How to Create a New Revenue Stream for Your Property

[Julio Gonzalez]

The past two years have been a bit of a struggle for commercial and multi-family property owners when it comes to vacancies, late payments and new regulations. One of the main strategies that I implemented in my own real estate business was to create a brand new revenue stream for my properties. I did that by leasing out the rooftops of these properties to 5G cellular companies where they install 5G transmitters.

5G technology is different from previous generations of technology in that it utilizes a large number of transmission points at a lower elevation compared to the previous tall towers. An ideal building for 5G leasing is a 4-5 story building with a flat roof. Carriers have been scrambling to find buildings to install these transmitters as 5G is growing so rapidly due to the fact that it can transmit 100 times the data in comparison to 4G.

So I’m sure you’re wondering how much money you can make. The answer is anywhere from $2,000 - $20,000 per year with a contract term of 10-20 years. Better yet, if negotiated correctly, you could have leases with multiple carriers on the same rooftop, significantly increasing your revenue stream. An added bonus of these leases is that they are extremely low maintenance and generate passive income for years to come.

On top of the revenue from the lease, there are also multiple other added benefits for property owners such as increased cybersecurity for the building, high quality wireless improvement, lower operating costs based on gained efficiencies and higher rents. 5G is seen as an amenity to your tenants.

So how does the process work? You find a company to work with that has experience in this industry and does all of the contracting for you. After you sign the agreement, you’ll learn if your building is suitable for 5G carriers within 10 days. Carriers will be contacted for immediate interest and if there isn’t any, your property is kept in a system where carriers will see your location as an ongoing opportunity. The company will negotiate your lease with the carrier and once drafted, will first present it to you for approval. The company should then manage your rooftop preparation process such as getting permits, any construction and the execution of the rooftop equipment. The cash is managed by this company and is held in a trust account where the cash is distributed after 14 days. Your property will continue to be marketed to other carriers to try to get you multiple leases as well as upsell to your current leasee for additional space for their rooftop equipment.

One thing to be aware of when negotiating these contracts is to carefully read the language to ensure the lease doesn’t allow the major cellular carrier to sublease to other carriers allowing them to make a substantial profit. Your lease should be between you and the carrier with no subleasing and should ensure you are allowed to lease with multiple carriers for greater profit. Those are just two of the nuances when negotiating a 5G leasing contract, so be sure to utilize a company with lots of experience in this industry to make certain you are getting the most profitable deal. The company you choose shouldn’t make any money until you do. Make sure the fee they charge covers things such as the profile of your property, property analysis, construction of tower, utilities, carrier relations, taxes, negotiation of contract, carrier upselling, cash flow management as well as representation of the client (i.e. you). You should not have to pay any fees until your lease is secured and you’ve collected your first month of rent.

You might not be sitting on a gold mine, but maybe there’s one over your head!

Have you considered 5G rooftop leasing for your real estate property?