American Tower Corp tower ground space targeted by opportunists
A client of our was approached by a site acquisition agent who they mistakenly thought was a representative of American Tower Corporation. American Tower leases space on their property for a tower. Due to the physical size of the building and the small size of the parcel, there is not much room remaining for expansion.
The site acquisition agent offered to sign a lease with the landowner to allow for future expansion for wireless collocations on the American Tower site. The problem is that this wasn't an American Tower Corporation rep. We believe that the site acquisition agent was simply trying to get a below market lease from the landowner so that they could turn around and release the space to the next wireless carrier who was going to collocate on the American Tower site. This particular landowner thought the representative was from American Tower but after we investigated further, it was clear that they weren't.
If the site acquisition agent was willing to pay for the lease, this might not have been so bad. Instead, they wanted an indefinate option to lease. In other words, they would not have to pay any rent until they chose to which would only occur when American Tower corp added another tenant and found that there was no expansion room for the ground lease.
We don't know for sure whether this was only a one time only thing- but we suspect that it wasn't. If it wasn't, then it appears that cell site ground lessors have yet one more group of people that they don't want to be contacted by.
Labels: American Tower, cell tower ground lease, lease buyouts
MetroPCS set to build over 1000 sites in New York
Now that MetroPCS has acquired spectrum under the Advanced Wireless Services auction and spent over $363,000,000 to acquire the 10 mHz NYC C block license (shown in dark red) which covers 27,000,000 people and acquired an additional 10 mHz of spectrum with the Northeast D block license (shown in light red) for $552,000,000 which covers the entire northeast and includes over 50,000,000 people, they have plans to start building out the network. See
MetroPCS auction bids in this PDF from the FCC. (Map -copyright 2007- Steel in the Air, Inc.)
As MetroPCS is new to the NYC area, they are essentially building an entire network from the ground up. That means that many New York City rooftop owners will be contacted by MetroPCS leasing representatives (called site acquisition agents) to lease their rooftops/billboards/towers/property. We have heard that the initial build plans for MetroPCS in the New York metropolitan area will be around 1000 to 1300 cell sites. Each of those will need a cell site lease- whether a rooftop cell site lease or a cell tower lease.
If you are contacted by MetroPCS for the use of your property- Steel in the Air, Inc can assist you with evaluating the MetroPCS cell site lease proposal. We can ascertain whether they have numerous options and we can assist you with making sure that you get a fair market value for the site. We can be retained on a hourly consulting basis or on a commission basis based upon the value of the increase in your lease that we help you procure.
If you are looking for legal assistance with evaluating the MetroPCS lease- our sister company, Cell Tower Attorney can help you review the proposed lease and protect your interests in the negotiations. Please see our page on the
MetroPCS cell site lease agreement. We are licensed in New York state.
Cell Site Lease Buyout Firm Backs Out of Purchases of Sprint-Nextel Leases
If you have been approached to sell a cell site lease for Nextel or Sprint, and you have other cell site leases that you wish to sell- be careful about the contract you enter to sell the leases.
It has come to our attention that one of the largest lease purchase companies has entered into agreements to purchase multiple leases from a client of ours including a Nextel cell site lease and a Sprint cell site lease and is now backing out of purchasing one of those leases due to potential perceived risk from termination because of the Sprint/Nextel merger. I question how they weren't aware of this risk prior to signing the agreements to purchase the leases. I can assure you that the client would not have agreed to sell absent their committment to purchase both.
In essence, they are purchasing the cell site leases that have little or no risk- and keeping those that don't. The landowner gives up the most valuable cell site leases (those with nominal risk of termination)- and gets to keep the ones with the most risk.
This is a pretty one sided deal. If you are dealing with a similar offer to buy multiple leases-we suggest either selling all the leases or none. And get it in writing that during the due diligence period- they can only decide to buy them all or not.
If you have further questions about this topic- please see our webpage on
selling cell site leases.
AT&T Mistakenly Reduces Cell Phone Tower Lease Rent
AT&T (previously Cingular), through a lease optimization firm (either BlackDot or Md7), contacts a landowner with a cell phone tower lease with AT&T and requests that the owner reduce their rent. The landowner tells AT&T that they won't reduce the rent and does not agree to the proposed amendment to the cell phone tower lease. AT&T reduces the rent checks anyway.
The landowner calls AT&T via their landowner hotline and gets no response. The landowner sends a letter to AT&T- no response. The landowner retains an attorney and files suit for breach of lease- and AT&T finally responds through outside counsel alleging that it was a mistake. That this particular tower is very important to them and that they don't want to lose it.
Was it a mistake that the landowner did not get called back? Was it a mistake when AT&T failed to respond to the letter? In this case, it appears that the mistake was not a mistake until the landowner filed a lawsuit and AT&T was faced with possible termination of their cell phone tower lease. We have received calls/emails from AT&T or Cingular landowners who called the 1-800 landowner hotline which suggested that they leave a message to receive a return call- but never received one.
We don't know if AT&T chose not to answer the hotline or return calls because they received too many calls and could not handle them or if they simply felt that it would undermine the effectiveness of the
lease optimization project if landowners could actually talk to AT&T reps directly. Perhaps AT&T was simply too involved in its merger mania of late to concentrate on these issues. (for a hilarious history of the regulation and deregulation of AT&T - see
http://consumerist.com/consumer/colbert/stephen-colbert-explains-the-cingularattbellsouth-merger-229357.php?mail2=true) It is entirely possible that the landowners who contacted us were not representative and that other landowners did in fact reach AT&T. We have not heard of this particular mistake of reducing rent without an amendment occuring on other cell phone tower sites.
We have been contacted and retained by some landowner who had their cell phone tower lease terminated by AT&T/Cingular, only to be contacted again by Cingular who alleged that the termination was a mistake. In those situations- it became a mistake when Cingular determined that if they bundled their terminated cell phone towers together and included even the empty ones- that someone was bound to buy them. (See our last post for more details on that.)
Global Tower Parters Appears to have purchased AT&T Decommissioned Cell Towers
One of our clients received a letter from AT&T Mobility,
LLC regarding the AT&T cell tower that stated that Global Towers,
LLC - (Global Tower Partners or
GTP) had acquired the tower in a transaction dated May 04, 2007.
We had heard previously that AT&T Mobility was offering the cell towers that they intended to decommission (between 400 to 700 actual towers) to the tower companies. These towers are typically towers where AT&T and
Cingular had duplication in their network and no longer needed both sites. This was clearly the case here as this was a
Cingular tower that was adjacent to a AT&T cell site mounted on a Sprint tower. Please note that the actual number of cell sites that AT&T/
Cingular will terminate is
definitely greater than 400-700- these were only the towers.
This portfolio is allegedly
cashflow negative- meaning that it brings in less than the expense of operating the sites. AT&T Mobility wisely felt that they could sell these sites rather than decommission them. As there has not been an announcement by Global Towers of this purchase, we don't know whether they purchased a portion of the towers or all of the towers. Depending upon the geographic distribution of the towers- this could be a good acquisition for Global Tower Partners. Only time (and actual lease up or lack thereof) will tell.
