Towercos and carriers have most of the leverage in negotiating lease agreements with landowners, according to a presentation given by lawyers at the Virginia Farm Bureau Federation’s annual conference in Williamsburg, VA on November 29. Attorneys Mark Botkin and Kevin Rose, of the law firm BotkinRose, cautioned against contract pitfalls at the meeting, reported Lancaster Farming.
Rose said telecom companies are usually willing to work with landlords when negotiating a lease, to a point. “If you try to play too much hardball with them, they’ll just go to the next guy,” he said. “So, there’s not a lot of leverage, but there’s some.”
Landowners can expect to make between $900 and $1,000 in rent a month, Botkin said, and should build in “escalators” throughout the life of a contract, which typically ranges from five to 25 years.
Botkin cautioned property owners against agreeing to a restriction on the right to sell the land or the surrounding property. He also advised that landlords insist that their tenants carry insurance on the leased facility and that landowners are included on the policy as an additional insured party, reported Lancaster Farming. Additionally, Botkin and Rose discussed road maintenance, noting that since many towers carry equipment for multiple tenants, contracts should include what parties have access to the land and list ratios for costs of road repairs and improvements.
“If you enter into one of these leases with a cell company, you make them pay for everything so that the rent you receive for that land is a net figure,” Botkin said.
Property owners should ensure that there are no surprise costs to the owner after the contract is signed, including recordation fees, infrastructure maintenance and upkeep, and additional real estate taxes.
December 20, 2017