Steel in the Air, INC.

Cell Site Lease Terminations | Steel in the Air / HOME

Cell Site Lease Terminations

Many landowners like you are starting to receive "Pre-termination" letters from Black Dot Wireless on behalf of Cingular. The basic framework of the letters goes something like this:

• "Your site has been identified as one slated for termination. We would like to stop paying any rent we owe you for a two-year period. In return we will market your site to other wireless carriers and other potential tenants like WiMAX providers. If we are successful in finding a new tenant, we will pay you the current rent plus 10%. If we are unsuccessful, then at the end of two years, the lease will terminate and we have no further obligations, including those in the lease"

Black Dot makes the offer sound quite attractive. While you are losing the Cingular lease rate, they make a bad situation good by promising hundreds of thousands of dollars in future income. Black Dot sites countless articles showing that WiMAX is replacing cell towers and that it will be a boon for the tower business; the implication being that you stand a good chance of leasing your rooftop space or property to another tenant.

However, what they don't tell you is much more important:

1. If you sign the amendment as provided and they are unsuccessful in marketing your site, you are responsible for removing the tower or the worthless equipment/shelter they leave behind. This could total $50,000 or more. Ask them about removing their equipment at the end of the two-year period and see what they say.
2. If they do find another tenant, they can double the revenue you're currently getting and then pay you a measly 10% increase.
3. If you have a good property or tower site, another tenant will find you anyway -- with or without their help. Ask yourself why Black Dot can find a tenant when for 15 years, no one else has approached you. When our experts search for new cell site locations, the first thing we do is identify existing sites because the owner is already knowledgeable and interested in cell site lease income.

So why do we make this information available to you on our website instead of charging consulting fee? Simple: We don't believe in charging money to tell you, "yes, you are in fact losing your lease revenue - and by the way -- Cingular is trying to stick you with the expense of removing their equipment." Furthermore, we just don't agree with what Cingular is doing.

Feel free to drop us a line if you found this article helpful. We love to hear from you. Just mention if you received a cell site lease termination letter.