If a telecommunications company wants to build a tower on my land, how much should I charge?


The question of how much to charge a telecommunications company for a lease that allows it to build a cell phone tower on land it owns is a difficult question to answer. Leasing rates can vary by thousands of dollars per month and depend on several factors.

Key takeaways

  • Leasing rates vary by thousands of dollars per month. A professional from a consulting firm can provide the best information in this regard.
  • Factors that determine a lease rate include the location of the site, its elevation, distance to other towers, whether there is a dense population or heavy traffic nearby, and local zoning ordinances.
  • If a company leases land, it can sublease the use of its towers to other providers. In this case, the lease must contain a clause stating that the owner will receive a percentage of the profits.

Understanding Lease Rates for Cell Phone Towers

The best advice for determining an appropriate lease rate is to contact a professional to help you determine the value of your land as a mobile phone tower lease site. A local professional will be able to tell you how much a telecommunications company is likely to be willing to pay for a lease.

The rapid and continuous expansion of cell phone service has increased the need for towers to provide adequate coverage. This growing demand for tower space from telecommunications companies has made leasing land or rooftops on private or commercial properties big business. There are consulting firms that specialize in advising property owners in this regard. In addition, there are attorneys with substantial experience in drawing up this type of land lease.

Some of the main factors that influence whether a hauler will lease your land and how much you can receive are listed below.

Location

As with most real estate transactions, location is an important factor in price. If you live in a sparsely populated rural area, there are many similar landlords that the telecommunications company can negotiate with. Therefore, the lease rate you can obtain will be considerably lower than the rate you would receive if your property is in or near a major metropolitan area.

Elevation

Mobile phone towers operate more efficiently at high altitudes, so much so that, in urban locations, telecommunications companies have even entered into rooftop leases with very high-roofed churches. If you own land on top of a high mountain, this can earn a premium.

Distance to adjacent towers

If there are other cell phone towers within a mile of your property, it is unlikely that a telecommunications company will build another one nearby. Local zoning jurisdictions require existing towers to be used first. However, if there are no towers nearby, you are more likely to be able to lease your land.

Dense population or high traffic counts

If your land is near an urban or suburban town with busy roads, your property is more likely to be leased. If your property is in a rural area and more than half a mile away from major cities or highways, it is unlikely that a telecommunications company will lease it.

Zoning

Counties, towns, and cities have zoning ordinances that allow communication towers. If your land is industrial but surrounded by residential property, a wireless service provider may want to lease your property.

Similarly, a hauler is less likely to use your land if it is divided into residential areas and surrounded by industrial property. Your local zoning or community development office can tell you if your land meets the requirements for a communications tower.

Special Considerations

Telecommunications companies often sublet the use of their towers to other providers. In this case, a clause in the lease must state that you will be paid a percentage (10% to 30%) of said agreement.

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Mark Holland

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