Fully Loaded Monopole

DISH Lease Valuations: From Discount to Zero

The DISH situation has moved well beyond a valuation discount — buyers now attribute no value to DISH tenant revenue. Most tower owners are no longer being paid on their DISH leases, and few expect to collect anything meaningful going forward. As a result, tower cash flow (TCF) on DISH-tenanted towers has already declined for many owners, and that reduced cash flow is what buyers are underwriting.

There are two additional headwinds. First, buyers are now factoring in future equipment removal costs, since DISH equipment is widely expected to be abandoned in place. That’s a cost, not revenue. Second, DISH accounted for an estimated 30–50% of new colocation lease activity between 2021 and 2024, and with DISH effectively out of the market (along with US Cellular), the pipeline of new leases and amendments will be meaningfully slower going forward. The AT&T acquisition of DISH spectrum may generate some incremental amendment activity, but we are skeptical it will significantly offset the lost lease-up volume.

The silver lining: when DISH equipment does come down, it frees up a RAD center — and for a well-located tower, that’s a real opportunity.

There Are More Buyers Than Ever — But They Are Getting Smarter

Whether it’s lease buyout firms expanding into tower ownership, lease optimization companies making portfolio offers, new tower companies, or infrastructure funds, there remains strong demand for tower assets. Market valuations are still attractive despite the industry slowdown of 2024. That said, the buyer pool is more sophisticated than ever. Buyers are paying close attention to which carriers anchor a tower, the pace of historical lease-up, and the exposure to carriers like DISH and US Cellular. More buyers does not mean less scrutiny — it means more competition for the right assets, and more discipline around the wrong ones.

Zoning Protection and No Competing Structures Are Still Essential

The lesson from 2024 remains true heading into 2026: tower buyers discount or pass on assets they consider distressed, particularly those with limited lease-up potential. Well-located towers with strong anchor tenants and zoning protection continue to command premium prices. However, towers anchored by second-tier carriers, or located in areas without zoning barriers to entry, are facing harder questions from buyers — especially given that the Big Three (AT&T, T-Mobile, and Verizon) are increasingly willing to build near an existing tower rather than collocate on it if zoning permits. In a three-carrier world, every location decision matters more than it did when DISH and US Cellular were active deployers.

Questions Buyers Ask- and other Concerns in 2026.

Below is a list of questions you should be asking yourself about your towers- because buyers will be. Curious about the other issues that tower owners are facing in 2026?  See our separate post on Top 8 Concerns for Tower Owners in 2026.

Tower Location

• Do any local zoning regulations (or other barriers to entry) prevent new towers from being built near the subject towers?
  • More than at any other time, buyers focus on whether the local zoning regulations would prohibit the placement of another tower near the subject towers.
• Do the subject towers have significant competition from other existing towers?
  • Due to the increasing willingness of large wireless service providers like AT&T and Verizon to consider relocation to other existing towers, buyers like to know that there are no existing towers near the subject towers that will serve a similar purpose. Lack of competing structures combined with difficult zoning regulations improves the odds for future colocation without undue interference from relocation tower providers. One large tower company tends to avoid purchasing towers in areas without zoning that has AT&T as a tenant. Will others follow?
• Why did the developer build the individual towers or the portfolio?
  • Because some developers are intentionally building towers near other existing towers, buyers try to determine why the towers were built. Were the towers built for coverage or capacity purposes (or both)?
• Is the portfolio regionalized?
  • Buyers like to see purpose-built concentrations of towers due to more efficient maintenance, marketing, and operation.

Tower Tenants

• Who is the anchor tenant?
  • Especially for more rural locations, buyers are looking closely at who the anchor (first) tenant is on the tower. The buyers have found that some 2nd tier wireless carriers have towers that aren’t leasing up at the same rate as those anchored by AT&T, T-Mobile, or Verizon. These 2nd tier carriers are building in rural areas without zoning and as a result, the Big Three carriers may be willing to simply build near existing towers rather than collocate on them.
• What is the ratio of broadband to narrowband tenants?
  • Buyers prefer broadband equivalent tenants, i.e., cellular, government, utilities, and FM and TV broadcasters. Narrowband tenants, such as paging, mobile radio, and WISPs are not valued as highly, primarily because of lower expectations of longevity related to those leases.
• How creditworthy are the tenants on the tower?
  • Buyers also assess the creditworthiness of the tenant roster to determine the longevity and churn risk.
• What is the exposure to possible terminations from Sprint?
  • With the Sprint/T-Mobile merger, buyers will examine the exposure to possible terminations due to the merger. Buyers will also look closely at MetroPCS, Cricket, and Clearwire leases for possible termination.

Tower Tenant Lease Terms

• What are the rent and escalations?
  • Older leases tend to have higher escalations. Presently, some developers are accepting lower-than-normal escalation rates in their leases, which can damage the value of a portfolio.
• Is there a claw back to the anchor tenant if additional tenants colocate on the tower?
  • Many newer built-to-suit leases include reductions in rent to the anchor tenant when subsequent colocators come on the tower. Buyers prefer that there is no claw back clause in the tenant lease.
• Do the tenant leases allow for additional revenue when modifications by the tenant are requested?
  • Buyers scrutinize the tenant agreements (especially newer leases) with the major carriers and look to avoid the nearly unlimited “buckets of equipment” some developers are conceding to these days. Tower valuations are higher for those with tenant leases which provide that a cellular tenant must pay additional rent to add or modify equipment on the tower. 
• What are the general termination rights?
  • Buyers like to see leases without termination rights vested in the tenant during each term. They do not like to see liberal termination rights. This is especially true if there is no zoning in the area or there are competing structures.
• Are there sublease rights or sharing rights granted to the tenant?
  • If so, buyers may be concerned with the loss of future upside.
• Are any expenses passed through to the tenant?
  • While it isn’t that common, buyers prefer that the tenants be held responsible for reimbursing the tower owner for some expenses, such as insurance, compound or road maintenance, and taxes.
• What is the historical lease-up? 
  • Towers with less lease-up over time are more likely to continue to suffer from below-average lease-up in the future. Since the purchase price is based upon current revenue and future revenue upside, buyers prefer towers with demonstrated lease-up.

Ground Lease Terms

• • Who pays real property taxes on the property?
    • Some leases require the landowner to pay all taxes, while others do not. Tower buyers prefer that the landowner pay all taxes.
  • Is there a revenue share clause within the ground lease agreement?
    • For obvious reasons, buyers prefer not to share revenue with the landowner. A revenue share provision will devalue the tower.
  • Are there prohibitions/restrictions on the sale of the lease to third parties?
    • This may include a right of first refusal or an outright prohibition on the sale of the lease to third parties. Buyers prefer that the lease contains right of first refusal language.
  • Does the landowner need to consent to an assignment or sublease?
    • Tower companies prefer not to have to go to the landowner for consent to assignment or subleases because landowners generally take time to review requests.
  • How much time remains on the lease until final term expiration?
    • The shorter the remaining term, the more likely the tower owner will incur an increased lease rate at expiration and resultant higher expenses for operating the tower.

• Has the tower seller been successful at buying out their ground leases and converting them to long term easements or purchasing the ground entirely under the towers?

• • Buyers prefer easements as opposed to leases because easements generally construe better rights to the buyer than a ground lease and the buyer doesn’t have to worry about extending the lease in the future.  There is an added benefit to tower sellers in that the sale price is commensurately higher without a ground lease expense.  

Tower Specifications

• Do the assets have additional structural capacity?
  • If the assets do not have sufficient structural capacity for additional colocation or modifications, the buyers will reduce their offers. Buyers like to see recent structural analyses and manufacturer drawings to confirm structural capacity and determine what is needed structurally if further modification work on the tower is required.
• Have the towers been well-maintained?  
  • Buyers prefer to purchase tower portfolios that have a clear record of maintenance over time.  
• How old are the towers?
  • Buyers prefer to purchase newer towers because they tend to have lower maintenance costs and higher structural capacity than older towers, especially on guyed towers.
• How many towers have FAA required lighting?
  • This isn’t a material issue for buyers, but it does result in slightly lower offers for towers due to the additional expense from monitoring and powering FAA notification lights.

Intangibles

• Who is the developer or operator?
  • Buyers like to work with established developers who have refined their business processes. They also like to work with developers with a known track record for developing good towers. 
• How does this portfolio fit into the tower buyer’s general or specific acquisition strategy?
  • Some buyers look to buy assets that mirror their existing portfolio’s location or growth profile. Others who have built several towers in the last few years may look to fill in their portfolio with mature towers so they have a more rounded portfolio.

Collectively, these factors account for most of what tower buyers are looking for in today’s market. Make no mistake, it is a seller’s market and buyers are paying high premiums for good towers. 

Curious How Your Tower Portfolio Is Valued In Today’s Market?

Are you curious about how your tower assets would be valued in 2025? Please reach out to us here to request a confidential analysis of the value of your tower assets. 

As a broker for cell towers and cell tower leases, my first question tends to be “what multiple of rent will someone pay for these assets?” 

The answer to that question over the last few years has been an easy one: “more than last year.” Between low interest rates, a lack of inventory for sale, and the amount of stimulus introduced to the US economy over the last three years, the valuation of towers and leases has continued to climb during that time. Despite inflation, we haven’t seen a material impact to asset valuation. But there is a question stuck in the back of my head: “how long can this last?” 

With inflation at 8.5% over the last 12 months and 4.7% in 2021, it seems like there should be some type of rationalization of tower and lease valuations. Furthermore, while the sale prices for most tower types are very attractive, the actual business of building and operating towers is becoming more difficult and expensive. As a result, I thought I would conduct a deep dive into what it is like to be a tower developer these days. To do so, I contacted the CEOs of four tower developers with portfolios of anywhere from 100 to 1,000 towers. Here are their thoughts (and mine) about the state of the tower industry. 

Increased Costs for Tower Developers

• Increased Capital Expenditures for Tower Development

First and foremost, the cost to build towers has increased at a rate that has outpaced inflation over the last 20+ years. The tower developers we spoke with indicated that the average cost of construction of cell towers has nearly doubled over that time. This translates to inflation of approximately 4.5% per year. 

There are a few reasons for this. First, carrier loading has more than doubled over that time. Long gone are the days where a carrier would install 6,000 to 7,000 square inches of equipment on a tower. Today’s installations commonly exceed 20,000 square inches and some newer master lease agreements entitle the carrier to install upwards of 40,000 square inches of equipment. 

Secondly, the rising cost of materials – especially steel – has had an outsized impact on development cost. One developer indicated that the cost of steel has increased by 50% in the last 5 years. Increased fuel costs impact both tower crews building the tower and the cost of transporting the tower and other supplies to the tower site. Further, tower construction contractors are able to charge more for jobs because there is so much modification and constriction activity related to 5G.

• Increased Operating Expenditures for Tower Developers

On the operating expense side, there are also increased costs. The cost to perform regular maintenance at sites has increased by 10-25% over the last 10 years. Insurance and real property tax expenses have also increased. Furthermore, as towers become older, they require slightly more maintenance and repair. For one developer, maintenance costs have risen by 40% over the last 10 years. Two of the tower developers we spoke with mentioned that land leases have also increased as the typical landowner has better information available to them. Fortunately for tower developers, total operating expenditures for tower operation typically equates to 20% or less of the revenue generated by the tower (except for single tenant towers). So even a moderate increase in operational cost typically doesn’t have an outsized impact on profitability. 

• Increased Debt Costs for Tower Developers

As recently as 4 months ago, large tower developers could obtain debt (via a loan) at 3.5% per year. Today, that’s closer to 5-6%. As inflation continues to climb, so will costs – especially for borrowers with variable rates. One tower developer indicated that they are using more equity than debt because the cost of equity is approaching the cost of debt. While the increase in borrowing costs has not impacted tower multiples (yet), it does increase the cost of holding onto towers. For developers that tend to build and flip (sell towers within a few years of building them), the increased cost of borrowing doesn’t have much of an impact. But for developers who plan on holding onto the towers, it’s just one more lever that decreases the profitability of owning and operating towers. 

Flat or Lower Revenue for Tower Developers

It is important to distinguish between existing towers and newly built towers for the following discussion. For existing tower portfolios, especially those in areas with even moderate zoning, the tower owner maintains the ability to negotiate fair market value leases. For “built-to-suit” (BTS) towers where the developer builds a tower for a wireless carrier who leases space back from the developer, there tends to be greater competition between tower developers for those opportunities. As a result, the lease rates for anchor tenant collocation leases for a BTS tower have not even remotely kept pace with inflation. 

• Lower Rents

By way of example, I looked back at the collocation lease rates that we were charging back in 1997 when I started in the tower business. At that point, our collocation rate for BTS leases and for collocation leases was between $1,650/mo. to $1,750/mo. Today, some tower companies are entering into BTS leases with the Big Three wireless carriers for rates that are lower than $1,650/mo. At the low point in the market a few years ago, one company was agreeing to $800/mo. for an anchor tenant collocation lease. In other words, not only has the market for BTS leases not kept pace with inflation – it has receded.

Even non-anchor collocation leases (2nd sublease tenant on the tower) have failed to keep pace with inflation. Lease rates today for collocations on existing towers are typically in the range of $2,000/mo. with more expensive construction sites commanding slightly higher rents of $2,500/mo. The difference in today’s rates compared with what we were getting in 1997 suggests that collocation lease rates have increased by less than 1% per year over the last 25 years. 

• Lower Escalation

To the further detriment of tower developers, wireless carriers have been aggressively negotiating down the escalators in leases. Long gone are the days of a Consumer Price Index-based escalation. Most collocation leases today have flat escalation of 2% per year while DISH has been pushing 1% per year escalation in its collocation leases (and getting it). 

While escalation may not seem like it has a significant impact, consider what happens over time. Take for example the following two scenarios.

1. Standard collocation lease at $2,000/mo. with 2% per year escalation 
2. Standard collocation lease at $2,000/mo. with 2% per year except for the last two years 

Any idea how much of a delta there is in overall income over 25 years for these two scenarios? Scenario two will net the tower developer an additional $68,000 over the course of the lease – all because of the significant inflation we are facing in only the last two years.

• High Rent Relocation

If flattening lease rates and lower escalation weren’t enough for tower developers to contend with, they also must address possible relocation of higher rent leases on their towers. One need only look at Tillman Infrastructure and its rise to the top of tower developers in the country by number of towers (1700) in just 6 years to understand the impact. Tillman is one of a number of tower companies who are willing to build new towers near existing towers in order to relocate AT&T or another wireless carrier. The net result is a few thousand existing collocations that have moved to nearby towers. We believe that the threat of relocation has negatively impacted some tower companies in that they have either had to agree to lower rents on individual leases or had to negotiate more favorable master leases with the carriers to prevent relocation.

Tower Development Is Still a Great Business

To be fair, the tower development business is still a great business to be part of. Despite the increased costs and lower revenue per lease, it’s hard to be jaded about being a tower developer. Due to increased competition for assets, limited availability of quality portfolios, previous very low borrowing costs, and the impact of new entrants into the market chasing lower yields, values for towers have never been higher. Every developer I spoke with confirmed my suspicion that the increased costs/lower or flat lease rates hadn’t reduced their desire to develop towers. Some were pickier in choosing which BTS opportunities they pursued, but they were all still actively looking for more opportunities. 

If interest rates stay elevated, perhaps we see some belt-tightening or some rationalization in terms of lease rates and escalation, but under the current market it is difficult to see that there will be much change to the current equilibrium. Wireless carriers are getting more for their leases while tower companies still generate outsized returns when selling their portfolios.   

The business of tower development may be harder than it has been historically, and developers may need to be pickier on the opportunities they choose. (If you want to know more about the criteria that tower buyers evaluate when pricing a portfolio- please see this article on what tower buyers want in 2022.)  Absent a significant downturn in the economy, there are (and will be) no shortage of companies interested in developing and owning towers.  Nor will it be difficult to find buyers for those towers once they are developed.   

It just won’t be as easy as it used to be.