By Hugh D. Odom
Generating additional revenue is (and should be!) a goal for every self-storage operator. Getting a cell tower on your property and leasing space to a wireless carrier can increase your bottom line—not only for the short term but for long-term gain.
Self-storage professionals understand that many of their customers rent storage space as a temporary solution to achieve a long-term goal. For example, a family stores furniture while their new home is under construction; a newly engaged couple goes through the process of purging and merging personal belongings in preparation for sharing an apartment; or a business owner needs a place for inventory while his enterprise grows. The common theme? Planning for the future with intentionality.
When a customer rents with you, he anticipates that someone will administer the paperwork and facilitate the rental process; but more important, he needs a transitional consultant, someone who will provide support, and has the experience and expertise to help him through the procedure. For example, he needs to know about the facility’s policies, the potential hazards of storing, the rental agreement and any available add-on services, such as tenant insurance. The customer will choose the best storage facility based on the value of the service and the operator’s ability to meet all these expectations.
When it comes time for you to consider adding a cell tower to your property, put yourself in your customer’s shoes. When signing a new or existing lease, or a lease-buyout agreement, you need to be able to navigate this process and understand the terms. It’s essential that you feel confident that any lease reflects your best interests and those of your business. Additionally, you want to ensure you’re getting not only the most money but the best agreement for the short and long term.
Unless you’re an expert with years of experience in the telecom industry, navigating the cell-tower negotiation process can be incredibly challenging. Here’s some guidance for choosing the best transitional consultant to assist.
What a Consultant Should Do for You
The most effective cell-tower lease consultants will provide assistance by doing the following:
Give you the tools and resources to make informed decisions. It’s impossible to proceed on the journey without an accurate map. A consultant should be able to provide information about any cell-tower lease transaction. Being equipped with knowledge about the leasing process and an understanding of the key agreement terms will help you level the playing field between you and the cell-tower company.
Ensure you have the appropriate resources to navigate. If you don’t know the rules of the road, you need a professional who does. Knowledge is power. By having a thorough understanding of how each aspect of a cell-tower transaction—financial, legal, development, etc.—affects the end result, you’ll have a solid foundation from which to steer through the process.
Provide the lease framework so you’re not leaving money on the table or unknowingly putting yourself and your property at risk. Your consultant should take actions to ensure your core asset is protected and achieving maximum rent.
The Value of Your Space
Cell-tower companies believe self-storage operators should be satisfied to simply receive a monthly check. However, the lease agreement should be structured to track the value of the company’s use of your property throughout the entire 20- to 25-year term. Unlike renting self-storage units, you’re not leasing space to the tower company. You’re leasing the value of the space, from which the tower company is benefitting.
Making a poor decision in regard to a cell-tower lease can result in the loss of hundreds of thousands of dollars over the life of that lease and possibly reduce the value of your self-storage facility. Although you may only use a small portion of your property for the tower, a lease is a long-term commitment that can have a big impact on the overall operation. Take the necessary precautions to ensure the lease terms won’t limit or potentially control the use of your property.
A cell-tower lease is an important negotiation that shouldn’t be taken lightly. It’s essential to find an experienced professional who has the expertise to secure the right deal for you today and for the future.
Hugh D. Odom is the president and founder of Vertical Consultants, a telecommunications-consulting firm currently working with approximately 4,000 self-storage facilities across North America. The company achieved a 338 percent average immediate increase in rents for clients in 2015. Mr. Odom has more than 20 years of legal and telecom experience, including representing AT&T as an attorney for more than 10 years. For more information, call 877.456.7552; visit www.vertical-consultants.com.