Why do tower companies buy cell towers, if the lease can be terminated?

  1. Investing
  2. Why do tower companies buy cell towers, if the lease can be terminated?

When you buy cell towers, not collecting rent as an individual cell tower owner can make a big impact on finances. For most cell tower landlords, receiving rent is an all-or-nothing proposition: either they receive rent, or they don’t.

Tower Companies who Buy Cell Towers

buy cell towers

On the other hand, a Tower Company that is building a global portfolio of cell tower and rooftop leases has substantially larger recurring revenue to support them should a tenant decide to cancel the lease or not pay rent.

Leveraging Debt to Buy Cell Towers

Unlike individual landlords of one or a handful of cell tower locations, Tower Companies with a large portfolio can obtain infrastructure financing in order to acquire additional locations. Once a tower easement is in the tower company’s portfolio, they can leverage that as an asset to obtain additional financing. For this reason, the Tower Company can assume the risk of your cell site lease being terminated and is also able to pay a large, up-front lump sum for any future rent associated with the cell site on your property.

Ask a Question

Relevant Insights

Menu