Recent developments in the telecomunications industry are significantly impacting the future of existing cell site leases. Landlords are wise to be aware of the contents of their leases and ready to see changes coming in response to tenants' merger activity, site upgrades, and tower asset sales. Among other things, the changes in the industry are impacting the value of leases in ways we have not yet seen.
Another important development over the past year has been the acquisition by the tower industry of thousand of cell sites. Companies such as American Tower, SBA, and Crown Castle have been spending billions to secure sites once held by the cell companies. This results in a larger number of leases falling into the hands of a fewer number of tenants.
Our advice to clients and landlords impacted by these changes is to be ready when a letter from the tenant arrives with such news. First, read the entire lease and its amendments to be familiar with its terms. Second, don't assume anything. For example, a new tenant may wish to change the terms of the original lease via informal letter amendment. Read everything carefully and seek clarification if necessary. Failure to do so can result in changing the lease but not in the landlord's favor. It is common practice by large international corporate tenants to assume landlords are unfamiliar with these matters and take unfair advantage.