Posted on 09/23/2015
By Kevin Zentmeyer, Product Marketing Manager
The revenue-generating capability of your towers is the primary factor in your tower company’s value. With multiple tenants on multiple towers, managing leases efficiently and accurately is critical to your success. However, tracking fuel consumption allocations, rent escalations, lease agreement exceptions and renewal dates can be nearly impossible when administering hundreds, if not thousands, of co-location leases. Missing a critical date is too high a price to risk by managing leases manually — on paper or in multiple disjointed systems.
In addition, other agreements such as ground leases must be tracked just as closely — not only to meet (and not over-pay on) lease terms, but also to adhere to revenue sharing obligations.
Automating lease management processes can help by improving the accuracy of your lease administration, speeding manual processes and improving visibility into your company’s financial data. Today’s infrastructure lifecycle management systems are specifically built to automate your lease administration processes and ensure that key lease agreement dates are recognized and addressed immediately.
Whether you are managing a tower lease agreement with a customer or a ground lease with a land owner, your system should allow you to extract all key terms of a master lease agreement or addendum — including exceptions, escalations, cost allocations and premiums for added MNO equipment — and pull them into a process workflow that automates each review and approval step, and notifies key employees of critical milestones. These capabilities help to ensure that negotiated clauses are enforced, and that you do not miss an opportunity to collect revenue as part of your lease agreements.
Here is an example: You may have a lease agreement that increases the fee for an element of the lease for your customer by three percent every year. Your system should allow you to enter all of the lease agreement details, including the three percent escalation, and notify your accounting department when the customer’s invoice needs to be modified. Another example: Some of your lease agreements may specify that you will allocate the cost of diesel fuel for certain tower generators across multiple tenants. Your system should allow you to set the parameters for this complex calculation and automatically determine the appropriate invoice amount and timing for each customer.
As with project management, one of the greatest benefits of housing all of your lease agreements in one system is visibility into space availability and revenue generated across all of your towers. What space do you have available on what towers? What is the capacity of your towers? What space is reserved? What will be the capacity five years from now? Your system should allow you to easily view both summary and detailed reports of current and projected revenue, opportunities to add MNO equipment, and other insights to help you get the most revenue from each tower.
To learn more about improving the market value of tower portfolios, click here for our free whitepaper.