Water Tower leasing/installs

[TheHox]

I was going to post this on that other forum.. but I know sirhc is on a lot of water towers so maybe you can chime in too?

I serve a dense area in a small footprint, and I finally have the city ready to work with me getting on the water tower, the problem is, "they/the city manager/attorney" think the spot is worth $1,200 to $3,000 a month. (FYI the city is small, we only have 1 water tower, pop around 10k)

Sprint and Nextel were both on the water tower separately, but they have since merged and left the upper mounts empty. So there is a full cell mount open, with nobody using it, they even have a nice big building that is vacant.
ATT/US Cellular/Verizon and Sprint already have towers in this city, I do not see anyone else coming in to pay that price. (T-mobile maybe? doubt it)

After months and months of me pestering them, they finally got back to me today with some better news. They still want $1,200/m to lock in a secure lease.. BUT...
They will lease space to me at a discounted rate ($300-$600/m), as currently it is empty, and any money is better than no money. The only terms they state is that at some point if a big player comes in and offers them what they are asking ($1,200 or more) I will be forced to vacate the water tower.

I asked if that were to happen, before I vacate, would I then have the option to commit to their asking price. His response was, "Yes, You would have the option to match their offer". aka they start the bidding war, and I get forced to bid against a large carrier?!


Thoughts? I had a few ideas.

I really want the water tower, their discounted rate would allow me to get on now, and grow my coverage area, get that tower operating in the $green. Maybe after a year, or two, I could go back to them, and cave in to their asking price, or close to it, in order to secure my place so I can sleep at night and not worry about getting the boot? But, do I really want to pay $1,200/m? or even $1k/m? Maybe in two years, if they see that nobody has inquired about it, they would accept a reasonable offer from me, to lock in my price and remove the language about me having to vacate to a higher offer..


Or, do I just roll the dice, and take the cheap rate as long as I can. I personally doubt nobody else will come in and offer a high price for it, but, what do i know.. It has been only half leased for about a year now, with nobody else asking besides me.

[sirhc]

Yea, townships get a taste of that cellar money and they get spoiled. I am having a couple issues with Akron Borough on an existing tanks.

I would NEVER sign a lease that does not lock you in for at least 5 preferably 10 years as you will have contracts with your customers that you are liable for.

Try offering them a starting monthly rate say $600 that goes up each year so much so that at the end of 10 years you are at $1,000 to $1,200 per month that way you can build your customer base to pay the high tank rent.

[Zerofail]

Seems like they already started caving - they went from a NO to a OK, UNTIL SOMETHING BETTER COMES ALONG.

I would offer them $500 WITH a 5 year term + 2 renewals. Let them sit for a while, they will come back to you with some kind of counter offer, then just tell them that your offer is final but that you will add a 5% annual increase. Then let them sit some more...

The art of negotiating is all about patience :)

[Zerofail]

Hum - sorry about the double post, not sure how I pulled this off :(

[wtm]

You might sweeten the pot, by throwing in some Internet service to them?

The problem you have, by what you are stating is that a year from now, the city could come back and demand the higher fee?
The other problem is that the cell fees are going to continue to climb. Might be $1500 now, but in a few years it will be $3000.

If you can't get a good contract for say 5-10 years at a rate you can live with, WALK AWAY !

Might be better to build your own tower?

[lligetfa]

Might be better to build your own tower?

Except you might be dealing with the same monopoly to get your permit/variance to erect a tower.

[rebelwireless]

How tall is the water tower? Generally speaking, you have 50' AGL before you need a permit, and also generally speaking if you want under <=75' it's very hard to be denied when filing for a permit. Local ordinances that block this have to be extremely specific in their justification for denials.

[lligetfa]

If the water tower is on flat land, then it is likely to be around 200 feet tall. Water pressure is .43 PSI per foot so a 200 foot tower provides 86 PSI. UPC dictates over 80 PSI needs a PRV so some municipalities may try to stay below that.

Getting a permit inside city limits for a tower that tall can be a daunting task. The NIMBY folks that want 5 bars on their phones but don't want to see towers made it so.

[TheHox]

Update:

I finally received a contract from the city on this water tower. The originally wanted $1,200/m for a full cell sector cluster.

Their new offer is starting at $400/m and going up $100/m per year for a 5 year contract, ending at $800/m for the 5th year. This is after I offered to give them a free wifi hotspot by our downtown/lake front area, which is where some weddings are held, meetings, the 4th of July fireworks, and the carnival etc. Nothing huge, probably cover it with 4 APs, which would all feed back to the water tower.

My WISP is about 2 years old now, I believe I should be doing better each year from here out, we are doing great now. I also get full access to an old cell phone sector mount, so 9 full poles, I also plan to have fiber brought to this tower.

[sirhc]

Sounds like a fair deal!