Services

RENT REDUCTIONS, MAST REMOVALS & EQUIPMENT SHARING ATTEMPTS BY THE OPERATORS

Major changes are taking place across the country in the telecoms industry, and particularly in the mobile phone mast sector. The operators are restructuring their businesses and entering into various forms of infrastructure sharing arrangements with each other. The result is a reduction in the numbers of individual mast sites across the country. All landlords are likely to be affected in some way; those that lose their mobile phone mast tenant will clearly lose the rental income, but those whose masts are retained may well end up with two or even three tenants operating from one set of equipment and under one lease. This is an inevitable consequence of a maturing market but it need not be all bad news. In the vast majority of cases some financial benefit can be achieved for a landlord whatever the scenario and even in instances where the tenant is leaving. What is certain is that any deal offered or any veiled threat from the mobile phone mast operator tenant is almost certainly not the full picture, and should be taken at face value.

Depending on which mobile phone operator(s) you have on your property, you will have received correspondence from your tenant or will soon receive something from them, which will typically involve one or more of the following:

• Seeking your consent to assign their lease into joint names
• Seeking to terminate one of your leases and offering a sum of money to leave the equipment for you to either sell on or decommission yourself. This is a particularly dangerous and potentially costly scenario
• Seeking your consent or informing you that they will be sharing the site with one or more of their competitors
• Seeking your agreement to reduce the current passing rent otherwise you risk losing the site altogether. Some may take the view that less rent is better than none, but are they calling your bluff?

Never before has it been more important for landlords and their advisers to seek specialist professional advice to ensure there is a joined up approach to all tenant matters on the landlord’s side.