Do Cell Tower Lease Companies Pay Landowners Fairly?

With more than 200,000 cell towers posted around the US. by just the top three tower companies, coverage is getting better and better for consumers.

As demand increases every day, companies need to take up space in rural areas and dense urban regions. For property owners, cell tower leases can be a great way to rack up some extra passive income.

If you want to make some extra money with the unused space taken up by cell towers, here’s what you need to know about rates.

Get to Know How Rates Are Determined

Cell tower leases could pay out anything from $10 per month for small niche carriers to more than $10,000 a month with the larger companies.

Typical rental rates from a major management company could hit around $15,000 a month depending on location and space. If you’ve got lots of unused space on the ground or on top of a building you own, you could have a gold mine waiting to be tapped.

Demand for coverage is what really determines how much you can get paid. If you have a lot of space but very little demand for a certain provider, they won’t pay out a whole lot to get your space.

The density of users and a lack of reliable tower locations is what makes the difference in price.

It’s hard to tell exactly what a cell tower lease is worth.

Conventional wisdom might say that it’s up to the market to determine that. Some companies might try to tell you that prices are based on square feet. While that might be tempting to believe, in actuality, there is no real standard.

If you feel that a price you’re being offered is lower than it should be, reach out to other building owners to see what they’re getting for cell tower leases. These leases don’t fall under the wisdom of commercial real estate laws, meaning the space for them could cost as little or as much as you choose.

Other Factors That Determine Price

Beyond demand and density, there are a lot of other factors that determine the price of your lease. You’re up to the whims of the service provider in some cases while in others, you can call the shots.

If you live in a region where the topography is inconsistent, with lots of hills, mountains, and trees in the way, you could be offered a price you don’t like. Because providing coverage to that area will be a challenge, communications companies will want to offer you less.

Zoning restrictions can determine how much you end up getting offered. If there’s a limitation of how many cell towers you can have up or how tall they can be, you could be restricted.

If there’s a lot of competition nearby, you might also have a harder time. When all of your neighbors are making extra money leasing out their roofs, you could be left in the dust, having to take offers that are less than ideal.

There’s No Single Resource

Without an existing database to tell you what you could be asking for, you might feel lost in the dark. You could ask other people what the terms of their leases are, but that won’t guarantee you’ll get the same deal.

Rental prices change based on market saturation, how much growth is anticipated, and a whole range of issues that are based on data you’re not privy to however cell tower lease experts like David Espinosa can help you determine the most accurate rates in your area.

Cell tower leases are determined on a site by site basis. Different providers will have differing rent escalations per year. This is a percentage increase in prices that cell providers are willing to pay on every renewal of their contract or at the beginning of every calendar year.

If you sit at the edge of a high traffic interstate area or a dense city location, you will see that cell providers are willing to open up their wallets. If you’re in a lower coverage area, they will want to lower their potential spending since not many of their users will need service near you.

The Odds Are Stacked Against You

Wireless companies and cell providers often pay their leasing agents on commission. They’ll hand out a list of preferred prices they’re looking to pay for a given location and will reward their agents for talking the building owner down.

The terms that leasing agents want to agree with aren’t based on how well they’ll serve you. They’re going to want to do well for the tower companies and cell providers, whether negotiating lease terms, or cell tower lease buyouts.

Despite the fact that some people talk about prices “per square foot,” that’s not really how they’re calculated. Towers can build up, so why would you measure square footage?

When you factor in a one percent difference in your yearly rental increase, you could be talking about $150,000 to $200,000 over the course of a 25-year lease. If you have a three-carrier tower, you’re talking about a half a million dollars. If you don’t negotiate for as high of a rate as you can, you could be losing out big time in the long run.

You need to advocate for yourself to get the best deal.

Cell Tower Leases Provide Reliable Extra Income

If you’re thinking about signing some cell tower leases for your own properties, make sure you get long leases with fair annual increases.

That passive income could sustain your investments through thinner months or when you need some repairs to your building. It will add to the value of your buildings and keep income flowing in at all times.

Before you sign a cell tower lease, check out our guide for information on the tax consequences you could be facing 

The Advantages of Having a Cell Phone Tower on Your Property

Landowners

Who isn’t interested in making money without any effort at all? The next best thing to getting paid to watch Netflix, leasing a cell tower is a great way to earn passive income.

How does the process work? How much money can you make? And how do you get started?

Read on to learn more about the possibility of leasing a cell phone tower on your property and all the advantages it offers.

5. Better Coverage

You’ll enjoy a better signal on your mobile phone when you lease to the same cell company you use. Faster data and better call quality are great advantages to leasing, especially if you work from home.

Better coverage is only one of the benefits, though.

4. Less Downtime

If you’re a business, you’ll be able to get more work done. You have less downtime when you lease a tower, and this will drive your productivity way up.

This is also true if you work from home. Keeping up your workflow is easier with fewer interruptions in service.

3. No Investment

With most income-generating projects, you’re required to invest some capital before you start seeing profits. Yet a cell tower lease means no start-up costs for you.

You’ll start making money right away when you lease your property for a cell tower.

2. Blend With the Landscape

If you’re worried about the visual pollution that cell towers create, you needn’t worry. Concealed towers hide the utilitarian aesthetic of a cell tower.

By disguising a tower as a tree, or even using an existing tree, companies keep the beautiful landscape and boost the signal for their customers. Their creativity is your gain because you can keep the horizon you’re used to and make money by hosting a tower.

1. Best Advantage to A Cell Phone Tower On Your Property

The best advantage to hosting a cell tower at home is the extra income. You can make monthly fees, and possible long-term rental charges, if you continue to renew the lease.

The wide range of possible rates for hosting a cell tower on your property has many factors. The location of your property is one.

Where you are can affect the quality of the signal companies get from locating a tower on your land.

How much you can charge to lease a cell tower also depends on the landscape around you. If there are lots of obstacles to a signal, like mountains and hills, you won’t get a great offer.

Cell phone companies will have to put up more towers in that area, so they won’t be able to pay as much per tower.

Your property may have zoning problems with a cell tower, including height and appearance. If they have to keep their towers shorter because of zoning, companies won’t pay as much.

You can make anywhere from $10 a month to thousands, depending on the advantages and location of your property. Find out how much you could be making when you talk to one of our experts.

Ready to Lease

These are all great benefits you get when you lease to a cell company — better coverage, less downtime, no investment, and blending with the landscape. The best advantage, though, is the extra income.

If you want to make a passive income without any effort, a cell phone tower is a great way to do that.