What does APWireless do?
If you have a mobile phone mast on your property, you probably receive rent on a monthly or perhaps yearly basis. APWireless is simply buying the right to receive your rent for a specific amount of time, after which you resume collecting rent. This transaction is known as a lease premium.
What is a lease premium?
A lease premium is an upfront payment based on the market value of your lease. This is an alternative form of receiving the rent obtained from your mast lease agreement. It does not in any way affect the ownership of the property, nor the rights that the operator has in the lease agreement.
What are the risks associated with my lease?
Operators look for ways to decrease their operational expenses. They do this through mergers, site sharing, improving technology, etc. This can result in two scenarios:
- Rent Reduction
Telecommunication networks are highly complex and change continually to accommodate technological advances and operating constraints. Due to the uncertainty of this market, landlords can lose their mobile phone mast leases. When operator consolidations occur, landlords of redundant masts and rooftop sites are at risk of receiving a termination letter. Almost all mobile phone mast site leases include a termination clause that allows operators to decommission any site with short notice.
Mobile phone operators are looking for ways to cut down operating expenses while gaining market share. They often do this through rent reductions of existing leases leaving landlords with an unexpected decrease in income.
What are the benefits of a lease premium?
- Be Secure
- Gain Control
- Earn More
A mobile phone mast lease premium completely eliminates the financial risks. If your mast site lease gets terminated during the lease premium period, you will keep the full amount.
By choosing a lease premium, you would gain the freedom to decide what you want to do with your money, instead of depending on your operator to keep paying you rent.
The long-term value of investing in your area of expertise, or in something that is important to you, can far outweigh the amount of rent you might receive from a telecoms site lease.
Wouldn’t I make more money by keeping the lease?
This depends of course on how you choose to use or invest the money and whether the telecoms operator obtains a future rent reduction or if the lease agreement is eventually terminated. Even if your mobile phone mast rent continues unchanged, the cash flow associated with your phone mast 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 point.
If my lease can be terminated, why do you want to buy it?
APWireless is building a global portfolio of site leases, and is therefore able to spread the risks across thousands of mobile phone mast sites. With its growing portfolio, APWireless generates revenue by collecting rent from mobile phone masts around the world and isn’t dependent on any one site.
Can telecoms operators terminate my lease at will?
Depending on the language in your lease agreement, operators can terminate the lease for many reasons, typically on between 3 and 12 months’ notice.
How much will APWireless pay?
The amount of the lease premium depends on the rent being received, the telecoms operators on your property, the terms of the lease agreement, the location, the duration of the lease period, and a number of other variables that make up our own risk assessment.
How does APWireless make money?
We seek a reasonable return on our investment for the risks associated with the leases we purchase, and only receive this return if the leases reach the full term of the premium period. Each year we know we will lose a percentage of sites in our portfolio due to mergers, consolidations, technology changes, etc. We lose money on sites that get decommissioned, but we offset these losses by expanding our global mobile phone mast site portfolio, adding additional operators or negotiating upgrades, modifications and expiring leases.
Is this transaction allowed within the terms of my lease agreement?
Mobile phone mast lease premiums are universally accepted and recognised by telecoms operators in every country where we do business, and the specific terms of the APWireless lease are recorded with the local land registry.
If I convert my lease to cash, will I still own the underlying property?
Yes. APWireless only purchases the rent specifically associated with your site. Furthermore, after the premium 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 premium transaction.
What happens if I sell my property after getting a premium?
You are free to sell your property without any restrictions and keep the money you received from the mobile phone mast lease premium in its entirety. Since the lease premium 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 phone mast site after the APWireless lease premium period is over.
How long will it take to receive my premium?
The lease premium process is straightforward, but how long it takes is largely dependent on how quickly you are able to provide the required documentation and whether there are any securities or mortgages on the property. Once we receive a valid, signed agreement from you, we will typically transfer the monies on completion. APWireless is wholly-owned and funded by Associated Partners, LP and KKR & Co., LP, one of the world’s leading private equity funds, with approximately $148 billion in assets under management.
What happens to my site once you acquire it?
After the lease premium transaction has closed and you have received your funds, we notify the telecoms operator(s) of the change of landlord. From that day forward until the end of the APWireless lease premium period, we deal with the telecoms operator(s) regarding financial management of the phone mast site. We will also coordinate with you if a site visit or major works are planned, or if additional operators show interest in coming on to your property.