Wireless Lease Negotiations: Privileges, Not Rights

My law firm professionals and I have negotiated hundreds of leases, lease modifications, agreements, ordinances, etc. over the years.  We repeated hear the wireless carriers talk about the ‘rights’ they must have.

Nope.  That’s not how it works for the savvy landlord.

We advise clients (and just about anyone else who will listen) that the wireless carrier is negotiating for privileges, not rights.

For example,

  • The very valuable privilege to have a lease extend for 25 or more years;
  • The very valuable privilege to deny the landlord virtually any means to get out of the lease;
  • The very valuable privilege for the carrier to get out of the lease on 30 to 60 days’ notice;
  • The very valuable privilege to take hundreds or thousands of square feet of land for sucker rents of as little as 10¢ per square foot;
  • The very valuable privilege to suspend rent for some casualty, even when the casualty is the due to the carrier;
  • The very valuable privilege to impose great duties on the landlord compared with those imposed on themselves; and
  • Many other valuable privileges that solely benefit the wireless carrier, most commonly to the detriment of the landlord.

You get the idea…the boilerplate deals offered by carriers are hardly equal or fair to landlords.  That’s a great reason to use an attorney who knows where the obvious (and the hidden) landmines are to be found in the documents, but I digress.

With the privileges the carrier seeks come payments to the landlord.  The greater the bundle of privileges, the greater the payment to the landlord for granting those privileges.

Only when the lease is executed do the privileges convert to rights. Not one second sooner!

Landlords negotiating with the carrier’s agent (and all the better if the landlord has competent legal counsel helping…ahem…) should carefully listen for the words and phrases ‘rights’ or ‘we need’ or ‘we must have’ when uttered by the negotiator for the carrier.  Every time that those words and phrases rear their ugly heads…and that will happy often…remind the rep that they are negotiating for privileges, which only convert to rights when the deal is done, fully valued, and the paperwork is fully executed.

The skill and mindset of the landlord’s negotiator for a cell site lease most often makes a huge difference in the result and value produced for the landlord.

We know that. Now you do, too.



Cell Co. to Potential Landlord: Use an Attorney and You’ll Regret It.

I’m simply amazed by many of the tactics used by wireless carrier agents (and therefore condoned by the carrier masters).

Most recently, carrier agents for several big wireless carriers have starting telling potential cell site landlords that if those potential landlords retain the services of outside counsel to help negotiate the lease, there will be financial consequences.  Sometimes the threat is the loss of a paltry signing bonus.  Sometimes its reduction in the proposed monthly rent.

What strikes me about such threats is how two-faced they are.  I know of exactly zero—zilch—nada— wireless firms that enter into lease without having their own attorneys review the documents first.

I tell clients that hear these threats that they should be even more cautious about entering into leases.  The stock leases promoted by wireless carriers are, not surprisingly, aimed at grabbing as much as they can from the landlord while paying as little as possible for those grabs.  Given that the leases usually run from 20 to 30 years* a landlord making a mistake or missing some well-hidden key point at the lease inception will haunt the landlord for decades.

Duck away from the sucker punch: If the carrier’s agent makes a veiled or direct threat in response to your decision to retain outside counsel, trust your gut.  Someone who doesn’t want you to use an attorney has a very good reason for that, and it’s not because they want to do you a favor.

Caveat Locatorem.

*One wireless tower firm now claims that their standard lease is 100 years in duration.  My response: If that’s that case, we’re going to put even greater limits on what they can do at the property.  Their response: Either silence or sucking sounds.

Sean Scully Comes Back to the Government Side

Welcome back to the government side of the planning counter, Sean Scully, as the new Planning Manager at the City of Redondo Beach, California.

After some time away ‘on the other side’ (no, I won’t call it the dark side) working for the wireless industry, Sean returns to his roots working for local governments.  In the past Sean worked for the counties of Riverside, Santa Barbara and Monterey, as well as the cities of Carson, Menlo Park, and Lawndale.

Best of luck in your new position at the City of Redondo Beach.