SDC Capital Partners has committed to invest $50 million of equity capital in Arcadia Towers Group to assist with its wireless tower development and management for commercial, private, and municipal property owners.
“Having such a strong strategic and financial partner ensures we have the resources and longevity to serve our clients, especially municipalities and K-12 school districts in need of robust digital communications and content capabilities,” Sam Johnston, Arcadia’s co-founder and CEO, said. “5G technology is changing how we communicate with and educate students, meet safety protocols, and help local governments serve their communities.”
SDC’s investment will support Arcadia’s growth across four strategic initiatives: municipal and school district partnerships; acquisitions of existing tower assets; carrier build-to-suit services; and rooftop management for commercial real estate owners.
“SDC’s investment allows us to aggressively develop and acquire the wireless sites needed by our carrier-customers as they deploy new spectrum and densify their networks, to fulfill the promise of 5G technology,” Johnston said.
SDC is a global digital infrastructure investment firm with investments in data centers and fiber networks, as well as wireless infrastructure. Its investment in Arcadia marks a major transition for Arcadia as it shifts away from private equity to infrastructure funds. Two previous interactions of Arcadia were funded by Kern Whelan Capital.
“We’re pretty excited about that because it gives us a longer time horizon than traditional private equity, and a lower cost of capital,” Johnston said..
Arcadia Towers II sold off the last of its portfolio of towers at the end of 2019. Johnston took time during 2020, to think about the future and build the leadership team for the next iteration of the company.
“We knew we wanted scale,” Johnston said. “And we knew we wanted to be in the business longer term, it was very important for us because we had been through the build-and-sell cycles, and we thought it would be important for our customers as well to be a longer term player in the space.”
Arcadia represents SDC’s first investment in a tower platform company. In the Spring of 2019, SDC invested up to $100 million in Tilson to support the spin-out and capitalization of Tilson’s asset ownership affiliate, SQF, LLC.
SQF was formed to own and develop telecommunications assets in public rights-of-way throughout the United States and to be a pole owner and solutions provider for 5G. It is supported by Tilson’s real-estate entitlement, engineering, construction and operational capabilities. SQF provides customers with a range of infrastructure options, from single site design-build services to fully outsourced deployment and management nationwide.