We are considering a proposal from Crown Castle International to extend a lease for a cell phone tower on our land. We have questions about several of the leasing terms that they are requiring for us to agree to in order to extend the lease contract. One of the terms gives them a right of first refusal. Will this affect us if we want to sell our land? Does this impact the value of the tower lease?
I never could understand why these other companies tried to buy our land lease when they knew of the ROFR. However I will say because of one of them, I was able to negotiate a much better deal with Verizon.
EDITOR'S NOTE: I smell a wireless shill.
Oct 12, 2013 Rating
Crown's ROFR - right of first refusal by: Tower Genius
Crown is actively extending leases they own or have purhcased recently from T-Mobile and they are trying to protect their investment by requiring landlords to give them a right of first refusal. I can completely understand Crown's position. They don't want to lose the lease to a third party lease buyout company or competitor who can jack their rent up and hold them hostage on a site.
With that being said, when you give Crown or any tower comapny or carrier a right of refusal, that is something of value. Can you purchase an option from your stockbroker for free? of course not, because it has a potential benefir and an option costs money. The problemis that the folks at the cariers and tower companies must think that they can get something for nothing in many cases. If you are going to give them the ROFR, then you need to get something in exchange for it because IT LOWERS THE SELLING PRICE IN THE EVENT THAT YOU WANT TO SELL THE CASH FLOW OF YOUR CELL TOWER LEASE TO A BUYOUT COMPANY.
Companies will not really fight over your lease if they know Crown will exercise their right. Will Crown's offer be aggressive? maybe... probably,,, but who knows. It depends on your cell tower's location and value.
If you have a lease extension or proposed amendment from Crown we can help you with the ROFR term and make sense of the other language they are proposing. Crown is generally a very good tenant to have long term, but they are in business to make money, and they are not going to tell you what they are willing or unwilling to do. Keep that in mind. Their reps are friendly but they are not here to get YOU the best deal but to get the best terms for CROWN.
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