Any apartment owners hosting antennas for these special channels can command considerably more rent. Owners with existing antenna sites will be prime targets. Unfortunately, most apartment owners have not explored adapting their cell agreements to collect additional revenue. Many contracts limit apartment owners to a low rental rate for ten or 20 years – cell carriers can put up as many antennas as they like – sometimes without the building owner’s knowledge.

Apartment owners have options to get a piece of the action. Growth is driving the need for new antennas and equipment in existing telecom sites. They are filling up and cell companies need more antennas - a revenue opportunity for the building owner. This is a good time for landlords and managers to talk with the carriers about their site even if they are in a fixed long-term contract.

Shaw, Globalive, Mobilicity and others are all looking for new antenna space as well. Apartment owners are being approached to sign long term leases using agreements and rents provided by the cell carriers. But apartment owners may not receive a fair share of the future cell revenue. Owners tend to be less diligent for roof top leases than apartment leases because it is new revenue. However, rooftop leases should be negotiated with the same diligence and commercial lease terms that are found in apartment leases. If the apartment owner does not understand all the telecom terms, they should get help.

Most apartment owners try to find out what the market rent is for their cell site. Confidentiality clauses in many cell agreements mostly protect the cell carriers. They are reluctant to share specific rental and information with owners or have owners share information amongst themselves. Often owners need to contact outside antenna advisors for current market information. Each rental cell site is valuated by many factors but network location is key.

If a cell carrier has a mature location (typically more than four years) the carrier is usually eager to keep the site as networks and new networks are hard to configure. Capital costs to set up each site can be substantial. Getting new permits from cities can be difficult and involve public hearings.

On a mature site, the carrier will pay a premium for existing and new antennas rather than disrupt the network. Lease renewals need to incorporate these factors. Determining the FMV of an apartment cell site may require independent appraisals and firm negotiations. There is no public cell site rental rate database as with apartment properties. Imagine every apartment rental rate being kept confidential – that’s the cell business.

But cell agreements have liabilities as well. Apartment owners may be liable to litigation, criminal prosecution and fines of over $500 thousand in some provinces for RF safety violations. Antenna RF radiation can be specifically measured and danger levels and areas quantified. Federal Safety Code 6 regulations require the apartment owners to be sure their roof is safe after any changes to a cell site. Most apartment owners have no idea when or what changes cell companies make on their sites or the RF dangers on and projected from their rooftops. Cell provider indemnity clauses usually leave out “Duty to Defend” clauses so that apartment owners must cover all legal costs up front. The owner has the ultimate liability.

Other challenges can involve municipal permits that if not current can jeopardize apartment insurance coverage. Once an initial installation has been completed, some carriers don’t obtain permits for new antennas or site modifications. Under municipal laws, these permits are the apartment owner’s responsibility, not the cell carrier’s. Imagine if lightning hits an unapproved antenna on an apartment and makes it uninhabitable. The owner’s insurer may have grounds to reduce payout and the cell carrier’s coverage may only be a few million.

Apartment cell antennas can represent millions in new rent to the owner. As apartment management requires ongoing diligence and understanding – the same is true of rooftop cell antennas. The growth in the Canadian cell industry represents a new revenue opportunity. Properly advised apartment owners can enjoy significant income that goes straight to the bottom line and properly structured cell agreements can create income streams that grow with the industry’s profits and keep liabilities at a minimum.

Roy Bennet is the President of Antenna Management Corp.