Steel in the Air has served over 3,000 clients and reviewed over 8,000 wireless leases. Since the wireless telecom industry is a fairly new market, we find that many of our clients are less than sufficiently informed about industry dynamics, their rights as property owners or the fact that there are several types of wireless leases. In an effort to be a valuable public resource, we wrote this page to bring some light to the different types of leases.
When you think of a cell tower lease, you are probably thinking of what we refer to as a ground lease. This is the lease agreement between the property owner and the company (wireless carrier or tower company) that erects the tower on the property. The ground lease specifies the actual territorial boundaries that will be utilized when erecting the tower and usually includes and access and utility easement to and from the lease area. This initial ground lease is extremely important as it contains many variables other than just lease rate (such as lease size, permitted use, and length of term) that set the stage for future possibilities, and income at the site. The below is an example of a survey showing a 100’x100’ ground lease with a 20’ wide non-exclusive access and utility easement (tower location is shown the triangle in the middle of the lease area.
Rather than a modification or amendment to an existing ground lease, an Additional Ground Space Lease is a new lease (almost always) with a different party than the Lessee of the original ground lease. This type of agreement is most often with a carrier that needs initial or additional space at the site. For example, say you are already party to a ground lease with Crown Castle that includes the 10’x10’ lease area for the tower and just enough lease area that is sufficient for AT&T’s equipment. If an additional carrier (Clearwire/Sprint in the below example) would like to utilize the same tower, they would need to lease additional ground space, since there currently isn’t available room in the ground lease area to add their equipment. In this case Clearwire/Sprint will then contact you, the property owner, to negotiate a new separate ground space lease, as a result of which, you will receive additional rent. Please see the below site plan showing the 7’x7’ Additional Ground Space lease area that is being proposed by Clearwire/Sprint (noted with a red dot and shaded in this example).
Also known as a “tenant lease,” the Tower Collocation Lease is a contract between the wireless carrier and the tower owner, who can either be another wireless carrier or a tower company. Typically the tower owner is already engaged in a ground lease with the property owner, although sometimes the tower owner owns the property upon which the tower is built. When wireless carriers collocate on an existing tower, they make payments to the tower owner directly in exchange for utilizing the tower and ground space. If additional ground space is required, then the wireless carrier would enter into an additional ground space lease with the landowner, in addition to the collocation lease with the tower owner. Please see the below sketch showing the same site as above in which Clearwire/Sprint is proposing equipment on the tower (noted with red dots). You can also see the carrier’s proposed ground equipment to be in the 7’x7’ additional ground space lease (noted with a blue dot).
Lastly, just for additional illustration please see one more example of a proposed tower collocation, where the carrier is proposing to install equipment on the tower (noted with red dots) and the ground space. In this example the tower owner controls sufficient ground space and so an additional ground space lease is not required.
