Cell Tower Rent – what is it, and how does it work?

Rob Turner Rent

Rent is one of – if not ‘the’ – most important factors in a lease.  Without your agreement on the rent, there will not be a lease.

“Rent” is the money a tenant pays the landlord.  Rent is paid by the tenant for the privilege of using the landlord’s property.

This key lease term is essential for you to negotiate – it casts the ‘die’ (financial framework) for the rest of your lease.  Without proper attention to this critical financial term, you could leave tens of thousands of dollars on the table over the life of the lease.

In a well-negotiated cell tower lease, there are usually two components to rent: 1) base rent, and 2) additional rent (many times additional rent includes so-called ‘revenue share’ or ‘colocation revenue’).

This post will review base rent and we will follow up soon and share our perspective on additional rent.

Cell tower and rooftop antenna rent depend on many factors, including your property’s location (urban or rural) and the communication company’s need for cellular coverage in your property’s location (e.g., downtown Chicago with significant wireless traffic, or rural South Carolina with less-dense and more widespread geographical coverage).

Remember: Base rent is negotiable.

Two key factors to consider and address with the base rent are:

  • Beginning rent amount for first lease year; and
  • annual rent increases.

Tip:  Beware of so-called ‘market rent.’  Don’t let the tower companies and their site acquisition consultants lull you into accepting so-called ‘market rent.’  Each cell site is unique and the base rent should be priced accordingly.

Please contact us to discuss how our Team can help guide you through any questions.