Globalh Tower Partners (GTP): Tower Company Profile
Global Tower Partners began operating in 2003 in Boca Raton, Florida, and rose to become the largest privately-owned tower company in the U.S. Its specialities include buying or leasing ground space and/ or rooftops for the development of cell towers and cell sites that are leased to wireless telecommunications carriers, broadcasters, and back-haul providers. GTP has also been instrumental in buying and building collocatable towers and managing cell sites for third parties.
The majority of GTP’s revenue comes from collocating space on its towers to wireless carriers. In the U.S., this revenue is mainly from the “Big Four” carriers: AT&T (25%), Sprint (17%), T-Mobile (16%), and Verizon (14%).
On September 6, 2013, American Tower Corporation announced the acquisition of Global Tower Partners for $4.8 billion. At the end of Q2 2013, GTP owned approximately 5,400 towers in the U.S., 500 towers in Costa Rica, and 9,000 rooftop sites, which significantly complements ATC’s cellular assets (22,600 towers and 9-10K rooftop site), specifically because GTP’s towers average 2 tenants each, as compared to AMT’s 2.5 tenants, but have the capacity for four. Because the towers have not reached capacity, they are ripe for carrier collocation, which ATC is serious about. ATC’s revenue from its operative collocation model grew by over 8% last year; the acquisition of the GTP towers will likely contribute to this rate, as will aggressive LTE deployments from the Big Four.
How will this affect landowners with GTP leases?
Ground Lease Expansions: In many cases, the collocation of additional tenants will require the expansion of ground leases, as more property will be required to house additional equipment. ATC will likely be contacting landowners to request the right to expand the lease footprint (the ground area upon which the tower is erected and equipment is installed). Landowners have the right to request increases in rental payments when the terms of their lease are modified.
Lease Extensions: Industry trends show that cellular leases that are closer to their expiration date are more valuable, so it’s in ATC’s best interest to renegotiate the lease terms in advance. In addition, when engaging in new cellular leases, their strategy is to implement long-term lease terms, between 30-50 years. They typically offer a nominal signing bonus and will sometimes offer to increase the rent going forward.
Lease Buyouts: In addition to tower assets, GTP owned over 800 third party cellular leases. Its lease buyout program has also been operative in purchasing ground leases from landowners. When the acquisition of GTP is finalized, we expect that American Tower Company will be motivated to contact leaseholders with buyout offers.
Steel in the Air is your trusted source in cell tower lease negotiations. We have seen thousands of proposals from tower owners and can help ready you for the playing field, answer all your questions and define what fair market value is on similar lease renegotiations. We can also caution you on tactics that ATC might employ to position the negotiations in their favor.
Please contact us to discuss any questions you might have about a proposal you have received from ATC/ GTP. The initial discussion is free and once we talk to you and understand your needs, we can advise you as to what the costs would be should you choose to retain our services. Unlike our competitors, we offer the flexibility of either a fixed fee consulting service or a contingency based service.
Tower companies often prefer to purchase leases outright in order to further diversify their portfolio of assets; however, they are not the only companies out there who are interested in buying cellular leases. Buyout companies do it for profit alone. The motivation of the buyer may or may not be of interest to you, but it will likely affect their final offer.
Industry dynamics (mergers, acquisitions and deployment of new technologies) play a large role in cell site lease agreements. Before accepting any lease termination as final, consult our partner, Cell Tower Attorney, to determine what rights, if any, the Lessee has to terminate your lease agreement.