On September 6, 2013, American Tower Corporation announced the acquisition of Global Tower Partners. Today, American Tower owns and operates over 34,000 sites in the United States, Mexico, Brazil, and India. The company was formed in 1995 as a unit of American Radio Systems, and was spun off from that company in 1998, when that company merged with CBS Corporation. About American TowerĪmerican Tower Corporation is a publicly held company that is a leading owner and operator of wireless and broadcast communications sites in North America, that is headquartered in the Boston, Massachusetts area.Īmerican Tower has local offices nationwide. We averaged a 302% immediate increase in rents in 2020. Remember, American Tower has experts working for them, shouldn’t you?Īmerican Tower’s top four (4) tenant by total revenue for 2019: The information above is based upon corporate filings that American Tower disclosed earlier this year and provides an interesting insight not only on American Tower’s overall business model, but to the value American Tower derives from leasing properties across the United States just like yours. Accordingly, American Tower has minimal risk with respect to the residual value of its leased assets. The Company structures its leases to include financial penalties if a tenant terminates the lease, which serve to disincentivize tenants from terminating the lease prior to the expiration of the lease term.Īmerican Tower typically has more than one tenant/wireless carrier on a site and, by performing ordinary course repair and maintenance work, can often lease a site, either through renewing existing agreements or leasing to new tenants, for periods beyond the existing tenant lease term. The leases also contain provisions that periodically increase the rent due, typically annually, based on a fixed escalation percentage or an inflationary index, or a combination of both. American Tower lease arrangements with wireless carriers vary depending upon the region and the industry of the tenant, and generally have initial non- cancellable terms of five to ten years with multiple renewal terms. American Tower’s profit margin growth is positively impacted by the addition of new tenants.Īmerican Tower leases space to wireless carriers, and property revenue is derived from leases of specifically-identified, physically distinct space on American Tower’s tower assets. As a result, leasing additional space to new tenants at American Tower sites provides significant incremental cash flow. In general, American Tower’s property segments’ selling, general, administrative and development expenses do not significantly increase as a result of adding tenants to its towers, and any such expenses associated with the leased land typically increase only modestly year-over-year. Some or all of these expenses American Tower passed through to their tenants, as well as property taxes, repairs and maintenance. 43% of American Tower’s ground leases have a final expiration date of 2029 and beyond.Īmerican Tower’s operating expenses included direct site level expenses and consisted primarily of ground rent and power and fuel costs. American Tower seeks to enter long-term ground leases, which typically have initial terms of approximately five to ten years with one or more automatic or exercisable renewal periods. Of American Tower’s 177,746 towers, as of Decemapproximately 90% were located on land which American Tower leases.
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