American Tower Cell Tower Lease
If you have questions about a proposed or existing lease with American Tower, you came to the right place. Many landowners have retained our services to help with the following issues:
- American Tower Corporation has a lease on my property, and they want to extend the lease or renegotiate it.
- American Tower has sent me a proposal to lease my property for a tower.
- American Tower wants to buy my lease.
Contact Us
- Who is American Tower?
- Why Does American Tower want to extend your cell tower lease?
- How to respond to a request from American Tower to lease your land.
- How much are American Tower cell tower lease rates?
- What are the key parts of a American Tower lease?
- Our recommendations for improving a American Tower lease.
- How Steel in the Air can help you with your proposed or existing American Tower lease.
Who Is American Tower?
American Tower owns approximately 43,000 cell towers in the US and Canada– making them the largest tower company in the United States. In the US, ATC generates approximately 33% of their revenue from T-Mobile, 25% from Verizon, and 29% from AT&T. Steel in the Air is not affiliated with American Tower – if you found our page by accident while looking for American Tower, you can find them at www.americantower.com.
American Tower Wants to Extend my Cell Tower Lease
American Tower (like other tower companies) is very interested in controlling the land under their towers for the long term. By the end of last year (2022), American Tower was leasing 63% of their sites while they owned the land under 37% of their sites, either by fee simple or by long term easement. American Tower’s average lease term is 30 years. For leases that were originally entered into in the 1990s, many of those leases are expiring in the 2020’s. Globally, 32% of American Tower ground leases expire in the next 4 years.
To renew their leases, American Tower has retained third-party companies to renegotiate existing leases with landowners. These agents may claim that your lease is at risk if you don’t extend or sell it to American Tower – this is almost never true.
Landowners with existing American Tower cell site leases are typically in a good position to negotiate. We would estimate that in 90% of situations, there is room to negotiate a better lease. Why?
- We estimate that the average ATC tower has slightly more than 2 subtenants leasing space on the tower. These companies pay American Tower $2000/mo. or more each.
- Because relocation of an existing tower is complicated and expensive; this generally costs $250,000 or more.
- Because the wireless carriers on the towers really don’t want to move to a new location. They designed each site based upon the location of other sites and the specific coverage and capacity goals they have in mind for that location. Moving can upset the design or coverage. Wireless carriers hate to move, and in some situations, American Tower can’t move the tower without their approval.
American Tower Wants to Lease my Land for a Cell Tower
American Tower has not been overly active in building new towers in the United States – over the last three years they have only constructed 40 towers. Chances are that if American Tower has contacted you to lease your land, they have another tower nearby and are worried about losing the lease under it. The nearby landowner may be refusing to extend their lease with American Tower. Alternatively, they may be developing the property and no longer want the tower on the property. Lastly, the landowner may be asking for a sizeable increase in rent, and American Tower is looking to find backup options in case they aren’t able to extend their lease under the existing tower. Or they intend to use their negotiations with you to discourage the nearby property owner from asking for too much.
If American Tower has approached you for a new lease, please reach out to us. We can review American Tower’s other towers in the area and determine whether they are likely looking to relocate from an existing tower site to your property. If not, great – we can then help you figure out how much they need your property. If they are looking to relocate, we can help you determine whether it makes sense to spend much time or money on American Tower’s proposed lease. We can help you understand how much leverage you have in negotiations and recommend best practices and business terms for a cell tower lease.
How Much Are American Tower Cell Tower Lease Rates?
American Tower’s average ground lease in our cell tower lease database pays just over $1,500/mo., although their leases range widely with some leases as low as $1/mo. and others over $10,000/mo. The average lease rate is just that – an average. This average should not be relied upon to negotiate new leases or when negotiating an extension to an existing lease. Every tower site is different and there are many factors that influence how much American Tower should pay for your specific property or for the renewal of their lease.
As for American Tower’s collocation leases (the lease between them and wireless companies that lease space on their towers), American Tower’s rental rates typically start around $2,000/month and go up from there.
What Are the Key Parts of an American Tower Lease Agreement?
American Tower’s typical wireless tower lease works like this:
- The landowner agrees to lease a portion of land (i.e., the “lease area”) to American Tower for the placement of a tower. For a self-support or monopole type tower, the lease area is generally 100’ x 100’ or less. For a guyed tower, the lease area may be up to a few acres due to the guy anchors. See our page on types of cell towers for more information.
- The lease includes an exhibit which shows the specific location on the property for the “Leased Premises” also sometimes referred to as a “compound.”
- As part of the lease, American Tower is given 24/7 access to their lease area and a separate easement across the property for utilities. Generally, the landowner does not have to provide utilities for American Tower’s use as American Tower will procure their own meter and pay for their own power.
- Under the standard American Tower lease agreement, the landowner agrees to lease the property to American Tower for an initial term of 25 years, followed by up to an additional 75 years. American Tower can terminate in most cases with less than 90 days, while the landowner is obligated for the full term.
- American Tower pays the landowner monthly rent for the cell tower, though some leases are paid annually. American Tower typically proposes to lower the escalation to one to two percent per year.
- The lease provides that the landowner is not allowed to interfere with American Tower’s wireless equipment or tower.
- American Tower will typically have to hold general liability insurance during the lease.
- American Tower’s standard lease requires them to remove all above ground equipment and improvements at the expiration. If you had to remove it, it would cost you between $25,000 to $50,000.
- American Tower’s lease includes a non-Compete clause that is overly broad. This clause would prevent you from selling, leasing, or otherwise competing in any way with American Tower.
- American Tower may assign and sublease as they see fit.
- American Tower’s lease includes a confidentiality clause – but only as it pertains to the landowner sharing information about the lease. ATC doesn’t have that same responsibility.
- The landowner is responsible for real property taxes on the entire parcel, but American Tower will pay personal property taxes for their equipment and will reimburse the landowner for a portion of the real property taxes that are “directly attributable” to their improvements.
- American Tower adds a “Right of First Refusal” clause to all their leases which means you can’t sell their lease to a third party without first giving them the chance to purchase it. See our page on the Right of First Refusal clause for more information.
- The last part of the American Tower cell tower lease is the exhibits. These typically include a “Memorandum of the Lease,” which may be recorded with the county or city, and which shows the location of the lease area on the property.
SITA’s Top Recommendations for an American Tower Cell Tower Lease Agreement
Here are just a few of the suggestions we give our clients:
- 100 years is ridiculously long! We recommend reducing the total number of years of the lease to 25 or 30 years, especially if they already have a tower on your property.
- American Tower should be required to remove the tower at the expiration and any below-ground improvements to 3’ below grade.
- The Right of First Refusal should be removed or if they won’t remove it, it should be narrowed so that it only applies to companies which operate cell towers or purchase the leases underneath them. It should NOT prevent the sale of the entire property to anyone. Furthermore, American Tower should not be able to “pro-rate” their offer based on the acreage of their lease parcel – that’s absurd.
- It is reasonable to have a non-compete that prevents the construction of other towers on the property. It is not reasonable to have a non-compete clause as broad as American Tower’s.
How Can Steel In The Air Assist With American Tower Cell Tower Leases?
You may have been contacted by a American Tower representative (aka, site acquisition agent) regarding the construction of a cell tower on your property. We can:
- Advise you on the appropriate signing bonus, option payments, rent, escalation, revenue share, and lease duration terms.
- Help you negotiate the best lease possible.
- Make sure you understand the pros and cons of entering into such leases.
- Help you and your attorney review the lease document and make suggestions (such as the valuable ones above) that help make sure you aren’t entering into a long-term mistake.
- Answer your questions before, during, and after the lease terms are negotiated.
If you already have an American Tower lease, you may have been contacted by American Tower’s agents looking to extend the lease. In most cases, you don’t need to extend the lease unless it is within 5 years of the final expiration of the lease. We are experts in valuing expiring leases since we’ve reviewed more than any other consultant.
Here’s what we can do for you:
- Figure out how much American Tower needs the site. Are there other towers nearby? Other rooftops?
- Provide data on what other American Tower pays for rent on other similar leases when they expire.
- Recommend how much the site is worth to them going forward.
- Advise on when the best time is to negotiate for the best lease terms.
If you have received an offer to extend, you may have also received a request to lower the rent. You are probably somewhat familiar with lease renegotiation tactics (also referred to as lease optimization). American Tower retains third-party optimization agents who will try to get you to agree to better lease terms (for them). They use certain “tricks of the trade,” like high-pressure sales tactics and implied threats of termination to convince (coerce) you into worse lease terms and conditions.
We will review the situation and:
- Figure out how much American Tower needs the site. Are there other towers nearby? Other rooftops?
- Determine how costly it would it be for them to move.
- Figure out the probability that American Tower would move their cell site or tower if you choose not to renegotiate.
- Review with you the pros/cons of renegotiating the American Tower Wireless lease.
Eventually, almost every lease holder receives an offer to purchase their lease. Most landowners are contacted by multiple companies who want to buy the lease. Some of these companies also try to make you think that if you don’t sell, your lease will be terminated. We help landowners daily determine what their best options are.
We analyze your site location and:
- Determine whether the lease is at fair market value.
- Ascertain if there is any risk that American Tower would terminate.
- Assess the value of the American Tower lease.
- Recommend whether it would be better to extend the lease or sell it.
- Help you realize the best price and terms if you decide to sell.
Some of our clients have great attorneys who know real estate, but don’t know as much about telecom leases. We can help you (and them) understand the nuances of a wireless lease.
If you need help with anything regarding an American Tower cell tower lease, here is our commitment to you:
- We won’t pitch you on buying your lease.
- We won’t add you to our newsletter (unless you ask), and you won’t be contacted more than once for a follow up.
- The information you share with us during the call is confidential and will remain confidential. We NEVER sell your data to lease buyout companies.
- We will let you know if the time is too early for our assistance, or if we feel we can’t help in your situation.
- The initial call is free. You don’t owe anything until you sign a contract for services with us – we also have flexible payment options to suit your needs.