(Reprinted from the AGL Bulletin of January 17, 2012. You really should subscribe.)
Crown Castle International has acquired a portfolio of ground lease-related assets for $180 million in cash and the assumption of approximately $320 million of debt in a deal with Wireless Capital Partners (WCP).
“While it may appear that they [Crown Castle] are paying a ransom today to [acquire] these 2,300 leases, over the long term this portfolio purchase will bring greater stability to CCI’s site costs,” Wireless site landlord attorney Jonathan Kramer, told AGL Bulletin. “Over the near term, I expect to see more package purchases from the aggregators by the major tower companies, which are morphing into long-term real estate investment trusts.”
The portfolio includes approximately 2,300 ground lease-related assets, including more than 150 related to Crown Castle towers. The assets being acquired generate annual cash flow of approximately $42 million, with 80 percent generated from the big four carriers. The acquisition is expected to close in the first quarter of 2012.
“Given the deeply negative relationship between the aggregators and the tower companies, I wonder whether this deal will bar WCP from building a new portfolio of other Crown Castle sites and doing it to Crown Castle one more time,” Kramer said.
