Property Owners: What You Need to Know About Cell Towers

In the past year alone, Varnum’s national representation on cell lease matters has included clients from New England to Hawaii. With our extensive experience, we offer the following general rules every property owner facing a cell lease issue should bear in mind. Our complete collection of cell tower advisories, which explores the considerations set forth below and other issues in greater detail, can be viewed here.

• If you are selling property with a cell tower or antenna on it, first sell the cell tower lease and future leasing rights. Done properly, this is “found money” which should not affect the sales price of the balance of the property. With cell tower leases selling at approximately 19 times annual revenues, this could bring in millions.
• If you are buying property that has a cell tower or antenna on it, have us look at the title work for lease or easement terms which may harm your use of the property. You may be paying too much, especially if the leased area has been sold off, the seller gets to keep all the rents under the lease and your use of the property is restricted.
• More generally, have us review cell tower leases, amendments and offers to buy leases/future leasing rights before you sign. Usually both (1) the rent/sales price can be improved and (2) harmful terms can be removed, such as those which may limit your future use and development of the property.

Our portfolio includes work on major projects, such as the $6.8 million sale of cell tower leases for a school district in a major U.S. city and the completion of documents by which one of the largest urban counties in the nation will lease multiple antenna sites to a cell tower management company on a revenue-sharing basis.

While we have the ability and experience to represent large clients in complicated deals, we more frequently help smaller property owners level the playing field in cell tower lease negotiations, securing better terms and rates for our clients. We represent businesses, developers, schools, churches, municipalities, real estate companies, condominiums and other property owners. Cell companies negotiate tower leases every day. Property owners need someone equally experienced on their side.

Varnum represents clients nationwide on cell tower leases, including on the sale of over 100 cell leases. If you would like to discuss an initial cell lease or retention, sale or renewal of an existing lease, please contact John Pestle or Peter Schmidt.

John Pestle is a telecommunications attorney who, for decades, has represented property owners, including municipalities, on cell tower leases and sales. He is a graduate of Harvard, Yale and the University of Michigan Law School and held an FCC license to work on radio, TV and ship radar transmitters.

Pete Schmidt is a real estate attorney who has represented clients on numerous cell lease sales, including the Detroit Public Schools on the sale of approximately 24 leases. He is a graduate of Albion College and the University of Wisconsin Law School.