Making the message clear – weighing up the pros and cons of having a phone mast on your land, as a £5 billion Government deal to improve phone signal in the countryside is announced.
If you have land to spare, and you’re looking for farm finance, you might be considering renting your land for phone masts. The Government has recently pledged to improve mobile phone signal to achieve 85% coverage in rural areas by 2017, after striking a £5 billion pound deal with the four main network operators. This in itself, is good news for farmers, as a lack of phone reception can be a major hindrance, particularly in an industry where workers are often alone and carrying out high risk tasks. Crucially though, it also means that phone operators are desperately seeking locations for new masts , and a call has been put out to the farming industry, in a bid to find suitable land.
But, before you rush to sign a deal, what are the things that you need to consider? It’s true that it can be a good source of farm finance for little effort – each mast currently yields at least £5000 per annum – but it’s important to thoroughly check the terms and conditions of any contract in the same way you would for any commercial lease.
A phone mast is classed as a commercial tenant, like any other, and therefore it will have security of tenure under the 1954 Landlord and Tenant Act. Unless agreed otherwise at the start of the original contract, this may mean that the network operator has the automatic right to renew, even if you need your land back to develop. In addition, mobile operators have further protection through the Telecoms code, and although this is being discussed at the moment, it currently means it can be very difficult to remove a phone mast from your land.
Another common issue is an operator requesting early access to a site, for inspection or surveying, before a lease has completed. There have been instances where landowners have agreed to this and then the network operators have employed delaying tactics and completion of the lease drags on and on. In this scenario the network operator may have been granted a short-term license, in exchange for a small fee, but once on site they have the protection of the Telecoms Code and getting them to complete or vacate in a timely manner can be tricky.
Other pitfalls that you should be aware of are operators attempting to move more equipment onto the site than originally agreed, thereby taking up more space, and network sharing with other operators, without prior consent. Of course these issues are hard to police, which is why you need to call in the professionals before you sign your land away.
A lawyer or adviser with the relevant niche experience, working in your interests will be invaluable, although invariably costly. Professional fees to draw up a lease, and negotiate terms and conditions can run into thousands, even when the lease doesn’t complete, so ideally you should get the operator to agree to cover your costs before discussions begin.
It’s not all bad news though, network operators will often sign long-term leases and if you have large swathes of unused land, it can be a relatively simple money-spinner. The Telecoms Code could still be coming under review –changing the rules for operators and landowners, as some changes that were proposed in January have been withdrawn by the Government to give more time for consultation.
The most important point, whether you are contemplating a new phone mast on your land or whether you are renegotiating terms on an existing lease, is to seek professional advice, preferably at the network operators’ expense. Don’t be intimidated by the operators or their agents, know your rights and stand firm about your terms.
There have been fears that aside from the Government pledge to improve rural reception, mergers between operators might lead to many mast sites been decommissioned. Consequently lots of farmers and landowners have received letters from operators encouraging them to accept less favourable terms on existing contracts. If this has happened to you, it’s best to take advice and not be bullied into hasty action because although some sites may be decommissioned, the new legislation means lots of new sites will be required, especially in rural reception ‘not spots’, as the areas without signal have been dubbed.
If you do have an existing phone mast on your land, and you’re concerned it could be decommissioned or if you have decided a mast is not the right choice for you but you still need alternative finance, Access Commercial Finance can help. We are a well-funded commercial lender, and broker, that excels in finding funding or cash-flow solutions for unusual circumstances. If your business proposition has potential, we will spot it, so if you need a financial boost give us a call today on 03330 069 141.