Have you been offered a cell tower lease prepayment for your cell site's current rental revenue stream? Tower Genius offers wireless landlords considering structured lease prepayments as an option, the following specialized services:
Caveat venditor... is Latin for "let the seller beware". It's a counter to caveat emptor, and we at Tower Genius feel this is appropriate for today's cellular tower lease buyout marketplace. We want wireless landlords to be aware that they can be deceived with these transactions, and they need to exercise caution when approached with a Cell Tower Lease Prepayment proposal.
There are multiple firms offering cash for cell site leases, some are reputable, and some are not. Before you accept any cash offers for any of the cell tower leases you are currently receiving monthly rental payments for, it’s probably a good idea to get a second opinion. The telecom lease buyers and advisors offering cash for antenna sites are usually looking for a quick hit, and will likely want a perpetual easement from you in their offer, which means that you will be giving up the rights on all future cash-flow on the rooftop antenna lease.
We strongly advocate against those companies offering cell tower lease prepayment packages and cell site lease buyout offers based solely on pushing fear tactics about new technology, namely 5G, and planting seeds of doubt in landlords that their cell towers may be replaced or become obsolete. Of course, if carriers consolidate like Sprint and Nextel did, or Cingular or AT&T did, or Cricket and AT&T did, or Alltel and Verizon did, T-Mobile and Metro PCS did, like AT&T and T-Mobile almost did, and T-Mobile and Sprint did, there will be some cell towers and cell sites that get decommissioned due to redundancy. But even that will take several years after any merger happens.
Here's our 2021 analysis of cell tower and cell site obsolesce. It is our opinion. And we are almost always on the money.
And then there is that pesky matter about changing 5G and small cell technology, and how it could possibly affect the rents that landlords are receiving. Over the past several years Verizon Wireless has made significant progress with their small cell network deployment, and the other carriers have been watching on the sidelines waiting to see if they sink or swim with the small cell technology. Since 2015 we have seen a trend of small cells being fibered out to off-site base station warehouses, which are like mini data-centers. If and when small cells saturate a given market, especially in densely populated urban areas where rooftop cell sites dominate, these premium high-rent rooftop cellular sites could be in danger of being replaced by small cells in the next 5 to 10 years in our estimates. Even if smalls cell eventually will work in conjunction existing macro cell alar antenna sites, there is the matter of trickle-down economics that may impact the cell tower lease prepayment industry. So if you have a rooftop cell site in a major metropolitan area, you might want to have one of our Telecom Lease Geniuses take a look at it, evaluate your cell tower location's risk of obsolescence, and strategize with you. There is no magic wand in cell tower location evaluation. All telecom antenna leases values are site specific, and unique, based on topography, zoning, ground elevation, tree cover and foliage, availability of competitive sites for relocation and the location of surrounding cell tower sites in their network.
At Tower Genius we believe that cell towers using line-of-site RF technology are here to stay. Although in places like the land of fruits and nuts (California) you may find some granola type venture capital people launching new companies using drones or broadband balloons to provide more coverage and capacity, that will be the exception and will not be the norm. With that being said, the only tangible way to truly hedge your risk regarding future carrier rentals is to accept a form of cellular site lease prepayment. The cell site lease buyout offers available to wireless landlords vary depending on the aggressiveness of the buyer and the carrier who is your tenant.
If you are considering accepting a cell site or cell tower lease prepayment offer we encourage you to proceed with caution. These are shark-infested waters. You are signing over the rights to your lease rent stream. And remember, just as it extremely important to have a knowledgeable wireless telecommunications consultant and transactional coach (like us) on your side, whenever accepting a lease prepayment offer you should always consult a tax professional and or an attorney.
Talk to Tower Genius about your cell tower lease prepayment offers or for a valuation of your current cellular carrier antenna lease agreements.