A cell site is a cellular telephone site where antennas and wireless communications equipment have been installed, usually on a radio mast, tower, or another elevated place. This structure, sometimes called a “cell tower”, serves as part of a cellular network.
Frequently Asked Questions
Cell towers, flagpoles, rooftops, water tanks, smokestacks, grain silos, among others.
There are many specific reasons why cell site owners choose to sell their leases, but the primary reason is opportunity. The opportunity to take a lump sum of cash today and redeploy it for better use. The other major reason is to eliminate the risk of decommissioning, or uncertainty of receiving rents associated with an individual cell site lease.
Similar to the aggregation of mortgages or insurance policies, the process of pooling individual cellular sites into a large and diversified portfolio helps to offset the risk of loss inherent in individual cell sites. By creating a pool of cell site assets that include a variety of geographic locations, wireless tenants, and structure types like towers and rooftops, TowerPoint is able to offer investors exposure to wireless real estate at a significantly lower risk. The activity of pooling cell site leases is the foundational reason for why your ground lease may have value and liquidity.
Will selling my ground lease affect the ownership of my property and my ability to sell my property in the future?
TowerPoint is ultra-sensitive to the concerns of property owners, particularly when it comes to their real property ownership. Rest assured that our transaction allows you to maintain 100% ownership of your property and does not limit you from selling or refinancing your property.
Why might it be beneficial to get a lump sum today instead of keeping my current lease payments over time?
Due to the Time Value of Money (TVM), money can work harder for you when received as a large sum of cash now, rather than payments trickling in over time. Cash in hand today can rise substantially in value due to interest accrual and inflationary factors. This is why most lottery winners take the lump sum option, instead of spreading their winnings over yearly installments.
TowerPoint will cover all closing costs related to the transaction (excluding recording fees and transfer taxes in certain states).
TowerPoint strives to close all transactions quickly and efficiently. Typically, closings occur within 30-45 days of signing a letter of intent.
TowerPoint’s takes a holistic approach to site management and leverages their wealth of knowledge and experience generated over 15 years and 4,000+ transactions. When it comes to extracting maximum value from wireless real estate, knowing the right questions to ask and what to look for is critical. Without that knowledge, many cell site owners often find themselves guessing which path to take.
The tax treatment could be highly favorable to you. However, as with many tax questions, the answer is “it depends.” Typically, the transaction will qualify as a long-term capital gain and will be taxed at a substantially lower rate than ordinary income. Taxes may be deferred entirely through the use of a 1031 Exchange if you are purchasing another investment property. You should consult with a tax advisor for a determination specific to your transaction.
One of the primary reasons cell site owners choose a lease buyout with TowerPoint is to achieve a better tax treatment. Our transaction structures are designed to convert ordinary income tax into a long-term capital gain, saving property owners significant value at tax time. Many property owners have successfully executed traditional and reverse 1031 Tax Deferred Exchanges and utilized basis adjustments to further tax efficiency. TowerPoint is well versed in working with CPAs and tax advisors during the transaction process, to assist with tax treatment and drive optimal results
TowerPoint has been involved in many transactions where landlords have successfully executed a 1031 Exchange. We can refer you to a qualified intermediary with experience working on 1031 Exchanges involving long-term telecommunications easements (apiexchange.com).