You know how much rent you are receiving from the carrier, but do you know how much it is worth? Rent rates vary greatly depending on your location; proximity to population concentrations, such as busy freeways, residential areas, and concentrated business centers; and how well you negotiated with the carrier / tower company. A carrier must spend money developing many sites surrounding your property (called a search ring) to find the best possible site given an engineering design. Each potential site must meet or pass:
- Zoning requirements. Commercial, boundary setbacks, noise abatement, neighborhood comments, public hearings, expert reviews, public safety, traffic impact, property value influence, aesthetic concerns, protected corridors, and more.
- FAA review on impact to flight paths for airplanes and helicopters.
- Available high-capacity power and high-speed data interconnects available to be brought to the site. For cell towers, drilling and trenching are often required to bring power and high-speed data to the tower location from distant off-site sources. If not, the carriers would have to spend upwards of $50,000 to test, engineer, build, and construct microwave communications paths on a minimum of two sites to carry data from your site back to to the switching operations.
- Environmental studies, EPA reviews, and hazardous material testing are made. Historical research is conducted on your site to see if it was ever used to store or manufacture hazardous chemicals.
- Your rooftop must be able to support heavy steel beam structures, telecom equipment, commercial battery packs, and other heavy equipment. Structural analysis, engineering, and reinforcements of your building may be required.
- Neighborhood effects, hearings, traffic assessments, parking availability for commercial equipment maintenance.
- Antennas not blocked by nearby buildings, trees, terrain, or reflective water surfaces.
- Earthquake, hurricane, seismic activity considerations and design requirements to make sure the sites can survive 100-year events.
These are only some of the fifty governmental and engineering requirements every cell site must pass to receive the necessary construction permits. Now that you know what happens behind the scenes to get your site qualified and that $500,000 was spent to get your site on-air, someone tells you that your site is likely going away? Based on the entire industry history in the past twenty-five years, it is unlikely that your site will be terminated.
There are generally two specific reasons why a carrier would want to terminate a cell site:
- duplication of sites due to mergers and acquisitions
- landlord bankruptcies
Additionally, urban settings command higher rents than rural areas because they have greater population concentrations, and zoning codes are more restrictive. The fact that your site is on-air and carrying cell phone traffic confirms that you have passed a series of improbable and important hurdles that had to be overcome by the carriers to bring the site on-air—“improbable” because most sites that are picked for cell site development do not pass stringent governmental, environmental, and engineering hurdles.
The greater the hurdle the carrier had to overcome, the greater the value your site is to them. Cell sites are needed to handle calls from one tower to another as the mobile user travels throughout the city.
Coverage Holes Must Be Avoided At All Costs
Turning off your site will create a coverage hole, resulting in dropped calls and “zero bar” frustrations that result in customer dissatisfaction and mobile plan deactivations. Carriers spend billions of dollars every year to advertise the supremacy of their networks, so they can’t afford to turn off sites on a whim because they need to reduce your rent by $100. With so much time, energy, and capital invested in getting your site on-air, carriers will not turn off your site without thorough internal reviews. Engineers are not motivated to recommend site terminations because their bonuses, performance ratings, and pure engineering pride are tied to their assigned areas performing well with as few coverage holes as possible.
Corporate is too far removed from individual cell site performance to dare recommend terminating sites at the local market level. To the contrary, corporate finance understands the real cost of getting one site on-air (remember that they had to develop several sites to get your one site on-air) and will question any recommendations to terminate site leases.
While we did not quantify the worth of your site in a single hard rent number, you can see that qualitatively your site is vitally important to the overall network performance of their wireless system design. Anyone telling you otherwise either doesn’t know about the inner workings of the engineering aspects of the cell sites, or they are being dishonest in communicating with you. If you need help, our specialists can be reached anytime. Just call the number above, or send us a message using the text box above.