When selling property with cell tower leases that will transfer, a seller can maximize the net profits they will make by either (a) completing a separate lease buyout or (b) providing a written Letter of Intent (LOI) from Wireless Equity Group to prospective buyers seeking to purchase property with cell tower leases in place.
Valuation of a Wireless Tower Lease
Too often real estate agents try to value cell tower leases based on cap rates; by doing so, the real estate agent is not doing a seller justice. Just like commercial real estate, there are many factors involved in the valuation of a cell tower. One very important factor is the end buyer.
Someone who is buying real estate with a cell tower lease attached to it who isn’t a tower company is likely going to only value the cell phone tower based on the current rents being collected. As many of the leases often include 30-day cancellation clauses, the added value this may have to a buyer can be far less than what an experienced cell tower company might pay.
A telecommunications or tower company will look more at the long-term valuations and opportunity to add additional carriers to the site. Our Tower Investors will base their valuation on future revenue, growth potential (population density and growth) etc. This can lead to valuations estimated at close to 18x annual rents collected.
Letter of Intent to Purchase a Cell Tower Lease
Now, you may have a property that could be a hard sell if it didn’t have income coming in from the current cell tower. This has become a common ideology, forcing many property owners in making a decision not to sell the tower separate from the real estate. However, a property owner can maximize the net sale value and provide additional incentives to a buyer by requesting a Letter of Intent to purchase a cell tower lease direct from Wireless Equity Group.
Benefits of an LOI when selling property with cell tower leases
The letter of intent (LOI) can be provided to a buyer showing them how much a tower company would pay for the current income on the tower. Our tower investors will also agree to close concurrently with a buyer and funds can be used to help with down payments, closing costs, or to reduce the purchase price of the real estate.
Selling real estate with a Cell Tower
Unlike most tower companies, our founders have over 20 years of real estate experience and may also be interested in purchasing real property. So, if you do decide to sell real estate with a cell tower, be sure to reach out to our team first as we can simplify the process and save you thousands in fees. Our real estate investment criteria require selling property with cell tower leases in place. Our target locations are California, Arizona, Idaho, Oregon, Utah, Montana, New Mexico, Nevada but we will purchase almost anywhere if there is upside potential. Contact our real estate acquisitions team at 858-295-3040 or request a free site valuation if you believe your property fits our criteria.
Selling property with tower leases that have been sold
Depending on who you sell your tower leases to, you are still free to sell your real property separately without any restrictions. When selling property with cell tower leases to our Tower Investors, you keep the money you received from the cell site lease buyout in its entirety.
Since the lease buyout transaction is recorded with the local county recorder’s office, our contract remains valid and transfers to the new property owner; along with the rights to any rents associated with the cell site after the lease buyout period is over.
