Glossary of Cell Site Lease Terms
Co-Location Fee - a fee to a landowner for the addition of another cell site carrier to an existing cell tower. The amount of the co-location fee and the nature of payment are set forth in the cell tower lease.
Commencement Date - the date when a cell site carrier is obligated to start paying rent under a cell tower lease. The commencement date may be a date certain (August 10, 2009) or it may be conditioned on an event such as a cell site carrier obtaining government approvals or the start of construction on the landowner’s property.
Condemnation - the process of taking private property for public use through the power of eminent domain. When private property is taken by the government, the landowner and cell site carrier are entitled to receive just compensation for the value of the property and the cell tower lease.
Due Diligence - A process performed by a cell site carrier to determine the physical condition, suitability and feasibility of a landowner’s property for cell phone purposes. This includes performing signal, topographical, geotechnical, structural and environmental testing, surveying and reviewing title on the property as well as obtaining all of the certificates, permits and other approvals that may be required by any Federal, State or Local government.
Effective Date - the date a cell tower lease is fully executed by a landowner and cell site carrier.
Holdover Tenant - a cell site carrier tenant that stays past the end of a cell tower lease term without the landowner’s permission. Depending on the jurisdiction, a holdover tenancy is typically treated as a periodic tenancy if the landlord accepts a rent payment for the leased premises after the expiration of the cell tower lease. A landowner may not accept rent for any holdover period and then seek to evict the holdover tenant.
Interference - any performance degradation, misinterpretation, or loss of information to a cell carrier’s radio communications system on a landowner’s property. This can be caused by (i) unwanted energy emissions, radiations, or inductions, or (ii) physical barriers including, but not limited to, walls, signage, metal frames or other structures. Interference does not include permissible interference as defined by the FCC.
Intermodulation Study - a study performed by cell site carriers to determine future as well as actual sources and levels of adverse interference to a cell site on a landowner’s property.
Lease Exhibit - a drawing attached to the back of a cell site lease that depicts the exact location of the cell tower installation on a landowner’s property.
Leased Premises - the specific portion of a landowner’s property leased by a cell site carrier for telecommunications purposes. The leased premises are identified on an exhibit to the cell tower lease.
Leasing Agent - a third party representative who approaches a landowner offering to lease a portion of his or her property on behalf of a cell site carrier such as Verizon, Cingular, or Sprint Nextel. Also known as “site acquisition specialists”, a leasing agent is very similar to a real estate broker.
Lease Buyout Agreement - an Agreement from a third party to a landowner for the purchase of all or a portion of the remaining years on a cell tower lease.
Memorandum of Agreement (MOA) - an agreement summarizing the basic terms and conditions of the cell tower lease that is recorded in the County Clerk’s office where the landowner’s property is located. The purpose of the MOA is to put all third parties on notice of the existence of the cell site lease.
Phase I Environmental Site Assessment - a test performed by a cell site carrier that includes a search of the public database of hazardous properties, a visual inspection of the subject and adjoining landowner’s properties by an environmental professional and research into the past use of those properties. Lenders often require a Phase I before granting mortgage loans for commercial, industrial or multi-family properties.
Phase II Environmental Site Assessment - a test performed by a cell site carrier that involves the testing or sampling of site materials (such as soil, water and building materials) on a landowner’s property. A Phase II is considered more invasive than a Phase I because it can identify subsurface conditions such as underground storage tanks, wetland areas and past spills which can result in soil and groundwater contamination.
Radiofrequency (RF) - constitutes part of the overall electromagnetic spectrum whose group of wavelengths are between the audio and light range. Cell phone communications systems use frequencies in the 800-900 megahertz (MHz) portion of the radiofrequency spectrum (frequencies formerly used for UHF-TV broadcasting), and transmitters in the Personal Communications Service (PCS) use frequencies in the range of 1850-1990 MHz.
Rent Escalation - an increase in the rental amount received by a landowner during the term of a cell tower lease. The amount of the rent escalation and the nature of payment are set forth in the cell tower lease.
Right of First Refusal - the right of a cell site carrier, during the term of the cell tower lease, to match any offer from a third-party to a landowner to purchase the cell tower lease, the leased premises and/or the landowner’s property.
Search Ring - a specific location which a cell site carrier has identified as a gap in cell phone coverage and where it would like to potentially lease a cell site. Search Rings are issued to leasing agents and are identified as concentric circles, as small as a city block or as large as a third of a mile depending on the location.
Site Acquisition Specialist - see definition of Leasing Agent.
Subordination and Non-Disturbance Agreement (SNDA) - an agreement requested by a cell site carrier that states that a cell tower lease is subordinate to any existing or future mortgage on the landowner’s property provided that the landowner’s lender agrees to honor the terms and conditions of the cell tower lease as long as the cell site carrier is not in default.
Survey - a location drawing of a landowner’s property and its boundaries. A cell site carrier typically requires a survey as part of its Due Diligence.