Cell Tower Valuation and Brokerage
Through its partnership with SteelTree Partners, Steel in the Air has assisted in the sale of over $800 million worth of towers over the last seven years, and has helped over 3,000 clients with cell tower lease negotiations, buyout offers and asset management. We are industry experts with a proven track record of satisfied clients - and we plan on keeping it that way. We provide cell tower valuation and brokerage services, using comprehensive, timely data and in full consideration of all fixed and variable factors. For any type of wireless asset valuation, we are your trusted source.
Here's what we can do for you:
Review the Portfolio of Leases – We will evaluate your portfolio of towers and any current and applicable wireless telecom leases. We will recommend how you might divest it, given current market dynamics and future expectations.
Review Pending Proposals – We will review any requests by wireless carriers to modify existing leases, suggest appropriate compensation for any proposed expansions, and assist with the renegotiation of collocation lease rates.
Provide Fair Market Valuation – Using our proprietary tower sales database, we will provide you with a fair market valuation of your wireless asset portfolio. We will consider a comprehensive list of fixed and variable factors, including your towers' current values vs. projected full capacity values, as well as expenses and revenue flow.
Assist with Acquisitions – On your behalf, we will conduct an analysis of any prospective acquisitions or new builds, using our proprietary cell tower location database.
Broker the Sale – Should you decide to sell, we will advise you on how to favorably position yourself. We can broker the transaction on your behalf through an auction process that will assure you that you have received the best price and best terms for the sale of your tower assets.
What factors constitute accurate tower appraisal?
Here at SteelintheAir.com, we get multiple requests for the valuation of cell towers. Many requests come from real estate appraisers who have been called upon to evaluate a cell tower for eminent domain purposes or for taxation purposes.
Cell towers have been traditionally sold on the basis of a multiple of net cash flow. After deducting typical expenses for a cell tower, the net revenue from the tower is determined and a multiplier is applied to arrive at the purchase price. It must be noted that after first declining in trend with the economy from 2007-2009, tower purchase prices have since escalated rapidly, and buyers are paying more for towers than ever before. As a result of the high multiples and purchase prices, a number of tower owners are selling. Primarily, they see an opportunity to continue building more towers or see another investment opportunity and need the capital that is unavailable from other traditional sources.
The point of all this is that the valuation of towers is high. Many appraisers who contact us believe that they can apply traditional real estate appraisal techniques to tower valuation. Unfortunately, traditional real estate does not have the same level of federal protection as vested in the Telecommunication Act of 1996, nor are other commercial types of real estate subject to the low churn our industry sees. To further complicate matters, a statistically sufficient sample of tower transactions, especially current ones, is necessary (and not always easy to obtain) in order to provide an accurate appraisal.
The multiple established for cellular tower purchases is a combination of a number of factors:
- Current Tenant Base on the Tower: Are any of the tenants likely to terminate their lease prior to the last term? Are any of the tenants a financial credit risk?
- Age of the Tower: How long has the tower been standing? How aggressive or conservative has the lease-up on the tower been?
- Zoning Protection: Is the tower in an area where local zoning regulations will prohibit competing towers from being built up?
- Location of Competing Towers: Are there other towers within a given distance that would be satisfactory to wireless carriers? If there are nearby towers, are they really competing for the same clientele?
- Structural Capacity of the Tower: How many tenants was the tower originally designed for? How much capacity remains?
- Ground Space Availability: Is there ground space available for current tenants' expansion or for future tenant's equipment?
- Location of Tower: What are the coverage objectives of the tower? Is the tower primarily in a rural/suburban/urban area?
It should be clear from the factors above that cell tower valuation is based not only on existing tenants but on future capacity for tenants as well. While the valuation of an existing tower that is fully loaded is relatively straight-forward, the valuation of an existing tower with significant capacity remaining is not. That is why attempting to appraise a cell tower solely on the basis of comparable data fails to provide proper valuation. Each tower is as unique as the parcel of land on which it sits. We can assist you in evaluating a tower or portfolio of towers. We can also help you sell your tower. We know who is looking! Please feel free to contact us for additional information.
If you own a cell tower(s) (meaning that you actually own the steel) and are curious about its/their value, please contact us for a free cell tower valuation. We will need copies of your leases on the tower with the wireless carriers. If you do not have a PCS or cellular carrier or TV or FM/AM broadcasters leasing your tower, we can't provide a valuation because it is outside of our expertise. Please note that this offer only extends to the direct owner of the tower.