Mobile Tower or Mobile Site Lease Buyouts / HOME

Mobile Tower or Mobile Site Lease Buyouts

MOBILE PHONE TOWER LEASE BUYOUTS - In recent years a few companies have entered the mobile tower lease buyout industry- they purchase the remaining cash flow under a mobile tower or site lease. The transaction is sometimes crafted as an exchange of a one time payment for a lease assignment or a long term lease/extension on the owner's property in exchange for the rights to collect all future rent payments by the mobile tower owner. Other companies just purchase an assignment of the mobile tower lease or put in place a concurrent lease.

In some cases, the companies have also offered to purchase the land under and around the tower from the owner.

Some companies have resorted to "scare tactics" whereby they suggest that technology will make the tower obsolete in the near future. They also sometimes suggest that industry consolidation might shorten the duration of mobile tower leases. This is due to the fact that many agreements are written such that the tower company or wireless carrier can terminate the mobile tower lease without penalty with up to 6 months notice, as well as the fact that the lessees can terminate leases when they renew, which is generally every 5 years. While it is true that the mobile tower leases can be terminated, it is not a common occurrence that they will be. A number of entities have solicited owners and even signed contracts attempting to purchase mobile tower leases but some have gone dormant due to the unavailability of cheap capital.

One very important consideration for the owner with these proposals is whether your current lease is considered at market as the companies may be using multiples of existing rent for their analyses.

There are, of course reasons why a landowner might want to sell the remaining portions of the lease to a company that specialises in this type of transaction.

First and foremost is the opportunity to get cash out of your asset. These companies often can give a sizable payment when your financial institution would not. The purchasing companies can reduce the risk that any one lease will be terminated over the purchase of hundreds of leases, where the landowner could not. Landowners who have attempted to borrow against mobile tower leases often find that banks do not loan against them due to the termination rights common in most mobile tower leases.

Secondly, depending upon the location and the company purchasing the mobile tower lease rights, the offer might be one that the average landowner with a mobile tower lease would be hard pressed to turn down. Determining which situation the landowner is faced with, requires expert review and advice.

Third, in certain situations where a landowner has potential exposure to termination due to say the Vodafone/Hutchison (VHA) merger , the sale of the mobile tower leases for a lump sum can eliminate the risk that those companies will terminate the mobile site lease. We can help you gauge that risk and determine if the sale of the lease is right for you.

If you are interested in simply getting a better offer, contact us with the details of your lease and any buyout offer you currently have and we will be happy to see if we can beat it. There is no cost to you.

If on the other hand, you are interested in getting assistance with whether you should sell your mobile tower lease, we can assist. SiteXcell has consulted with many landowners on mobile tower lease purchase offers based on in depth analysis of the landowner's site and the surrounding wireless environment. We can assist you with working through the wireless side of the decision and help you determine what you are really selling. We can help ascertain what the real remaining term of your mobile site lease will be so that you can figure out the true "present value" of your lease. We can tell you the history of the lease purchase market as well as where we expect it to go. We can help you answer the decision of when the best time to sell is. We have compiled a database of numerous transactions and can tell you trends in this arena. Furthermore, we can determine whether or not you are passing up future revenue that you might not have known about.

Please contact us for a free estimate of what a review will cost.