What is APWireless buying exactly?
We are essentially buying the rights to receive telecom tower or rooftop antenna rent for a specified period of time with certain limited rights to ensure our ability to collect the rent.
How much will APWireless pay for my telecom tower lease?
The amount of the telecom tower lease prepayment depends on the rent being received, the carriers on your property, the terms of the lease agreement, the telecom tower or rooftop antenna location, the duration of the lease prepayment period, and a number of other variables that make up our own risk assessment.
Wouldn’t I make more money by keeping the telecom tower lease?
This depends on how you are using or investing the telecom tower rent and whether your mobile carrier tenants implements a reduction in the telco site rent and escalator, or worse terminates their lease agreement. Even if your telco site rent continues unchanged, the cash flow associated with your telecom tower lease will be distributed in small increments over a long period. In most cases, the comparison between receiving a lump sum amount today versus collecting smaller and uncertain incremental payments over a long-term period is the key decision. What you can do with a large amount of capital now can yield far better options and enjoyment compared to receiving smaller rental flows. Click here for potential investment scenarios.
What happens if the mobile carrier terminates the lease or stops paying rent?
You will keep the full amount of the up-front lump sum, even if the tenant terminates the lease agreement at any time during the telecom tower lease prepayment period. In other words, your lease prepayment unconditionally transfers the risk of termination to APWireless with “no strings attached.”
If my telecom tower lease agreement can be terminated, why do you want to buy it?
For most landlords, receiving telco site rent is an “all or nothing” proposition: either they receive rent, or they don’t. On the other hand, APWireless is building a portfolio of telecom tower and rooftop antenna leases in which a single telco site lease termination is far less consequential. For this reason, APWireless is able to assume the risk of your lease being terminated and pay a large, up-front lump sum for the future rent associated with your telco site. In addition, APWireless purchases future rent on a discounted basis reflecting the financial risk associated with potential telco site terminations.
Can carriers terminate my telecom tower lease agreement at will?
Depending on the language in your contract, carriers can terminate the lease agreement for many reasons, typically with only 30-90 days’ notice. For this reason, it is generally difficult to borrow against the lease at your local bank, and also why APWireless spreads the risk of your telecom tower being terminated across a large portfolio of telco sites.
Is this transaction allowed within the terms of my lease agreement?
Telecom tower lease prepayments are universally accepted and recognised by mobile carriers in every jurisdiction where we do business, and the specific terms of the lease prepayment are recorded with the local land registry. In the event that your tenant has a “Right of First Refusal” clause in the lease agreement, the transaction may require approval but this generally isn’t necessary.
If I have multiple mobile carrier tenants, would a lease prepayment apply to all of them?
A telecom tower lease prepayment applies only to those leases which you choose to sell. Assuming your telco site leases meet our criteria, APWireless will make you a lease prepayment offer it will stand behind.
If I convert my telecom tower lease to cash, will I still own the underlying property?
Yes. APWireless only purchases the rent specifically associated with your telco site. Furthermore, after the telecom tower lease prepayment period has come to an end, the right to receive all rent will revert back to you – unless you choose to enter into another lease prepayment transaction.
What happens if I sell my property?
You are free to sell your property without any restrictions and keep the money you received from the telecom tower lease prepayment in its entirety. Since the lease prepayment transaction is recorded with the local land registry, our contract remains valid and transfers to the new property owner, along with any rents associated with the telco site after the lease prepayment period is over.
How long will it take to receive my lease prepayment?
The process is straightforward, but how long it takes is largely dependent on how quickly you are able to provide the required documentation. Once we receive a valid, signed agreement from you we will typically send you a cheque within 30 days.
How do I know APWireless can fund the transaction quickly?
APWireless is wholly-owned and funded by Associated Partners, LP and KKR & Co., LP. We also issued $115 million of 5-year notes for which we received a BBB securitisation rating, the highest in the telecommunications industry. This ensures our ability to execute and enables you to receive your lump sum payment quickly. Click here for news about KKR’s investment in APWireless.
How does APWireless make money?
We seek a reasonable return on our investment for the risks associated with the assets we purchase and only receive this return if the telecom tower leases reach the full term of the lease prepayment period. Each year we know we will lose a percentage of telco sites in our portfolio due to mergers, consolidations, technology changes, etc. We actually lose money on telco sites that get decommissioned, but we offset these losses by adding additional mobile carriers or negotiating upgrades, modifications and expiring lease agreements.
What happens to my telecom tower once you acquire it?
Generally, very little changes. After the lease prepayment transaction has closed and you have received your funds, we notify the mobile carrier(s) of the change of landlord. From that day forward until the end of the lease prepayment period, we deal with the carrier(s) regarding financial management of the telecom tower. We will also coordinate with you if a site visit or major works are planned, or if additional mobile carriers show interest in coming on to your property.
How do I get started?
APWireless will provide you with a no-obligation telecom tower lease appraisal to determine if your site qualifies for a lease prepayment. Email us or to speak directly with one of our telecommunications lease specialists, please call 1800 983 402.