Case Study: Helping a Developer Exit a Cell Tower Lease Without Burdening the Future HOA

Client Profile:
A prominent real estate housing developer in the Southeastern U.S. is master planning a residential community. The master planned community included a cell tower lease generating passive income—but also long-term management obligations.

Challenge:
The developer wanted to sell the cell tower lease prior to finalizing the master plan and establishing the homeowners’ association (HOA). Their goal was to simplify the transition and avoid burdening the future HOA with the complexity of managing telecom leases. Our team was brought in to maximize the value of the lease while ensuring a clean and timely exit.

Approach:
Rather than negotiating directly with one tower company, we took the lease to market, leveraging our national network of institutional buyers and tower operators. The site was particularly attractive due to the tenant—one of the three national wireless carriers—driving a highly competitive bidding process.

Results:
• Above-Market Valuation: Due to tenant quality and favorable lease terms, we secured multiple offers, ultimately negotiating a final price well above standard market value.
• Strategic Buyer Selection: We identified a buyer who could meet the developer’s timeline and understood the long-term value of the asset.

Unexpected Roadblock:
The lease agreement contained a Right of First Refusal (ROFR) —but only on the land itself, not burdening the lease or an easement sale. This created legal complexity and a potential delay in closing, as the cell lease tenant would need to be notified and given time to respond. There was also the possibility they would challenge the ROFR’s definition in a much broader way.

Our Creative Solution:

Our team quickly adapted. We worked closely with counsel, the buyer, and the developer to structure the transaction in a way that preserved value while complying with the ROFR. We navigated the legal language carefully, structured the easement transaction to avoid triggering the ROFR, and communicated transparently with all parties.

Outcome:
The deal closed on time, with zero HOA involvement, and the developer exited with maximum value.

Takeaway:
Selling a cell tower lease before transitioning to an HOA is a smart move—but the details matter. With the right strategy, market access, and a creative team, even complex deals can close smoothly and profitably.

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