Are Three Towers Really Necessary?

Zoning Board Questions Whether They Should Be Forced to Allow Three Towers Within 300' of Each Other

First- start by reading this news article about how the Cape Elizabeth, ME planners are dealing with a request from Tower Specialists to build a new tower near an existing Crown Castle tower that has already been slated to be torn down and replaced with a new tower on the adjacent property. In the image below, the site to the right is the existing Crown Castle tower which the article indicates will be torn down in 2019. The location to the left is the new Crown Castle tower.

Why would Crown Castle tear down an existing tower and build a new one next door?

Because they couldn't come to agreeable terms with the existing landowner to extend their ground lease on the existing property. We are contacted regularly by landowners for proposed Crown Castle leases and the first thing we look at is whether there is an existing Crown Castle tower near the proposed location to see whether this is occurring. Most of the time we find that there are existing towers nearby. In some cases, Crown is moving the tower because the existing owner is seeking too high of a lease rate for an extension of the lease or because they are no longer willing to lease their land for a tower. In other cases, the existing tower needs substantial structure modifications to accommodate additional equipment and it is cheaper over time from a Capex and Opex standpoint to build a new tower. And in rare cases, we believe Crown Castle will build a new tower out of spite because they don't like the landowner.

To make this even more interesting, if you look at the image below, you will see that there is a second tower on the same property. The Crown Castle tower appears to have 3-4 wireless carriers collocated on it, while the other tower has 1-2.  Apparently there are 6 towers on the subject property including some smaller ones not visible in the photos. 

So, I Get Why Crown Castle Is Building a Tower, But Why Is a Third One Proposed?

Good question. We heard directly from the property owner who is also a tower developer.  He shared with us that he did tell Crown that the family wasn't going to renew the lease.  He proposed the new tower after Crown submitted to relocate the existing tower on the adjacent property.   

The property owner in the article suggests that the carriers all want to be at 180' (even though only one carrier was at that height previously on the existing tower).  The Town Board has required him to come back with detailed RF propagation maps that show that the carriers all have to have 180' as justification for a third tower here. While I am sure that the property owner can find a radio frequency engineer that will provide maps that purport to show a difference – there really isn't a significant one between 170' and 180' especially since those carriers who are lower than 180' on the existing tower already built the nearby cell sites in their network to match up with the coverage from this tower and vice versa.  

How Do Landowners Know if They Are Pushing Too Hard?

Unfortunately, signing a backup lease with an adjacent property owner is now standard operating procedure for tower companies when negotiating an extension of an existing tower lease. The tower companies will take the term sheet they negotiate and show it to the stubborn  landowner as demonstration of their willingness to move the tower. For landowners who are approached for a new lease, we advise they consider the possibility that they will spend time negotiating and finalizing a lease and money on hiring an attorney or a consultant or both to review the lease while not getting anything in return. For landowners who have an existing tower on their property, the "equation" for whether you are asking for too much is a difficult one because it depends upon the following variables:

1. Cost to relocate the tower

2. Probable lease rate on alternative site location

3. Probability of success of getting zoning and other regulatory approvals

4. Ownership of the tower (does the tower company own the tower or does the carrier)

5. Number and identify of carriers on the existing tower

6. Time remaining until expiration

7. How much you are asking for

8. How difficult you have been to negotiate with in the past

Whether you have been approached for a new cell tower lease near an existing tower or you have an existing tower lease where you are negotiating for an extension, we can help. Give us a call to discuss further or contact us here.

 

 

 

Want a Kinder Less Aggressive Tower Company Leasing Specialist? Just Fill Out a Survey!

Image of surveyOne of our client's called us yesterday to let us know that they had been beleaguered by a tower company rep who was perhaps too anxious and aggressive regarding a lease extension for a lease that wasn't set to expire for another 8 years.   This particular client has a Mona Lisa tower- a phrase American Tower used previously to refer to 4-6 carrier towers.   In other words, it wasn't going anywhere.   For some reason, the tower company rep felt that being aggressive and making all kinds of threats to move the tower and to cease discussions would make the landowner agree to the proposed terms.   

The landowner received a survey from the tower company- a generic one that asked about how the landowner felt about the tower company and whether lease payments were coming on time.   The landowner filled out the survey and added comments at the bottom that he didn't appreciate the rep's aggressive nature and angry demeanor.   Within a few days, the agent called him and apologized and the negotiations took a decidedly more friendly turn.    Perhaps that was because our client's tower is a very valuable tower.   Perhaps not.  Either way, if you are having a problem with your tower company rep and their negotiating tactics, fill out a survey or let the company know directly.   While the rep will and should continue to make threats about moving the tower, they should be able to do it in a less aggressive and cordial manner.  Both parties should remember that these negotiations are not personal, they are just business.  Treat the discussion as a business discussion, remove the personal aspect, and if you need help determining the business terms, consider contacting us.  

CCI expresses interest in buying Verizon towers

Crown Castle (CCI) is the largest of the Big Three U.S. tower companies, and currently owns 40K towers nationwide (followed by American Tower with ~28K and SBA with 15K).   In September 2012, CCI bought 7,200 cell towers from T-Mobile, and in October 2013 it purchased 9,700 from AT&T.  CCI spokesperson says the company is now open to buying 6K towers from Verizon, which would be a $3B acquisition. [Read more…]

American Tower Lease Extensions – DELAYED!

A good portion of our business comes from landowners who have received offers to extend their leases from the large tower companies like Crown Castle or American Tower.   We evaluate the proposals and recommend what the tower lease is actually worth to our clients.   [Read more…]

Crown Castle’s Newest Lease Extension Ploy

Crown Castle has been contacting landowners saying that Crown has been informed that their site is “one among several in your geographic area that has been chosen to be looked at more closely by the carriers on the tower to determine long term viability of the site”.   “Those sites with less than 20 years remaining on the ground lease have become the focus of the carrier’s concerns”.  Crown further goes on to state that “Meetings to determine if your site meets optimal operational requirements has been scheduled for the week of November 7-11th, 2011” and that they need your lease extension before then. [Read more…]

Crown Castle and Nextel Revenue Sharing

On a few occasions now, clients of ours with Crown Castle tower ground leases have received proposals to either purchase or extend their ground leases.   These lease extension or lease buyout offers are attempts by Crown Castle to tie up long term rights under their towers.   This is nothing new, as they have been making these offers for years now to every one of their landowners. [Read more…]

Crown Castle offers landowners who sold to Wireless Capital Partners the "opportunity" to extend their cell tower ground lease.

A landowner sold their cell phone tower lease to Wireless Capital Partners. The Wireless Capital Partners lease assignment and successor lease provided that they controlled the rights to the cell phone tower lease for 30 years. The lease actually has only 26 years remaining, so Wireless Capital Partners received 26 years under the assignment of lease and 4 years under a successor lease. A successor lease provides for the rights vested under the current cell phone tower lease after the expiration of the current lease. [Read more…]

Verizon Cell Phone Tower Leases Expiring in Sizeable Numbers

It appears that many of the initial Verizon’s cell phone tower leases are getting ready to expire over the next few years. This includes a number of towers acquired by Crown Castle. Although hardly empirical- our data suggests that Verizon is waiting to approach many landowners until a few months prior to the expiration of their cell phone tower leases. [Read more…]