What are the terms and lease rates for cell tower sites?
February 7, 2010 10:32 AM   Subscribe

What's the going rate and terms for leasing your land for a cell tower site and is there any ability to negotiate?

My uncle received word that a cell phone company is interested in constructing a cell tower on his land. In general, what sort of terms and lease rates should he expect? Also, does he have any say as to the footprint, placement or lease amount?
posted by webelieve2.0 to Technology (9 answers total)
I would imagine the answer depends on the location and the willingness of other landowners in the area to deal with the company.
posted by dfriedman at 10:34 AM on February 7, 2010

A little more detail: if the company solicits a bunch of neighbors in your uncle's area and none of them want to deal with the company but your uncle does, then he has more leverage with the company.

If, on the other hand, the company contacts a bunch of his neighbors and they all want to deal with the company then the uncle essentially has to take the terms of the deal as presented by the company.

Complicating factors in this analysis include whether the uncle is geographically isolated, on a large plot of land. If this is the case then the above doesn't apply.
posted by dfriedman at 10:49 AM on February 7, 2010

The landowner has all the "say" he wants, since he owns the land and this is not an eminent domain process. That said, the cell phone company probably has options, like putting the tower on the next hill owned by someone else. This involves a long term lease, permanent alterations to the land, perhaps an access road, etc. I would suggest finding someone experienced and savvy in this kind of negotiation to represent him and not try to deal with the cell phone company himself directly.

Here's an outfit that purports to offer such services; found via Google; I have no idea how reputable they are. They say they have the data you're looking for, but obviously you may have to pay them for it.
posted by beagle at 10:50 AM on February 7, 2010

We refer to this process as cell site acquisition (you may try Googling that). Basically the engineering team will identify a coverage need and pinpoint 3-5 locations that would be suitable in the general area to place a site. That is then passed on to a real estate team who will work to identify the owners and eventually the lease.

From a compensation standpoint most companies will want to provide a single lump sum payment for a long term lease (25 years or so). As stated above the amount will vary greatly based on availability. It probably starts at a few thousands and could go up significantly from there if there are limited site possibilities. I've also seen different provisions such as free service but those are pretty rare.

As always it's probably a good idea to talk with a lawyer with experience in the area although in my experience many landowners don't.
posted by Octoparrot at 11:05 AM on February 7, 2010

A previous question linked to a forum that looks like it has some good advice--you might try asking there.
posted by tellumo at 12:22 PM on February 7, 2010

From a negotiation point it would be useful for you to know whether you are just dealing with one company or with more than one. Certainly here in the UK there is an increasing tendency for cell phone companies to collaborate to pay for jointly-leased masts rather than each having their own sets. If more than one company wants to use the mast that should give your uncle scope to talk the rent up. Mast rental can pay pretty good rates for little return so I would second the idea of talking to lawyer or other specialist.
posted by rongorongo at 12:30 PM on February 7, 2010

A family friend has a cell tower on the far corner of their 80+ acre property and the yearly "rental" fee is enough to fully cover their yearly taxes, so probably around $3,000 - $5,000? This is in rural Kentucky.
posted by banannafish at 12:33 PM on February 7, 2010

You should figure out if you have room to negotiate by following some of the relevant advice above.

Also, their first offer is probably going to be crap and completely negotiable. After doing your research be careful not to push too far, but expect a first offer to be way low.
posted by pelham at 8:51 PM on February 7, 2010

A friend's father gets quite a bit- probably high five figures, to six figures, annually, but it's entirely property dependent. His land is in NW Arkansas. I believe you can negotiate, but it'll depend on factors such as closeness to local towns for things like power, how much they need to put a tower there, if there are other locations they can pursue, etc.
posted by questionsandanchors at 4:49 PM on February 8, 2010

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