siteXcell are telecommunications industry experts here to protect your present and future commercial interests
Is your property currently leased by a carrier or have you been approached by a carrier who is interested in entering into a telecommunications lease for a new tower or facility on your property?
Mobile tower lease agreements are unique and very often the real objectives and effects of their provisions are not widely recognised or understood by those outside telecommunications infrastructure leasing. As a result, most landowners are unable to get the most out of their new telecommunications lease or renewal negotiations.
Getting the most out of a telecommunications lease agreement involves more than just trying to get the highest rent you can.
What is a fair rent? How do you prevent your rent from becoming eroded by future economic events? What other restrictions does the carrier intend to place on your ability to deal with your property? Are the restrictions reasonable? Which clauses command more scrutiny than others? Do you have future plans for the property that may be impacted by a telecommunications lease on your property? These are but a few of the questions that landowners – and even their advisors – are often uninformed about. They may not have the required level of insight in order to decide whether a telecommunications lease will ultimately be beneficial in their circumstances. As a result, landowners can often be persuaded to agree to the standard terms and conditions of a carrier’s telecommunications lease agreement without the necessary level of information and advice to make a fully informed decision.
The number of mobile telecommunications towers and rooftop facilities has dramatically increased since the late 90’s to early 2000’s.
As a result, it is not uncommon for a landowner who has recently been approached by a carrier to establish a new facility on their property to know, or know of, another landowner who has an existing facility on their land. This can be both helpful and a hindrance. Most landowners are rightfully concerned with, but sometimes overly focused on, the face rent that the carrier is offering. Leases that were initially established in the late 90’s and early 2000’s have now been through at least one renewal cycle and the commercial parameters under which those leases were originally established no longer apply. In addition, carriers have been much more willing to use their powers under Schedule 3 of the Telecommunications Act to press landowners on terms. As a result, landowners often find themselves comparing apples with oranges; comparing an offer for a new facility against the current rent for a facility established 10 years ago can be misleading, unless of course, you have access to the site data of thousands of sites across the country. In addition, the telecommunications infrastructure landscape has changed dramatically since that time, with network objectives constantly changing and new players entering the telecommunications leasing market seeking to apply extreme downward pressure on landowners to accept significant reductions in the rent they are paid.
Whether you have been approached by a carrier for a new mobile tower lease, the upgrade of an existing facility, or renewal of a telecommunications lease that is about to expire, it is imperative that you seek specialised advice from siteXcell.
The new telecommunications infrastructure leasing landscape is more fluid than it has ever been. siteXcell’s strength has always been its intricate knowledge of the market and its close proximity to issues as they start to surface, ensuring that its clients are best able to navigate and take advantage of those changes.
New lease and lease renewal negotiations
Our extensive market knowledge means you’ll receive the maximum commercial return from your lease negotiation. We ensure unforeseen events don’t erode your revenue, and you retain the ability to deal with your property without unnecessary restrictions.
Surrender and re-grant negotiations
Does a carrier wish to install additional equipment and increase the area it occupies on your property? Their request could change the terms of your existing agreement, potentially triggering a surrender or re-grant. siteXcell can assist with the renegotiation of the commercial terms, ensuring you receive the maximum return.
Termination, relocation, and make good negotiations
Significant work goes into installing telecommunications equipment on your property. That’s why, when a carrier vacates your site, you must enforce ‘make good’ obligations. We can assist with negotiations to ensure your asset isn’t compromised and is returned to its original state.
We are experts in understanding what is being proposed when a carrier requests an ‘upgrade’. Our priority is to increase or protect your commercial return by clarifying how the upgrade will impact your property.
Frequently Asked Questions
What is unique about a telecommunications lease?
Telecommunications leases need to consider the unique operational requirements of carriers both in the present and into the future. As a result, carriers need to be provided with reasonable scope to respond and adapt to changes in technology and network objectives driven by their customers. Although carriers are largely absent tenants, when they do need to access their site, they may need to do so quickly, at any time of the day or night, and with or without very much notice. Not only do carriers require the ability to carry-out certain types of activities within their lease area, but they also require the ability to utilise other parts of a property outside their lease area, the degree to which, some landowners are surprised by. The term ‘carrier’ now also applies to infrastructure companies – or tower companies – who have different operational pressures and commercial objectives. Telecommunications leases also contain provisions to protect their commercial interests, and in doing so, carriers will also seek to place various restrictions and prohibitions on a landowner which may affect or curtail their ability to deal with their property. It is imperative that landowners have a better understanding of the operational and commercial requirements of carriers so that mutually agreeable outcomes can be reached.
Do I really need to ‘renegotiate’ my telecommunications lease?
Absolutely! When a telecommunications lease is coming to expiry or a carrier has contacted you to express its interest in renewing its occupation at your property, this represents a perfect opportunity for landowners to consider what changes have occurred in their personal circumstances, whether their plans for the property are different from when the lease was first entered into, how has the telecommunications leasing market changed – or whether they even want a telecommunications lease on their property anymore. Renegotiation is an inflection point to consider whether your experience of having a telecommunications lease on your property was a generally positive or negative experience over the last 20 years or so. For landowners, renegotiation opportunities are limited and should not be squandered or given up lightly. Not taking advantage of a renegotiation opportunity may see you locked into a lease agreement that is no longer in your best interests, no longer reflects your present and future plans, and does not reflect current market conditions.
How do I know if I’m getting a fair deal from my mobile tower lease?
Every landowner’s circumstances are unique. For some landowners, a particular clause may be a pressure point, for others, the same clause is barely of any consequence. With the right advice, most landowners are able to reach a conclusion regarding whether the intent or objective of a clause within a telecommunications lease is ‘fair’ in their opinion. And with assistance, landowners can generally reach a middle ground in relation to non-commercial matters where the interests of both parties can be accommodated. However, what landowners commonly think is ‘unfair’ is the amount of rent they are currently being paid or have been offered. Understandably, landowners are worried that they will agree to a rent that is below what the carriers are paying to other landowners with the same type of facility on a similar type of property in the same area. For the majority of landowners, there is no way to access comparable site data, and therefore, commercial decisions are mostly made in a vacuum – but for the provision of ‘comparable’ site data supplied by the carrier supporting their argument as to why a lower rental should be paid. Over the years, siteXcell has accumulated site data for thousands of new and renewed sites, and this data is used to both educate landowners and moderate expectations and counter the ‘cherry picked’ data provided by carriers.
How do I start the process of renegotiating my mobile tower lease?
In general, unless otherwise provided for in an existing telecommunications lease, opportunities to renegotiate the terms of a new or existing telecommunications lease are infrequent. If you have been approached by carrier for a new telco tower lease or a proposed upgrade of the facility under an existing telecommunications lease, contact siteXcell as soon as possible. The siteXcell team can guide you through the entire lease negotiation process or advise you on whether a proposed upgrade represents an opportunity to renegotiate with the carrier. With our extensive market knowledge and industry experience, we can help you achieve the best commercial return from your lease negotiations.
What should I expect during the renegotiation process?
The renegotiation process can vary depending on the specific needs of the carrier or the specific terms of your existing lease. For new leases, the carrier to confirms your interest in having a telecommunications facility on your property via a Heads of Terms (HOTs). The HOTs will detail the commercial terms and some other important terms that the carrier wants included in its lease agreement with you. It is important to carefully consider the information in the HOTs before agreeing, as carriers will strongly resist changes to the HOTs following execution. Where an existing lease is up for renewal, or an upgrade is proposed, which gives rise to an opportunity for a renegotiation, carriers will seek to apply maximum downward pressure on the rent it proposes to pay. Carriers will ordinarily approach landowners for renewal negotiations anywhere up to 24 months prior to expiry and look to secure their continued occupation at the site as soon as possible. Irrespective of whether a new site or renewal is proposed, telecommunications agreements can take many months to finalise and be time-consuming. Landowners, therefore, need to be prepared to devote a significant amount of time and effort during the process in order to get the most out of their agreement. Our telecommunications leasing specialists can support and assist you through the entire process.