A one-time payment for a cell tower lease can be tempting, particularly when it arrives as an unsolicited offer. TowerLeases.com, an independent consulting firm serving U.S. property owners, is explaining how buyout offers are typically built and why owners should understand the math, and the tax consequences, before they accept.
"A buyout is not a gift and it is not a standard price," said David Espinosa, founder of TowerLeases.com. "It is an investor's estimate of what your lease will pay over time, discounted to a number they are comfortable with. Different investors reach different numbers."
In general, cell tower lease buyouts reflect the income the lease is expected to produce. The current rent, the escalator, the remaining term and renewal options, the number of tenants on the site and the strength of the location all play a part. Each investor also has what the industry calls a sweet spot, a combination of carrier, geography, lease maturity and escalator schedule that it is actively looking to acquire.
That is why TowerLeases.com does not send a lease to every buyer at once. The firm identifies the investors whose criteria match the asset and manages the bidding among them, drawing on its network of more than 13 industry investors. The aim is to have the market value of the lease driven up by competition, not set by the first party that calls.
"The first number is almost never the best number," Espinosa said. "When investors know they are competing, the conversation changes."
Taxes belong in the discussion as well. A lump sum may be taxed as ordinary income or may qualify for long-term capital gains, depending on the circumstances, and some owners may be candidates for a 1031 exchange. Espinosa said TowerLeases.com helps owners frame those questions and guides them toward 1031 specialists, and he recommends they confirm the details with a qualified tax professional.
Some leases are harder to sell than others. A Right of First Refusal clause, known as a ROFR, leads many brokers to turn the owner away. TowerLeases.com takes those leases on and works with buyers equipped to handle them. It also helps when a lender is reluctant to sign a subordination, non-disturbance and attornment agreement, or SNDA, because some investors can proceed using a loan-to-value approval process.
"Selling can be the right answer for the right owner," Espinosa said. "But owners shouldn't be the last to learn what the lease is worth. Anyone considering cell tower lease buyouts should compare offers, not just accept the one that arrived first."
The firm begins with a free, no-obligation 30-minute consultation and then matches the owner to a strategy, which may be selling, renegotiating or keeping the lease. Property owners can request a consultation at https://towerleases.com/ or by calling 866-826-0510.
About TowerLeases.com
TowerLeases.com is an independent consulting firm that advises U.S. property owners on cell tower and rooftop leases, including negotiations, extensions, buyouts and new site agreements. Led by founder David Espinosa, the firm serves landowners, building owners, homeowners associations and municipalities nationwide. Learn more at https://towerleases.com/
Media Contact
Name
Tower Leases
Contact name
David Espinosa
Contact phone
866-826-0510
Contact address
30 N Gould Street, Suite R
City
Sheridan
State
WY
Zip
82801
Country
United States
Url
https://towerleases.com/