Afraid of Rocking the Boat: When to Build Your Own Tower
Rocking the Boat.
A gentleman called us two days ago. He had been approached by a local tower company to build a cell tower on his property. We had an initial discussion, and he seemed intrigued by our services. The initial offer from the tower company was pretty decent, better than an initial offer should have been for this area. I suggested this to him and also suggested that typically when a tower company makes an offer like this, it is because the property is unique. This gentleman owned a significant amount of acres along a difficult-to-cover corridor. The tower company had no other choice but to use his property.
After meeting with the tower company, he had the courtesy to call me and indicate that he wasn’t moving forward with our services and that he had accepted the offer on the table. It appears he was afraid of losing the deal on the table. Essentially, he was afraid of “rocking the boat”. In this case, it is likely that he passed on a few hundred thousand in revenue over the course of the lease. Had he gone forward with our services, this would have been one of the rare cases where I would have recommended that the landowner build and operate the tower directly. So instead of getting a few hundred dollars per collocation, he would have received significantly more.
I told him that he was making a mistake over the phone- not because I needed the small fee we would have charged for his consultation, but because I truly believed he was making a mistake. He and his family were pleased with the offer on the table, though, and understandably didn’t want to lose it. Furthermore, he decided to negotiate the lease agreement himself, as well. I write about this one out of frustration. He was clearly a bright and cordial man and no doubt had significant wisdom and knowledge, but his lack of understanding about the tower industry led him to pass up on what could have been a much better deal. Even if he had just wanted to simply lease, there was at least $500/mo more in it for him. In the end, his fear of the unknown prevented him from making an informed decision. Clearly the tower company representative was a better salesman than I was in this case. Perhaps I should have been more aggressive.
