Crown Castle on May 1, 2020, filed their 10-Q filing with the SEC. Airwave Advisors reviewed the filing and here are the key takeaways for cell tower lease landlords:
- Crown Castle currently owns or manages approximately 40,000 cell towers across the United States.
- Towers segment revenues represented 66% of Crown Castles Q1 2020 net revenue. The remaining percentage was fiber rental revenues.
- 74% of Crown Castle’s site rental revenues were derived from AT&T, T-Mobile, Verizon, and Sprint for the three months ending March 31, 2020. On April 1, 2020, T-Mobile & Sprint announced the completion of their merger.
- Approximately 53% of Crown Castle’s towers are lease, subleased, or are operating under managed master lease or subleases with AT&T and T-Mobile/Sprint. Crown Castle has the option to purchase these towers at the end of their respective lease terms.
- Crown Castle owns in fee simple interest or under long term easements 40% of the land underneath their towers.
- The average tenant lease on a Crown Castle tower is between five (5) to fifteen (15) years for wireless tenants. With options for the tenant to extend for another five (5) to ten (10) years each.
- Crown Castle’s lease agreements with their tenants contain either fixed escalation clauses or inflation-based escalation clauses (such as those tied to CPI).
- In September 2019, Crown Castle received a subpoena from the SEC requesting certain documents from 2015 through present, primarily related to Crown Castle’s long-standing capitalization and expense policies for tenant upgrades and installations in its services business.
- In February and March 2020, class action law suites were filed against Crown Castle on behalf of shareholders alleging false or misleading statements, or other failures to disclose information about Crown Castle’s business, operations and prospects.
- In April 2020 a stockholder derivative lawsuit was filed against Crown Castle alleging breaches of fiduciary duties, waste of corporate assets, unjust enrichment, and false or misleading statements, between February 27, 2018, through the present.
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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).