Strategies for Cell Site Lease Negotiations
Property Owners typically begin cellular lease negotiations by researching comparable lease rates data. They may contact associates who have towers on their property, or they might attempt to search the internet for cell tower lease rates. They sometimes research county property records for recorded leases, only to find that the recorded documents are only short form leases and do not contain lease rate data. They may try to examine the Multiple Listing Service (MLS) to see if there are any cell tower leases listed – only to find that there are not. In doing this research, the typical landowner does not find much in the way of truly comparable data. Or if they do find comparable data, there are so few data points that it is difficult to draw any accurate conclusions.
"We can determine why the carrier or tower company is interested in your property and how you can use that knowledge to negotiate a better lease rate."
In cell tower lease negotiations, the party with access to the most comprehensive data almost always has the advantage. In most cases, this is the tower company or wireless carrier who initiates the lease. They know whether there are other properties nearby that will work for their purposes. They know what average lease rates are for specific markets. And they know what landowners will typically accept and what they won’t. The carrier or tower company will often play one landowner against the other in order to negotiate the cheapest lease. In some cases, they will even pretend to be negotiating with another landowner when in fact they are only negotiating with you.
Since the lease being negotiated with the cell tower company can exceed 25 years, it is imperative that landowners understand their relative strength (or weakness) in negotiations. The primary factor that contributes to the landowner having the upper hand in negotiations is whether their property is unique to the wireless carrier. If negotiations go poorly with the cell tower company, can they simply go to your neighboring property owners and negotiate a better lease? If so, then your strength in negotiations is limited. If not, then you can afford to push harder for better lease rates and better terms and conditions in the lease.