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Cell Tower Lease Renegotiations

We recently heard from a property owner who had been approached by a "wireless consultant" for his cell tower tenant to renew the cell tower lease on his property. The conversation had gone something like this:

Consultant: We'd like to renew our lease on your property.

Landlord: Ok, what did you have in mind?

Consultant: We normally look to reduce the rent on your site, however we are willing to keep things the same if you sign a 30 year extension and don't make any changes to the lease amendment we give you.

Landlord: I believe your rent should go up.

Consultant: That would be unacceptable. If you aren't willing to extend the lease as is, I'll tell your tenant to take the tower down.

When we questioned the consultant, he immediately backed down and restated his position that the tenant makes the decisions regarding decommissioning towers, he only made recommendations. Unfortunately this approach is not an isolated event. We see numerous cases where property owners have accepted rent at below market rates, or have been approached by their cell tower tenants for rent reductions. While some rent reductions are justified, those instances are rare. We have seen wireless consultants approach property owners regarding rent reductions at both the high and low end of market rent. Except for a few rare instances, we have not seen any evidence showing that a property owner taking a rent reduction does anything other than save money for the cell tower tenant.

We can help you make sense of these situations. Call or click here to contact us today.