Cell Tower Compensation for Subleasing
A sublease is when a tenant leases all or part of the property rented by him to a third party. In the case of a cell tower or a rooftop site lease, the sublease is a lease between the cell or wireless carrier on the tower or roof (tenant) and another wireless carrier or vendor (sub lessee). Many cell tower leases between the landowner and a tower company allow the tower company to sublease the tower to third parties.
Some leases allow for subleasing provided that the tenant notifies you in advance of the sublease. Some leases provide that the tenant must procure your consent before they sublease. In many cases though, the landowner is not entitled to revenue for consenting to or allowing a sublease. One thing is for sure: The tower company is not likely going to tell you if you are entitled to cell tower compensation for a sublease. In our years of experience, we've seen many instances in which the tower company sends a Letter Requesting Consent to Sublease to the landowner without indicating that the landowner is under no obligation to accept. If you sign the Letter of Consent, you may very well be giving up your rights to revenue that might be available from the sublease. If you fail to object, you may be waiving your rights to object to the sublease.
If you have questions about whether you are obligated to consent to a sublease, review your lease agreement and look for the Assignment and Sublease clause. This clause will indicate whether the tenant is allowed to sublease and if they must notify you or receive your consent before they do.
If the cell tower company is required to secure your consent prior to subleasing or if the lease area is not large enough for the necessary equipment, it would be common for you, the landowner to be compensated. This compensation might be for allowing the sublease or for the expansion of the lease area. Because every cell tower site is different and every sublease is different, cell tower compensation will vary greatly. Certain tenants may be worth much more than others. To further complicate matters, there are many different ways to compensate a landowner for consenting to a cellular tower sublease. They can range from a one-time payment to an ongoing monthly rental payment or a revenue share arrangement on a percentage basis. Steel in the Air's experts can review your location and help you decide which option is best for you.
Steel in the Air has assisted hundreds of landowners with sublease issues. Over the last four years, we've accumulated thousands of cell tower leases and developed a database of information that includes the location of the lease and whether there was cell tower compensation for subleasing. Furthermore, we've developed, owned, and built cell towers ourselves, so we understand the tower industry revenue model inside and out. Most of the time, we can provide you with an estimate of cell tower compensation including the proposed sublease by looking at pictures of the tower.
Legal Assistance with Cell Tower Compensation
If you need an attorney, our affiliated law firm, Cell Tower Attorney, can review your existing cell tower lease to determine whether or not the wireless carrier or tower company is entitled to sublease its premises.
A Word to the Wise
You should never feel pressured or otherwise obligated to extend your lease agreement just to receive cell tower compensation or sublease revenue. Furthermore, don't assume you must agree to a sublease agreement just because a cell tower company tells you so. Check with your attorney (or Cell Tower Attorney). If it's determined that you can demand compensation, please contact us to help you evaluate what your cell tower compensation rights are worth.