An Intro To How Cell Phone Tower Property Lease Rates Are Determined

Leasing out a part of your property to a cell phone company for establishment of a cell phone tower can be a win-win scenario for all the parties involved in the transaction. As the owner of the property, you can create an additional income stream without any investment whatsoever. The property, which is an investment you have already made, will now be exploited to generate additional revenue for you.

The cell phone companies will be very happy because the newcomers will help it provide better services to customers and earn more profits. However, this transaction will be a good one for you only if you know how to charge the right cell phone tower property lease rates.

There have been instances where companies have setup towers by paying an annual rent of just $100. This may sound crazy but there have been instances where cell phone companies have successfully reduced rates to such a ridiculous extent. On the other hand, savvy property owners worked with the right intermediaries and ended up earning hundreds of thousand dollars a year.

Read ahead for an overview of some factors that determine the rates paid by cell phone tower companies.

Density of Population

If the new tower can help the company offer better services to 100,000 customers, then it is obvious that they would be prepared to pay a premium for setting up the tower in your property. On the other hand, if population density is very low, then you are unlikely to succeed in your attempt to charge a premium rate for establishment of the tower.

Rates in the Neighborhood

Many cell phone companies use this factor to lower rates demanded by the property owner. They point of that other towers in the vicinity of your house have been set up at a significantly lower rate. While this is a relevant factor, you should keep in mind that you need not accept a bad deal simply because your neighbor committed the mistake of doing so.

Property’s Age

If you are planning to lease space on your roof for the tower, then you can charge premium rate if your property is not very old. A newly-constructed property is unlikely to require modifications or reinforcements. This means the company can setup the tower at a lower cost, which should translate into higher rates for you.

As a property owner, the smartest option would be work with an expert who specializes in closing such deals with phone companies. This will ensure you don’t end up getting cheated into signing a deal with very low lease rates.

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