Blackdot and Cingular offer Landowners the Opportunity to Remove Their Own Tower
Landowners with cell tower leases who are being hit with termination notices from the "NEW" Cingular are now being granted one new opportunity. The offers come from Blackdot accompanied with the termination of the lease letter. These offers if you can call them that have BlackDot offering to market the tower site to other carriers in return for the landowner taking over the responsibilty to remove the tower at the end of the 2 year marketing term.
In essence, the landowner is betting that Black Dot, a company with no marketing staff for towers, can market a tower that was not fit for the combined networks of Cingular and AT&T to other carriers. In return the landowner bets the responsibiilty of removal of the tower- which can run $30,000 or more. Not a great bet to me.
Is there potential value in these towers? Ask yourself or the Black Dot reps why they would be willing to give them to you if there was? Compare your risk of $30,000 against the expected lease rate that Blackdot will give you if they are successful at marketing the tower. Try to ascertain why the tower is empty and whether or not it makes sense to take on such a risk.
When you come to conclusion that its not worth the deal that Black Dot is offering- contact Steel in the Air. There may be other options that might be more attractive- like another company who will take over the responsibilty of removing the tower AND pay you rent in the event that they can find a new tenant.
Municipalities Undervalue Cell Tower Leases by Bidding
I recently read another story about a municipality that created an auction to bid off the rights to lease its wireless properties. The municipality- which will remain nameless- provided an RFP to the wireless carriers to gauge interest for its municipal properties. The story was written from the perspective of how successful this auction was because they received 3 bids- none on the same properties.
The municipality mistakenly provided a minimum bid requirement and guess what- the carriers all bid the minimum. So in essence- rather than negotiating leases for municipal properties on an individual basis at market rates- this municipality sold the rights to its properties at a below market rate.
Why? Because the municipality mistakenly believed that wireless carriers would actually bid for sites. The reality is that the carriers are smarter than this. They know that the likelihood of carriers bidding for cell tower or cell site locations is minimal. The carriers know that there will be limited responses so they don't feel that it is necessary to do anything than bid a nominal increase over the minimal bid requirements.
So municipal properties that have presumably higher value to wireless carriers because they are exempt and or favored in municipal zoning regulations went for less than privately owned towers. The solution is that municipalities need to get a better grasp on the value of their properties and either set appropriate minimums for different properties or bid sites separately. Otherwise, they will continue to provide their constituents a disservice by allowing carriers to use public property at below market rates.
TMobile Cell Tower Landowners being Contacted to Renegotiate Lease
So yet another carrier chooses to enlist the services of lease renegotiation companies. The game is the same- either you choose to renegotiate or your site will not be prioritized in the network. With one huge difference- TMobile has not merged with any other carrier.
The companies provide evidence in the form of an analyst's forecast stating that TMobile has to either merge or be purchased to survive. From this the reader is left to infer that if they choose not to negotiate, that TMobile may not make it and will have to abandon its towers.
This argument is simply misleading and erroneous. TMobile will not live or die as a company on the basis of a renegotiation of some of its leases.
There is a good possibility that TMobile will merge or be acquired. But renegotiating a cell tower or cell site lease in preparation for the merger that may or may not occur makes no sense. TMobile has no idea which cell sites would be terminated- because they don't know what company they might merge with. And if they are acquired by some company other than those with existing networks- they would need their network just the same as now.
The only reason we could see that a landowner would even consider renegotiating a lease is if the lease was above average in terms of rent and there were other suitable land locations or buildings in the area. Before TMobile would even consider removing a cell site or tower and building another, the rent savings would have to be significant.
If you still have concerns about the possibility of termination in the event that you choose not to negotiate, please contact us- we can advise you of the risk and provide you a strategy on negotiation.
