Has a cellular service provider approached you about leasing your property for cell tower installation? If so, do you know how much your land is worth? Are you aware of other terms of the agreement that affect your ownership of the property?
Cell tower leases are probably the least familiar to the population when compared to other kinds of leases. For this reason, people end up committing to deals they wouldn’t have had they known the hidden terms in the lease agreement. Others lease their property for less than what it’s worth. You need to avoid these mishaps by understanding the following facts before renting your property to cell service providers.
1. Lease Rates Vary
Cell tower lease rates vary from one property to another. Since most people don’t understand how lucrative the cell tower lease market is, they rent their property for less than what they should get. Therefore, the worst mistake you can make is to consider prevailing market prices when setting your price. The chances are that your neighbor underpriced their property, and if you follow their trend, you will undervalue yours too. Carry out extensive research, and if possible, involve an expert—someone who knows the market can help you set an ideal price for the lease. Leasing property to cell service providers can be a very profitable business if you approach it wisely.
2. Don’t Settle for the Initial Offer
The initial offer that cell service providers approach you with will is usually at least 200% below the market price. That’s because they know that most property owners aren’t well acquainted with this business. Don’t settle for this offer no matter how lucrative it seems. Work with an expert so that they can help you research the market and set a suitable price. Imagine if you gave up $200 on your lease agreement. How much money would you lose over the lifetime of the lease? The answer is thousands of dollars. These companies can pay much more than what they initially give you; therefore, always counter the offer.
3. Secure Future Income
One thing that many property owners don’t know is that the land that cell service providers ask for is usually more than what they need to install their towers. They ask for more land so that they can sub-lease it in the future to upcoming providers and make money. Unfortunately, if your lease agreement didn’t have a provision for co-location rent (which most don’t), the company will make money off of your property without giving you a share of it. Avoid this by securing any future income that may be generated on your property. You are entitled to share in the revenue that’s made from sub-letting your property. Include such a clause in your agreement.
Leasing property for cell tower installation is a lucrative business, but many property owners don’t get much from such transactions due to lack of adequate information. Have these things in mind before leasing your property. Also, work with an expert so that they can help you value your land correctly and set cell tower lease rates that will give you high profits.
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