Lease optimization companies

Cell Tower Lease Optimization

What Is Cell Tower Lease Optimization?

As of the beginning of 2024, there are approximately 150,000 to 175,000 cell tower leases in the United States. Many of these leases have been in place since the mid-90s. As these leases come up for expiration (or before), the wireless carrier or tower company who entered the lease almost always tries to improve the lease in their favor. These improvements range from:

1. Lower rent

2. Lower escalation

3. Removal of termination rights by the lessor (landowner)

4. Removal of consent provisions that require consent for new equipment or subleases.

5. Addition of right-of-first-refusal clauses

6. Addition of expanded permitted use language (allows the carrier or tower company to make changes without your consent)

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    Why Cell Tower Companies and Wireless Carriers Want to Optimize Leases

    There are several reasons why companies try to renegotiate existing leases. First and foremost is greed. They simply want to generate more profit and squeezing the landowner is one way to do that. Another reason is that over time, the wireless carriers have revised their standard lease documents adding language that is beneficial to the carrier but worse for the landowner. Lastly, they do it because they have engaged cell tower lease optimization companies to negotiate these improvements on a contingency basis. In other words, the carrier doesn’t pay anything until the lease optimization company is successful at renegotiating the lease.

    What are Cell Tower Lease Optimization Companies?

    Cell tower lease optimization companies are company that negotiate better leases on behalf of wireless carriers and tower companies. These companies hire salespeople to negotiate with landowners who have existing cell tower leases. Their goal is to convince landowners to amend their leases with terms that are more favorable to the wireless carrier or the tower company. The salespeople and the company get higher compensation the better deal they negotiate for the carrier or tower company. For example, one company we know of gets a % of any savings in rent over the first 10

    years of the lease. They also get bonuses for each lease clause they can get inserted into the lease that is favorable to the carrier or tower company. In some cases, they are retained to try to extend leases much farther in the future. They may also make an offer to buy the lease. A list of some of these companies is included below.

    What to Do If You Have Been Contacted by A Cell Tower Lease Optimization Company

    First, don’t panic. These companies love to try to use artificial deadlines to convince you to make a rash and quick decision. These deadlines are almost never real. So, you have time to make an informed decision.

    Second, figure out the expiration date on your lease. If your lease isn’t due to expire within a few years (after all extensions), you have plenty of time.

    Third, unless your lease is over $1,500/mo. or $18,000/year, you likely have nothing to worry about. Even if your lease is over $1,500/mo. or $18,000/year, chances are you have nothing to worry about.

    Fourth, do not make a rash decision out of ignorance or fear. On many occasions, we have come across renegotiated leases. In most cases, there was no reason for the landowner to agree to the terms they did.

    Fifth, contact us. We will do a quick review of your lease and location at no cost to you. You may be surprised, but at least 70% of the time landowners contact us after being contacted by a cell tower lease optimization company, we tell them they don’t need our services and they can safely reject the request to renegotiate. The other 30% of the time, we share our initial thoughts and provide a proposal for doing a full evaluation of the proposed lease renegotiation.

    Cell Tower Lease Optimization Companies

    We have provided contact information, including web addresses for each of the companies in case you have found our website in error while searching for these companies.

    Black Dot Wireless

    VISIT THEIR WEBSITE: WWW.BLACKDOTWIRELESS.COM

    Historically, Black Dot (also Blvck Dot) has worked for AT&T, Sprint, T-Mobile, Verizon and US Cellular. These inquiries take the following format:

    · Requests to amend the cell tower lease to add a “Right of First Refusal” clause and to make changes to the “permitted use” language.

    · Requests to extend a cell tower lease that has less than five years remaining. · Requests to reduce the lease rate currently being paid to the cell tower landowners.

    · Requests to expand the lease area and permit the tower owner or carrier to add equipment and antennas (this clause has become increasingly more important).

    In some cases, Black Dot will offer a nominal increase in the lease rate in exchange for an extension of the lease duration. However, we caution all landowners who are approached by Black Dot on behalf of a wireless carrier to be wary of any proposed changes. These proposals (even the ones that increase the lease rate) almost always attempt to encourage the landowner to sign an undervalued lease extension or to agree to terms that could materially reduce the value of the site.

    If you have received an offer from Black Dot, please forward it to us. We will review it at no charge and either recommend that you do nothing (decline to make changes) or (provided that we believe we can help) we will quote you a cost for our services.

    MD7

    VISIT THEIR WEBSITE: WWW.MD7.COM

    Md7 has historically provided services to the same companies as Black Dot Wireless. These two companies are direct competitors, and at times, if wireless carriers were not seeing satisfactory results (a significant number of changes to existing leases) using one company, they would engage the other. Today, most of the contact we see from Md7 is as follows:

    · Proposals to extend leases for AT&T.

    · Proposals to amend AT&T and Sprint leases to add additional equipment to the site.

    · Proposals to purchase leases from leaseholders (in this capacity, they are acting as a lease buyout company).

    If you have been contacted by Md7 regarding your AT&T or Sprint lease and have been asked to sign an amendment with little to no compensation, we advise you proceed with caution. You may be entitled to additional compensation for those modifications.

    With the increasing chatter regarding the Sprint/T-Mobile merger, Md7 representatives try to suggest that by doing a deal now, you can reduce the possibility of termination of your lease under a merger. In our opinion, unless they are willing to remove termination rights in the lease for at least seven years, these offers may not be worth considering unless you have a high rent.

    Please reach out to us and we will gladly review your lease and the proposal at no cost and then let you know whether you need our services further and if so, how much they will cost.

    Smartlink

    VISIT THEIR WEBSITE WWW.SMARTLINKLLC.COM

    Smartlink contacts landowners with offers to renegotiate the terms of AT&T leases and other carrier and tower companies. Smartlink alleges that the landowner’s cell-site lease is under review in AT&T’s “TOSS” program- which is likely just a catchy acronym intended to suggest to landowners that their site will be “tossed” if the landowner does not agree to the revised terms.

    Like the other lease optimization entities above, Smartlink is likely compensated based on a success fee for encouraging landowners to renegotiate. We have not seen enough of their offers to know whether Smartlink is targeting higher-paid rent leases or just a random sample of leases.

    Either way, if you have received an offer from Smartlink on behalf of AT&T or another carrier or tower company, please feel free to forward it to us. We will review it and let you know whether you should reject the offer, consider it, or whether we should do a review to evaluate the risk to your site if you choose not to accept the revised terms.

    Lyle Company

    VISIT THEIR WEBSITE: WWW.LYLECO.COM

    While not considered a lease optimization company per se, Lyle Company does assist some tower companies with lease negotiations, such as lease extensions and lease buyout offers. Most of the inquiries we see are from landowners who have been contacted by Lyle Company acting on behalf of Crown Castle. Their proposals take two forms: · Proposals to extend the expiration terms of a Crown Castle lease agreement.

    · Proposals to purchase an easement for a lump sum under an existing Crown Castle lease agreement.

    Regardless of why an agent from Lyle Company is contacting you, they are always seeking to procure the best value for Crown Castle. They have amassed a substantial amount of data and information on their side. They know how much the tower is worth to Crown, how much leeway they have in negotiations, and what other options are available to Crown. You should too, and that is where we come in. We help level the playing field by assisting you with optimizing your lease extension or lease buyout, if that is in fact what you want to do

    Insider tips

    Requests to reduce monthly lease payments are typically but not always detrimental to your bottom line. It is important to look at the terms of the lease holistically. In some cases, if your lease is too high, there is a possibility that the tenant could relocate the tower.

    You may have received an offer to purchase your cell site lease (what is referred to as a “lease buyout”). Contrary to what you might be lead to believe by the company who has made you an offer, the risk that your lease will be terminated may not be a factor at all. In other words, buyout companies are in the business of profiting, not in buying leases that are going to be terminated.

    Steel in the Air prides itself on accurate, ethical, data-driven analyses. Some other websites and cellular consultants have accurate data, but skewed advice (due to self-serving motivations), while others have honest intentions yet biased data. Steel in the Air has the best of both worlds. You can depend on us. Just ask our clients.

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