|
|
Leases - Negotiating to protect telecommunication site owners' rights |
Radio communications equipment is often installed literally on a handshake, with site owners failing to appreciate not only the economic value of sites, but also the nature and extent of the legal risks to which they expose themselves. |
Site agreements for installing such equipment should be approached in the same manner as any long-term agreement for the occupation of property. Only some 140 carriers have statutory rights to install equipment and then only in limited conditions. |
While some operators have an expectation that access should be provided at minimal, if any, rent and may resist the introduction of formal agreements, others are only too keenly aware of the value of sites, and may rent something at a peppercorn rent to then sub-let at a handsome profit. The only true universal rule on rental levels is that operators will normally have a better idea of their value than the owner. |
Any agreement should specify equipment in detail or an owner may miss opportunities to reflect an increased value in rental - the rental value to the operator may be affected by the nature of the equipment installed. |
The circumstances of a site largely determine the appropriate form of site agreement: normally licences are for sites where supporting infrastructure such as a pole or tower is shared or where control of all or part of a property is given to a particular operator. Owners should ensure that they do not have to resolve disputes about interference between operators, or that an agreement's non-interference provisions compromise the primary uses of the property. |
Standard site agreements generally suffer from two fundamental defects. They strongly favour the operator with provisions which sometimes reverse the landlord/tenant obligations typically found in commercial leases - owners may, for example, give indemnities and warranties normally made by tenants. |
Second, they may not include rudimentary provisions expected in standard commercial leases addressing indemnities, assignment and sub-letting, or the sale or redevelopment of property. Check any site agreement against a standard lease check list to identify such missing provisions. |
Site agreements for mobile carrier infrastructure commonly have a five-year base term with four largely automatic extensions. As in any other long-term commercial arrangement, owners should have the right to require operators to relocate. The main issues here are the period of notice and payment of relocation costs. |
Carriers commonly seek to have the owner pay their relocation costs. One way to deal with this is to oblige the carrier to bear relocation costs but allow those costs to be offset against future rent. |
Make sure you consult us before signing any agreement over communications equipment on your property to ensure your rights are protected. |
