For So Much Land?
They are trying to lease extra land from you now to sublease to other carriers in the future. By controlling 10,000 square feet of your land today, they will then receive 100% of any ground and tower revenue generated from any future subtenants. The future sub-tenant may be another wireless carrier or a small radio station. Either way they capture 100% of both the ground and the cell tower rent (if they lease extra space from you today).
This leads us to our next tip…
3. If They Want Extra Space, Secure Co-location Rent
If your cell tower tenant want’s to lease thousands of square feet from you, make sure you get a share of any future tenant’s rents. If another tenant want’s to co-locate onto the cell tower sitting on your land, you deserve a piece of the action. After all, it is your property that the cell phone company is now making money off of. If the cell tower company secures multiple tenants on the cell tower, they will be making money hand over fist.
Make sure that you have a cell tower lease expert, such as Airwave Advisors, in your corner to help you secure the best cell tower lease rates and revenue sharing arrangement.
4. Land Lease Rates Are Not Comparable To Your Neighbor
One of the most common mistakes that we see property owners make, is when they call other property owners who have cell tower leases to see what they are getting paid.
Our intuition tells us this is how we can sample the market and to compare our offer to landowners currently receiving cell tower rent. However, the fact is that most cell tower leases – including the one down the street with your neighbor – were poorly negotiated.
Too often property owners try to negotiate cell tower leases themselves. Mistakes are made and money is left on the table. This is all but guaranteed unless a property owner engages a subject matter expert to help them maximize their opportunity.
5. How Do I Maximize My Cell Tower Land Lease Rate?
The carrier’s have cell tower lease experts on their side who negotiate hundreds of deals per a year. Thousands of cell tower leases over the course of their career.
Unfortunately, when a property owner enters into discussions with cell tower lease professionals who do this for a living, they are outmatched from day one. Even though a property owner may think they are getting a fair deal, they are often leaving money on the table.
You have to remember that the representative who has reached out to you is paid by the cell tower companies. Often they get a flat-fee for finalizing a deal and a bonus if they can convince the property owner to agree to below market terms.
The Cell Tower Companies Have Experts On Their Side, Shouldn’t You?
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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).