Negotiating Cell Tower Leases | 5 Tips From Experts

By Nick G. Foster

May 20, 2015

Negotiating cell tower leases is a unique experience, unlike negotiating a residential or a commercial real estate lease. The scales of leverage in negotiations are typically tipped in favor of the cell phone company. Typically, there is a high supply of land, or building options, available to the cell phone company and a limited number of opportunities, if any, available for the property owner. If the deal gets too expensive, the tenant can walk. However, are you giving away the farm in your negotiations? Here at Airwave Advisors®, we want to share with you 6 tips to help tip the scales of negotiation in your favor.

1. Empower Yourself With Knowledge

As the old saying goes – knowledge is power. When negotiating cell tower leases, knowledge will pay dividends in securing both better economic and lease terms. Too often, representatives for cell phone companies take advantage of property owners because the property owner just didn’t know any better. Don’t believe what you are being told by a representative that is being paid and incentivized by a party you are negotiating against. Empower yourself with knowledge – and there is no greater knowledge that can be obtained than by hiring a cell tower lease expert such as Airwave Advisors to be by your side.

2. Always Hammer Out Business Terms First

Business terms always come before lease revisions. If both parties can’t agree on business terms, then making changes to the lease is pointless. Occasionally, we will see a representative for the carrier request a counter offer with changes to the lease provisions. While this is a smart move by their representative, it is not in the best interest for the property owner to address at this stage. The property owner would end up spending time and, potentially, money reviewing the lease, only to risk having the deal fall through due to an impasse on business terms.

3. Rent Will Not Be Calculated On A Per Square Foot Basis

Although cell phone companies will be leasing a specific area on your land or building – do not fall for calculations based on rent per square foot. Cell tower and cell site foot prints are often small, sometimes only a few hundred square feet in urban markets – however, the value of that area is worth significantly more than any proposed per square foot rental rate. Consult with a cell tower lease expert such as Airwave Advisors to ensure that you are securing the highest rent with your opportunity.

4. Everything Is Negotiable

The lease area, the term, rent, rent escalator, access rights, etc – everything is negotiable. Just because the agreement will likely be signed on the cell phone company’s paper, doesn’t mean the language is unable to be revised. Read every line. As they say, the devil is in the details. Fully understand what you are signing and don’t allow the other party to pressure you into signing anything that you are not comfortable with.

5. Tenant’s Have Experts On Their Side, Make Sure You Have Experts On Your Side

There is a reason cell tower lease companies use cell tower lease experts in every deal – results – it gets them better deals. If your tenant is using cell tower lease experts to negotiate against you, shouldn’t you have cell tower lease experts looking out for your best interests?

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2 Comments

  1. Cornelio A Butay on January 17, 2021 at 3:55 pm

    I have 2 hectars hill land wanted to rent a cell site located in san nicolas ilocos norte philippines.

    • Nick G. Foster on February 12, 2021 at 6:24 am

      Hi Cornelio,

      We are not currently working in the Philippines. Thank you for reaching out.

      Nick G. Foster

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Nick Foster Airwave Advisors

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).