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Tower Collocation Leases

Tower collocation is where a wireless carrier installs or collocates their equipment on another carrier's or tower company's tower. The wireless carrier will lease ground space in the tower owner's lease area and will lease space on the tower for their antennas and coaxial cable.

A typical tower collocation lease is structured in one of two ways. First, a carrier leases each tower site individually and signs separate collocations leases for each location. Alternatively, a wireless carrier signs a master lease agreement with the tower company or wireless carrier which defines the terms and conditions upon which future individual leases will be agreed upon. The master lease can either specify the price and the lease terms or just the lease terms for future collocations. When the carrier wants to use a specific tower, they execute a site license agreement or site lease agreement which contains the specific information relevant to that location. For instance, the carrier may specify that they are allowed a certain number of antennas and a certain number of lines for a specific price. The price in the master lease agreement may be structured as a one-size-fits-all whereby the collocating carrier pays one price regardless of the number of antennas/lines, or it may be structured with a fee per number of antennas and lines.

The actual pricing varies depending upon a number of factors which include:

1. Size of the lease area required
2. Number and thickness of coaxial cables
3. Weight and size of antennas
4. Height of antennas (rad center)
5. Generator placement
6. Availability of space
7. Location
8. Escalation increases
9. Guaranteed term

However, in many cases, the pricing of these collocation leases is based upon the market knowledge of the participants and the number of sites being proposed to that tower company. Steel in the Air assists smaller companies that are unfamiliar with typical rate structures for tower collocation leases. We have amassed a sizeable database of tower collocation lease rates being paid by other wireless companies across the United States. We understand regional differences between the tower companies and their pricing structures. We also know which tower companies are "hungrier" and which are notoriously difficult to deal with. Certain wireless carriers and a few tower companies make it very difficult to proceed with the collocation process. Others make it very easy and efficient.

We can share our experience and provide consulting services on how you can reduce your tower collocation lease rates. We can recommend a strategy for negotiation based upon having worked either for or with the tower companies previously. If you consider that a savings of $100/mo yields $40,000 in savings across a 25 year lease with 3% annual escalation, it doesn't take much to justify the value of our services. We can also provide guidance on the contractual language in the master lease agreements and share with you what is customary and what is atypical through our partnership with Cell Tower Attorney. One of the partners of Cell Tower Attorney used to work for one of the carriers and was responsible for some of their master lease agreements. We can point out the pitfalls of the typical collocation lease.

For a recent client who was awarded broadband stimulus funds to develop an advanced wireless network, we assisted them with isolating tower locations where they could get favorable terms and conditions. We assisted with the negotiation of letters of intent including fiscal terms with the various tower companies and carriers. We helped them focus their efforts away from tower companies or wireless companies that weren't likely to get a lease done quickly so that they could meet their timeline for deployment. In short, we provided invaluable assistance and can do the same for you.

Please don't hesitate to contact us. We will gladly sign a Non-Disclosure Agreement with you before we talk so that you can discuss your plans in confidence.