A church cell tower lease can provide a significant benefit to the income of a church. As a member of a religious institution you understand the significant benefits of receiving recurring revenue. A cell tower lease can provide your religious institution the much needed capital it deserves for years to come.
It is important however to proceed with caution. Cell tower lease companies typically try and offer religious institutions and non-profits less money than other private property owners.
They think you really need the money so you will take whatever they offer you (typically a low ball offer). Do not allow them to take advantage of your generous goodwill nature.
Churches are popular locations for cell towers and cell sites. To help understand you why and to help you manage cell tower leases on churches, here are the top six things to consider with your church cell tower lease!
1. Why Are Churches Popular Locations For Cell Towers?
The two most popular reasons cell phone companies love churches are (1) elevation and (2) preferred land use.
Elevation – Typically churches offer the highest elevation (or height) with their tall steeples towering over surrounding buildings. This presents an opportunity for a cell phone company to attach their antennas to the steeple, or rebuild the steeple to house their antennas inside hidden from the public.
Land Use – The surrounding land use around churches is typically a residential land use, however churches often offer cell phone companies a preferred non-residential land use. This is preferred as it conforms with many city ordinances regarding placement of cell towers. The non-residential land use allows cell tower companies to construct a facility similar to the one in the adjacent image. The antennas are hidden behind the cross at the top.
2. What Should Churches Look Out For With Leasing?
Cell phone companies often offer churches discounted rents. With a church cell tower lease ensure you receive fair market rent. When approached by a cell phone company we highly recommend engaging cell tower lease experts such as Airwave Advisors.
Too often we review lease agreements where the church was so excited to start receiving rent, that they made a long list of mistakes by not engaging lease experts. Mistakes that once made, were not able to be undone.
3. Churches Need To Make Sure They Are Receiving A Fair Deal
It is not right but cell phone companies take advantage of churches with low lease rates. A few years later they will hire a company such as MD7 or Blackdot to pitch unnecessary rent reductions. Are the cell companies really looking out for your religious institution?
While we like to think Verizon, AT&T, T-Mobile, and Sprint act ethically all the time we must remember they are a huge profit driven companies. Their interest lies solely with their shareholder. Their goal is to secure the lowest rent and the best deal for them, not the church. We have witnessed cell phone companies offering lease rates to churches sometimes 60% lower than market.
Make sure you contact a cell tower lease expert such as Airwave Advisors to have your offer reviewed prior to signing any agreements.
4. Take The Time To Read The Fine Print
While a new church cell tower lease with new rent coming in can be a very exciting thing it is important to “slow down”. Don’t let the cell phone company pressure you into signing anything or taking any actions you are not ready to take. The cell tower lease agreement from Verizon is typically 36 provisions and AT&T‘s is 24 provisions. That is a lot of legal language written by them to slant rights in their favor, not yours.
Take the time to read the fine print.
You are about to agree to an agreement that will dictate rights for the next 20 – 35 years. It’s important to have an expert walk you through this agreement to help you avoid common mistakes others have made.
5. Remove The Right Of First Refusal Provision
Standard in most new AT&T and Verizon leases is a provision called Right Of First Refusal or Rental Stream Offer. This provision is towards the end of the lease agreement and it will severely impact the church should the church ever want to sell their lease. This provision must be removed and if AT&T or Verizon says they cannot remove the provision they are not being honest. We have successfully removed it from countless lease agreements. If this provision makes it into the lease agreement, when you are ready to sell very few if any buyers will make offers on your lease. A church stands to lose tens if not hundreds of thousands of dollars in the market if that happens. The church wants competitive buyers when it comes time to sell their lease, not a right of first refusal for AT&T or Verizon.
6. How Can A Church Ensure They Receive A Fair Deal?
Have your cell tower opportunity or lease reviewed by cell tower experts such as Airwave Advisors today. We have helped churches receive market rents, fair lease terms, and protected them from common leasing pitfalls.
- Why have they contacted our religious institution or non-profit to place a cell tower? Typically they have contacted your group for a few reasons. First, often religious institutions and non-profits are located on land with favorable zoning for cell towers and adjacent to residential areas. Second, they think they can get a really good deal with your group because they usually think you desperately need the money. Finally, religious institutions in particular typically provide them steeples which give them a good height to locate their antennas to provide coverage to the surrounding community.
- Are churches popular locations for cell towers and cell sites? Absolutely. The cell tower industry loves installing on properties occupied by religious institutions and non-profits. It is typically easier to get a deal done on their terms. That means a lower rent and better terms for them. Make sure you are not leaving money on the table and being take advantage of. Contact Airwave Advisors!
- What should we look out for with a cell tower lease? Everything! You will be presented a cell tower lease drafted by their legal counsel which is one-sided in favor of them. They view you as an easy target so the business terms will likely be low. Both the lease and the business terms can be improved significantly with our help.
- How do we get a cell tower for our church? Wireless carriers and cell tower companies need to contact the church. Often if the property is in a desirable location, they have a need in the area, and a budget to construct, then they will reach out. To learn more check out our article Cell Tower Locations.
- We are a tax exempt 501(c)(3) non-profit how will a cell tower lease this affect us? Also inquire with a qualified tax advisor to see what the tax implications will be, if any, once you have a cell tower paying you rent on your property. Our understanding is you will not lose your tax exempt status, however, please check with your tax advisor.
- Will the cell tower require a change in the zoning classification of our property? Typically the answer is no. One of the many reasons wireless carriers like installing their equipment on properties occupied by religious institutions and non-profits, is the property is surrounded by residential, however, it is zoned commercial or some other non-residential use. This typically makes it easier to construct a cell tower. One thing you should always look out for in a cell tower lease is to ensure your tenant does not have the right to change the zoning classification of your property without your written approval.
- We do not have much money to pay advising fees, can you help? Yes. We have flexible fee structures to accommodate entities that may be unable to pay market rates for advising services. Give us a call and we can discuss further.
To ensure your institution maximizes their opportunity in new cell tower lease negotiation, lease renewals, or in cell tower lease buyouts, make sure to have Airwave Advisors on your side.
Below are testimonials from clients we have worked with, Habitat for Humanity, and Sacramento Adventist Academy.
We were more than pleased with the results that we achieved from Nick Foster and Airwave Advisors. I was really impressed and understood the gravity that Mr. Foster brings to the table, when we had a negotiation with AT&T and no less than nine people attended the call on behalf of AT&T, to discuss the lease with Mr. Foster and I. The results of the call were impressive and I would recommend Mr. Foster to others. He surely contributed to the growth and security of our affiliate.Jim W., Executive Director of Habitat for Humanity of St. Joseph County
Nick Foster of Airwave Advisors provided tremendous value in helping us better understand our cell tower lease. We can say first-hand that Nick does a great job in not only advising us landlords on the lease agreement but also in leading us to a position to obtain positive results.Greg F., Board Chair, Sacramento Adventist Academy
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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).