Skilled Representation in Cell Tower Leasing

Simply stated, an easement is the legal right to use someone else’s property for a particular purpose. Cell tower and telecom companies have a vested interest in securing access to a cell tower site located on your property. To accomplish this, they will want a long-term easement that allows entry to the property whenever the company deems necessary.

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How Is an Assignment Different Than an Easement?

An assignment is an agreement under which the property owner agrees to assign certain of its landlord rights to the company for a particular term. This type of contract may be an option for a landowner who does not want an easement on the title record of the property. It may also be an alternative if the easement areas of the property cannot be easily identified. Not all cell tower companies will agree to an assignment.

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What Is the Difference Between a Fixed Easement and a Perpetual Easement?

The most favorable type of easement to grant to a cell tower or telecom company can depend on the location and value of the land and any future plans for it. Cell tower leases may involve fixed easements or perpetual easements.

  • Fixed easements are limited to a specified number of years and are often preferred by property owners. When the term of a fixed easement expires, it reverts to the original grantors (landowners) or their heirs. This frees up the property for development or estate planning purposes.
  • Cell tower companies often seek perpetual easements because they have no set time limit. Granting a perpetual easement can increase the amount you receive for the lease. It may be a good idea if the cell tower is located on raw land of low value that will not be developed in the future.

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How Does the IRS Characterize an Easement Under Code Section 1031?

A Section 1031 exchange allows taxpayers to relinquish a property and replace it with “like-kind” property, thereby deferring capital gains and avoiding capital gains taxes. To qualify, the property concerned must be held by the taxpayer for productive use in business or trade or held for investment purposes. Selling an easement underlying a cell tower site on a property creates an actual interest in the property. The courts have ruled that an easement and real property are of the same nature and character and qualify as “like-kind” property under Section 1031 of the IRS Code.

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Why Do You Need to Consult With an Experienced Colorado Cell Tower Attorney?

Every cell tower lease situation is unique. It is crucial to fully understand and skillfully negotiate the terms of a cell tower lease to protect your property interests. Lease forms presented by cell tower companies are typically one-sided to the detriment of the property owner. They are also lengthy and complicated legal documents.

Our Colorado cell tower lawyers have the knowledge and experience to carefully evaluate all factors involved in a cell tower lease, including projected use of the property, tax considerations, and our clients desires, to help determine the best solutions under the circumstances. We are familiar with the issues property owners should consider before entering a cell tower lease. These issues include easements, rent, use restrictions, building plans, indemnification, assignments and subletting, end-of-term cleanup responsibilities, and landlord remedies for tenant default.

Welsh Law, LLC was founded in 2008. Attorney Patrick F. Welsh is well-versed in wireless telecommunications law. We use our expertise to fight for our clients’ best interests in all legal matters. If you are entering into a cell tower lease, call us at (720) 836-1777 to schedule a free consultation.

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