How can you maximise the profit from your telecoms mast site?

If you are a telecoms landlord, you will receive rent from mobile operators such as Vodafone, Meteor and Three Ireland for as long as your site facilitates their network needs.

APWireless partner with landlords to offer a financial alternative to your current arrangement. APWireless is the largest global lease prepayment company and has invested almost €500 million across 17 countries.

Examples of landlords with whom the company has partnered include: farmers and rural landlords; the hospitality industry; government bodies; semi-state companies; and property investors.

Experience has shown that APWireless’ clients consistently out-perform the telecoms rent and achieve security and higher returns by putting the company’s upfront lump-sum payment to better use.

One of the biggest benefits APWireless offers landlords is removing the risk of lease termination for them. Where operators choose to terminate a lease, the landlord suffers the loss of the rental income.

However, the main deciding factor as to why landlords deal with APWireless is usually their foresight in recognising the value in releasing idle equity from their lease agreements.

Reinvesting in assets that they own, fully control and which are not subject to termination is attractive. Landlords have used the company’s lease premium for a range of benefits.

Specific to the rural landlords investments have been made in:
  • Acquiring additional landholdings;
  • Slatted houses or upgrading milking parlours;
  • Plant and machinery;
  • Renewable energy systems;
  • Pensions;
  • Assisting family members with property purchases.

Divesting capital in this way is attractive when the associated risks with the telecoms market are fully considered.

Associated risks with the telecoms market:
  • Network sharing risk – consolidation of infrastructure and decommissioning of redundant sites;
  • Tenant credit risk – mobile operators going out of business;
  • Merger/acquisition risk – such as Three Ireland’s acquisition of Telefonica O2;
  • Technology risk – technology improvements rendering existing infrastructure redundant;
  • Rent reduction risk – to reduce operation costs, rent reductions continue globally.

Why does APWireless invest in what is an insecure asset?

The company’s business model works because of its scale. It spreads risk across a growing and diverse portfolio of 4,200 sites, both rural and urban, spanning 17 countries.

It is for this reason that APWireless is capable of absorbing inevitable losses to better effect than an individual telecoms landlord to whom the risk is binary (either they have the rent or they don’t).

APWireless takes on the benefit of receiving the rental income, but also the associated risks outlined above. However, it does not make a return on each individual site.

This is exemplified by the fact that APWireless has already lost 14 leasehold interests in Ireland alone since 2015. Neither APWireless or you as a telecoms landlord have control over the operator’s network plans into the future. And, APWireless knows that it will continue to lose more sites.

How does APWireless structure an agreement with you?

With the agreement, you remain a landlord and APWireless become a tenant of yours and the mobile operator becomes a subtenant of yours.

APWireless only lease the specific area where the equipment currently sits and it has no rights outside of the agreed demised area. The company does not add equipment or physically modify your site in anyway. Remember, the company is simply buying the rent.

In addition, site access remains unchanged and all of the equipment is still owned, operated and maintained by the existing mobile operators.

When the lease comes to an end, the telecoms rent reverts back to you should the site still be there. It really is a straightforward financial transaction that allows you to convert the license rental into an immediate lump sum; securing income in the here and now for your future.

As a brief exercise, ask yourself the following questions:
  • Are you receiving a fair market rental?
  • Have you experienced a rent reduction?
  • How do you deploy your rental income and is it being used effectively?
  • How can a substantial lump-sum payment benefit you, your family, your business or landholding?
  • What lease termination rights do the mobile operators hold?
  • Can you benefit from one of APWireless’ various lease structures to minimise taxation?

A farmer’s perspective

Farming in Nenagh, Co. Tipperary, Aiden McIntyre admitted that he was initially hesitant to sell. But, every concern that was holding him back was addressed.

He said: “My accountant advised the transaction to be a ‘no- brainer’ as I was securing capital in the here and now, which allowed me to reinvest in assets that I have full control over.

“Understanding the telecoms market more so now, I am very happy I made the right decision. I would highly recommend dealing with APWireless.”

How much can APWireless offer you?

APWireless conducts a review on your lease and informs you of the strengths, weaknesses, opportunities and threats for your site.

Along with assessing the market conditions for your specific area, APWireless also listens and seeks to identify your needs and tailors an offer specifically to suit you. There are a number of different structures to choose from.

Members of the APWireless team include: Eddie Joyce; Ronan Loughrey; and Linda Evans

Should your site qualify for investment, the company presents a formal written offer. To be clear, offers are based on your specific lease terms and not simply a multiple of your rent.

APWireless also liaises with your accountant and solicitor directly to ensure you are making a sound decision that benefits you. On completion of a transaction, money is paid to you immediately.

More information

To explore the full potential of your site and receive an offer, contact one of the APWireless team at: 091-457880. Click here for more information