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New breed of firm out to make the hard cell.

The boom or bust world of cell phone technology is creating new breed of company which aims to help landlords get the most out of rooftop rental deals for cell phone towers.

Some 275,000 cell tower sites are located nationwide, according to industry sources. It is estimated that some 6,000 are within the five boroughs, with between 3,000 and 3,500 in Manhattan alone.

Average rent for cell tower sites in New York is $2,000. Prices have gone as high as $3,500 and as low as $1,500.

However, frequent consolidation among the cell phone firms, technological developments and other factors, often lead to the termination of rooftop rental deals. Indeed, cell phone companies allow themselves a 90-day termination clause in all contracts they sign in order to retain the right to end any contract.

Now, however,, companies, such as Unison Site Management are offering a lump sum of cash up front to buy out the remainder of leases from building owners renting out rooftop space for cell towers.

"[The companies] find there are risks and find towers are obsolete. When rent from the site goes away, the landlord ceases to receive revenue," said Mitch Kogen, managing director of Unison Site Management. "We own 1,000 sites. We take the risk and purchase the site for a lump sum of cash. We aggregate leases and the risk is spread out over a very large pool of assets."

Unison typically offers seven years of rent up front for the remainder of the landlord's lease. Leases are five years long with the option of renewing them up to four times.

Not only do landlords get paid upfront and avoid the risk of losing money, they also receive tax advantages. Because of the 1031 Exchange, landlords are able to take the money they receive for their lease and use it to reinvest, tax-free, in commercial property.

"The landlords are enjoying taking the money and putting it into something better," Kogen said. "They have plastic antennas on their roofs. They're better off selling them, buying a new building and putting the money into real estate."

Kogen added, "It all comes down to having control of your assets and we provide the landlord with control."
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Author:Razzano, Tiffany
Publication:Real Estate Weekly
Geographic Code:1U3IN
Date:Nov 30, 2005
Words:375
Previous Article:W. Village buildings fetch $30m.
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