Crown Castle/ AT&T news
Do you have a Crown Castle/AT&T Site?
Crown Castle (CCI) is currently trying to mitigate the negative margin sites using various methods. They are:
- Rent reduction
- Lump sum Lease buyout
- Monthly lease payments using an over-lease/perpetual easement.
Sites where CCI can’t mitigate their losses will be moved to the Relocation Department to determine if AT&T can migrate to another existing tower or build a new tower in a nearby location.
The following is a link to the news release of October 20, 2013 announcing Crown Castle acquiring 9,700 towers from ATT for $4.2 billion: https://investor.crowncastle.com/news-releases/news-release-details/crown-castle-announces-485-billion-att-tower-transaction
The 3rd paragraph of the press release provides the financial structure for all 9,700 towers, which redacted is a 10-year lease with rent in the amount of $1,900.00 per month and a 2% annual escalation. The deal was not based on rents paid to Landlords for individual towers.
This means regardless what rent the landlord receives for a CCI/AT&T ground rent, the aforementioned economics are applicable to every tower. In 2013, this created 3 types of lease models for CCI.
- Above margin sites is where AT&T is paying rent to CCI and the rent CCI pays to the LL is significantly less. Those sites would be $300.00 to $600.00 per month.
- Median margin sites is where AT&T is paying rent to CCI and the rent CCI pays to the LL is still profitable. Those sites would be $600.00 to $1,300.00 per month.
- A negative margin site is any ground lease where the monthly rent exceeds $1,900.00 per month.
If you have been contacted by Crown Castle, AT&T or a third party to renegotiate the current lease economics, please call us today 844-624-7483!