In 2012, wireless subscriber use surpassed 100% – meaning that the average person in the US has more than one wireless device. Wireless data use is expected to quadruple between 2012 and 2017 (CTIA) The problem for wireless carriers who provide these data services is that their cellular systems were designed to accommodate voice traffic not data traffic. Since voice traffic is significantly less burdensome on a wireless network than data traffic, the wireless carriers will invest over $25 billion in 2013 to improve their wireless networks. This capital is going primarily to new cell site development and to modifications on existing cell sites. In either case, hotel owners stand to gain additional revenue from rooftop cell site leases.
The lease rates that are paid by the wireless carriers fluctuate fairly widely with most hotel owners receiving between $1,000/month and $3,000/month per each individual lease. These leases typically escalate at 3% per year and are rarely terminated. The primary factors that we have identified that impact lease rates are as follows:
If you already have a cell site lease, chances are you have been contacted or will be contacted in the near term by the carrier to make modifications. Sometimes the carrier will ask for your consent to perform “maintenance” on the rooftop equipment and in other cases, they will offer to compensate you for the modifications. In either case, the smart hotel owner should ask for construction drawings before they consent to any modifications. In many situations, the wireless carrier has no right to make the modifications and is asking for consent to avoid paying the hotel owner additional rent which would otherwise be required. Thus, before you grant consent, make sure you understand whether your lease allows for these modifications. If it does not, you may be entitled to extra compensation. If in doubt, contact an expert in wireless leases.
