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.
In the fourth quarter of 2013, CCI’s site rental revenue was up 14% from 2012 Q4, 3% of which came from the 9,700 towers it purchased from AT&T in October 2013. Concurrently, the Big Four Wireless Carriers are building out their 4G LTE as quickly as possible, which means leasing more space on towers to set up their antennas. In other words, competition in the wireless infrastructure industry is just as strong, if not stronger, than ever before.
So, if CCI does buy Verizon’s towers, what will this mean to property owners engaged in leases with Verizon? Well, depending on what you want – the news is either good or bad. Verizon pays more for lease extensions than CCI does, but CCI pays more for long-term buyouts than Verizon would. In other words, CCI will be more aggressive about buying the rights to the underlying lease than Verizon was, so if this is your goal, you are certainly better-positioned now.
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