Should we agree to a 10 year guaranteed larger monthly payment on our lease because cell towers are going away?

by Jean
(South Carolina)

We have had an American Tower cell phone on our property for 14 years. We receive a monthly payment for this that goes up a little each year.Over the years many companies have tried to purchase the lease for a big one time buyout. Now we have a company from California trying to purchase the lease for a guaranteed 10 year monthly payment plan that is almost double the monthly amounts we receive now. At the end of 10 years no more payments. They are claiming that may be the life of cell phone towers rather than 18-20 years of our present lease. Even though our contract with American Tower is actually for another 36 years. How do we decide? They are telling us that our present agreement is a gamble and their new easement is guaranteed 10 yrs of payments.

Comments for Should we agree to a 10 year guaranteed larger monthly payment on our lease because cell towers are going away?

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Mar 05, 2014
Scare tactics
by: Anonymous

Hi. Number 1: The tower is not going anywhere.

My mistake....

I fell for the same Bull droppings around 10 years ago. ATT hired a company to make me believe they are consolidating and might decommission my site if I don't discount the escalator of 6% and lower the monthly rent. Well I fell for it. Escalator to 3% and discount on the rent. To date I have not collected rent of $115,000 that I would have. No info 10 years ago like to day.

After all the scare tactics of decommission, they wanted to buy it. Why??? Because they sell these at a premium to the big tower management co. American and Crown. Didn't make sense.

By the way, mine is:
15 year straight term lease with no cancellation. Whoopeeeee. Really Stupid. In four years or less, it's my turn to renegotiate. No profit sharing. Shame, Sprint came on board for land and sub lease tower space from ATT. Land rent to me, but no tower rent!!

On your lease, the company who is trying to buy your tower is trying to get you to finance their ownership/control of the tower. Once they get your tower from you, they will sell it.

If you want to even think of selling go to Crown Castle or American Tower. They have offered me the most. Most all the others are middle men that buy from you (10 to 14 times annual rent) and sell to AT or CC (at 15 to 17 times annual rent).

The amount is based on carrier, location and the interest rate. Today,these are investments with a return.

My tower is located at one of the busiest intersection of fwys in the world in So. Cal. I have been offered nearly a million dollars from one of the big tower managers. I have not taken it because I have no where to place the $. A 1031 tax deferred exchange is 1st choice, but no deals this good yet. And I will not sell it out right due to the stupid amount of tax that it would cost me. Major loss of net worth. By the way, around 10 years ago I was offered $85,000.

I have not counter offered either.

So, cash up front (taxed), cash with a 1031 exchange or keep it. See what Crown castle will offer before selling.

My two sense.

Mar 05, 2014
Tough One
by: Anonymous

Wow, this is a tough one. I have not been given this offer yet. I would have to see the difference in the two incomes. Of course it is a gamble for all parties not just you. The buyers are gambling as well.
I think you have to look at your life and children's if any. I have three.
Do you want to be able to do things now that you maybe couldn't afford without this offer, or are you younger than I , 59 and have plenty of time to enjoy some traveling and leisure time.
Can you pay off your mortgage? How can this money best help you? Don't forget the taxes on income. How much does Uncle Sam take.
Would this be guaranteed for 10 years regardless if cell towers were not being used. This is where their gamble comes in.

Figure all this out financially and then if you do decide to accept the offer, American Tower might have the right to first refusal and be able to top the other offer.

Get professional help from a Tower expert such as this one before signing any new contract.

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