Telecom operators drive hard for lower rents

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Few things are more crushing than closing what you think is a rather good deal on a rental agreement only to discover you could have got a lot more. When it comes to telecoms sites, the chances of being hoodwinked by silver-tongued agents acting on behalf of networks is currently very high, notes Chris Hicks, telecoms specialist with rural property surveyor Fisher German.

“A bitter battle over the airwaves and fierce competition between mobile companies mean farmers and landowners are coming under increasing pressure to accept poor deals for renting mobile phone sites,” he warns. “But it’s very unwise to enter any negotiation without experienced professional advice on your side.”

Fisher German is the leading company acting on behalf of landowners and farmers for telecoms mast sites and the NFU-recommended surveyors for telecoms work. “We have consistently achieved good deals for farmers in rent reviews, lease renewals, renegotiations and on new sites. We know the sector and have contacts in the industry, we talk the language and we have plenty of experience to show we know how much a site is worth this has helped us increase revenue by up to six times in some cases. And the pressure on networks to reduce their overheads has never been greater.”

Much of this stems from rollout of the troubled 3G network – the new generation of mobile phone technology bringing high speed internet access to your handset. Take-up has been lower than expected, while other, competing forms of wireless broadband, such as Wi-Fi and the forthcoming WiMAX technology, are proving a popular alternative. This means networks are looking for cost-saving efficiencies – Vodafone and Orange have recently announced plans to merge their respective networks, for example.

“Telecoms operators are pursuing their drive to cut costs and deliver improving value to their shareholders. They’ve just succeeded in delaying Ofcom’s approval of a rollout of competing technology, for example. So they will be pushing hard for rent reductions and good deals on sharing sites or upgrading masts to carry 3G equipment.” But farmers should stand firm, Mr Hicks advises. Land and property owners with existing Vodafone or Orange installations should be very wary of planned changes to their site which might help the merger of these two operators’ networks.

Consideration should be given as to whether the existing contractual obligations of the lease between the parties would be breached should a sharing of structures, equipment or indeed frequencies occur without the landlord’s consent. Quite often where the two wish to share a site, there may be the opportunity for landowners to negotiate an additional annual site share payment of up to 35%.

“Despite all sorts of stories you may hear to the contrary, mast sites carry a significant premium. Operators need them and they will pay the market price for them. The important thing is to get an experienced agent on your side,” concludes Mr Hicks.

Any NFU member who has been approached by a telecoms operator or believes their existing contract is due for renewal should contact Chris Hicks or Mark Newton on 01858 411246. chris.hicks@fishergerman.co.uk or mark.newton@fishergerman.co.uk.

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