One of our clients received a letter dated January 23, 2020, from MD7 in PDF format signed by an employee of American Tower Corporation. The author of the file is listed as MD7 and the initial name of the letter was “ATT High Rent Initial Mailer”.
The strange thing is my client’s site is not a high-rent site.
In fact he is receiving $600.00 per month in rent. A rent amount largely considered by both the landlord and tenant side of the industry, as a below-market.
Below is the letter he received from MD7
So What Did They Offer The Landlord?
Reduce the rent to $300.00 per month, or sell the lease to them for forever in exchange for $82,000.00.
Really?
Talking out of both sides of ones mouth rarely works.
On one side of their mouth they are saying the sky is falling and they need to cut a tiny rent in half to secure savings of around $3,000.00 per a year. An amount of money that is so small that it won’t even show up on American Tower Corporation’s balance sheet. Keep in mind that American Tower Corporation maintains an average reported profit margin of 85% on their cell towers.
On the other side of their mouth their saying, while the sky is falling and things are bad for you the Landlord, we will make it all better by paying you a one-time payment equal to below market price of approximately 12 years’ worth of rent.
This is comparable to someone coming to your house to buy your home. When they arrive they tell you that your home is about to be wiped out by a hurricane, but they will buy it anyway for cheap!
So what are we supposed to do?
Our options are cut our rent from $600.00 per month to $300.00 per month so our tenant feels better, or sell our contract for a below-market price?
How about we don’t do anything.
Entertaining communication like this is a complete waste of time for a property owner.
Remember as a property owner if you are not receiving a benefit to enter into an agreement, then don’t do it. Don’t accept below market deals and don’t fall victim to this approach.
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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).
I have recently been contacted by MD7 with an offer to reduce my income from an American Tower lease. They make a compelling case for me, (the uneducated). I am thankful to find the information in these testimonials but would really like to know more about the potential risks of ignoring these offers. What are the odds of ATC really pulling up their monopole and leaving my land? They currently have Verizon and T-Mobile on the site.
Hi Roy,
Extremely unlikely. Moving a cell tower with two wireless tenants on the tower such as Verizon and T-Mobile would be a difficult undertaking. It would require three companies to agree to move, three companies to agree on how much each company is going to pay towards the move, and then to move. It is a massive headache and a huge undertaking. All because a landlord won’t take a haircut on rent? Not likely to happen.
All the best,
Nick G. Foster
I keep getting letters from them and phone calls… I told them, I have a company that will take their place if they leave, do to, I didn’t lower their rent… the company said they’ll pay more per month… so…. see ya. Tim Andrew
Tim,
Thank you for sharing your story. I rarely if ever recommend reducing the rent, it is such a horrible idea. Rents go up, not down!
All the best,
Nick G. Foster
Nick –
One thing to add to this… We got this same letter last year, and MD7 called us. We told them not interested, and they insisted on us signing a “rejection” letter. In so many terms we told them to go pound sand, and that we would continue to operate under our current lease agreement. No rejection letter needed.
Adam,
Great point and excellent information to provide to our community. Thank you for the follow-up comment!
Nick G. Foster
We got a similar letter from MD7. They said our 2 carriers on our tower were merging so American Tower would receive less. They were wanting to cut our rent in half or give us a buyout of a fraction of what others were offering. We told them No not signing and they can take the tower down. They never did anything
Hi Arlene,
Thank you for sharing your story with the community.
Nick G. Foster
We got a letter from American Tower wanting to cut our lease in half. They are saying there is no one on our tower. We live in the country where our cell reception isn.t the greatest so I really can’t believe this is true. If we don’t agree they say they may have to terminate the lease. We are going to tell go ahead and take the tower down because we are not falling for this.
Hi Linda,
Thank you for sharing your experience with American Tower Corporation. To verify if there are any tenants on the tower, you can take photos of the cell tower itself, the ground equipment near the cell tower, and e-mail the photos to us for your review. We can confirm if you have any tenants on your cell tower, or if it is truly vacant.
In regards to tearing the tower down if you do not cut the rent in half. I have never heard of American Tower Corporation following through and tearing the tower down. I have certainly heard of this presentation to landlords, but I have never heard of them following through on what they are saying here.
All the best,
Nick G. Foster