Site Development Process #9- Space Rights Agreements
Site Development Process #9 Space Rights Agreements
Negotiate agreements to acquire or modify space and use rights for infrastructure installation and operation. Obtain property owner approval on engineering drawings and zoning/permit applications.
Wireless carriers, site developers, and facility investor clients use standard forms for space rights agreements. These forms have been drafted by legal counsel to match the client’s criteria. Some property owners or their representatives may comment that a wireless facility developer’s agreement is one-sided; others will say it is fair. In either case, wireless facility developers require quality space rights and the property owner has ample opportunity to influence the language of the final agreement through good-faith negotiations.
As discussed in Module 12 Property Owner Communications, the selected candidate was one of those proposed in the SAR. The property owner accepted the nature of the proposal, including a rental amount, the size of the space requirement, and a long-term context for the relationship. Other standard terms of the agreement may have been left for owner review, evaluation, and negotiation after site selection when a complete space proposal is tendered. As site drawings are generated by the A&E firm, they are subject to property owner review and acceptance.
Site space rights agreements convey property entitlements and are legally enforceable for the life of the agreement. Attorneys draft the language and review any requested changes. Site acquisition consultants participate in the negotiation through accurate, efficient, and effective communication between the property owner—which may include the owner’s legal counsel—the client’s point of contact, and the project attorney.
As a functional matter, this often entails revising communications directly received from any of the parties, since our role is that of an intermediary. Effective communications with the client about the property owner’s interests and with the property owner about the client’s interests need to be assimilated and posed as the draft language for decision-making. The bottom line is that being the intermediary is not about simply forwarding comments between the client and property owner; it is about analyzing those comments and suggesting solutions. The client’s comments often include negotiation strategies not intended for a property owner to see.
The property owner may suggest that upon termination, the client must remove concrete foundations below the surface of the ground to avoid the possibility that farm tractors could be damaged. The site acquisition consultant proposes language to the effect that the foundations will be removed three feet below the surface (a standard for farm equipment). Determining the proper language may require research. Negotiating space agreements is partially an art in understanding why a property owner makes the comment they do about the agreement terms. Knowing the why helps formulate how to resolve the issue.
I discuss the structure of agreements with respect to this essential function. It’s up to the site acquisition consultant to structure agreements to match his or her knowledge of the specific location, property, and property owner with respect to the wireless developer’s criteria. The process of completing space rights agreements with property owners can be very rewarding work.
Upon the completion of the Course Topics in Module 21- Initial Space Rights,
please progress in the Roadmap to the next Module 22 – Leasing Concepts.
Upon the completion of the Course Topics in Module 22- Leasing Concepts,
please proceed in the Roadmap to Module 23- Collocation Agreements.
Upon the completion of the Course Topics in Module 23- Collocation Agreements,
please progress in the Roadmap to Module 24- Lease Provisions.
Upon the completion of Course Topics in Module 24- Lease Provisions,
please progress in the Roadmap to Module 25- Purchase Contracts.
Upon the completion of the Course Topics in Module 25- Purchase Contracts,
please proceed in the Roadmap to Module 26- Miscellaneous Agreements.
Upon the completion of the Course Topics in Module 26- Miscellaneous Agreements,
please proceed in the Roadmap to Process #10- Space Rights Documentation.