March 21, 2017
Built by companies ranging in size from single-site owners to publicly traded companies owning tens of thousands of structures, roughly 200,000 towers deliver wireless communications in the United States.
To compete and survive, small companies that build new towers must work smarter, be strategic, and approach clients and suppliers differently. Many underestimate the time and resources necessary to build a tower. Meeting rigorous engineering requirements, securing permits and navigating zoning ordinances consume time. So do site selection, obtaining local and state approvals, and achieving customer satisfaction.
All tower developers want to build towers for the major wireless carriers to use, but small tower companies find advantages in having a diverse portfolio of tower users. It protects your business from consolidations, mergers and new technology. Having diverse tenants, such as cellular companies, government agencies, internet service providers, private networks and public safety agencies, gives tower companies multiple sources of income that help them weather ongoing market changes.
Small tower operators may find it difficult, but not impossible, to obtain master lease agreements and build-to-suit projects. To manage this difficulty, they should pursue new and unique opportunities using a smart, experienced team. They should have contingency plans to implement when projects don’t go as intended or when problems arise with tenants. Avoid shortcuts, and expect to spend additional capital to meet deadlines. The added effort and additional resources used to complete a project on time generates goodwill between the client and the customer, and serves to build long-lasting relationships.
Occasionally, a tower company fills roles as both the builder and owner of wireless telecommunications sites. With the dual roles come improved communication and better knowledge of the project that may lead to faster construction. With the 12 towers my company TowerKing built in 2016, no detail on any project was overlooked or was unknown to our crew.
Completing environmental assessments, architectural and engineering work (commonly called A&E), site acquisition, Federal Aviation Administration regulatory compliance and tower fabrication often become more efficient when smaller companies perform the work. Tower companies can benefit from working with groups that specialize in certain aspects of the project, rather than with a one-stop shop. It allows several professionals to oversee projects to ensure participants complete all steps correctly. Working with more than one professional on a project introduces additional creativity and brings more experience to the table. It shortens turnaround time and improves communication. These relationships allow tower companies to provide more frequent, real-time site updates to their customers.
Building New Towers
A small company building a new tower reaps dividends from being involved in every aspect of the project, although new construction may seem overwhelming at times. If you could focus on only one aspect, choose site acquisition. Not only does conducting your own site acquisition save time and money, it also develops relationships with landowners during the earliest stages of tower building. At my company, we start by knocking on doors and meeting with landowners face to face, rather than sending letters or making phone calls. The personal interaction allows us to learn about the local area, gather opinions about the proposed tower, and hear stories about other towers, including what nearby residents say about them. Firsthand accounts will help you decide what to do and what to avoid when preparing for zoning. If you don’t get out there, you miss out on all of this great information.
Find landowners as excited as you are to have a tower on their properties, and you will create a partnership capable of enduring unexpected hurdles. Working with cooperative landowners makes it easier to move the tower or modify design elements. One landowner was so cooperative, he told me that I could put the tower anywhere on the property, even on his porch.
When you see the property in person, you gain a better understanding of its unique characteristics, including drainage, site access, utilities, fiber access and environmental concerns. I visit sites during every survey. It helps to be available to direct the survey team regarding tower placement, site access, utility access and other matters. You can help place the tower where it may be less visible, which shows concern for the neighbors.
Attend all of the zoning and planning meetings. Nothing makes a better impression on a zoning board than having you there to answer questions. Bring an experienced site acquisition and zoning expert, along with local legal counsel. It’s expensive, but having local legal counsel helps to expedite the zoning process. A local attorney can visit the courthouse and recorder’s office, delivering documents in person.
At zoning and planning meetings, much can change, and quickly. When you attend as the tower owner, you can work with the board and make changes on the fly — no need to table motion. If possible, have a meeting with the board or planning director prior to the public meeting. Let them know you are a small business owner and that towers pay your bills. State your intention to build a tower that can accommodate many carriers and that you are happy to provide antenna space for municipalities, water departments, the sheriff, emergency medical service providers and hospitals. Tell them you plan to remain the tower owner for many years to come. These gestures speak volumes about your willingness and eagerness to work with them, giving you a tremendous edge when applying for zoning for a site.
Working with local electricians, fence contractors and stone and excavating services ensures that all of your equipment is obtained locally, so you don’t have to wait for it to be shipped. Working with local companies familiar with the power and utility companies makes pulling permits quick and easy. Zoning boards will be pleased to know that you are going to be employing local businesses for your project.
For tower design and fabrication, I like to buy from small companies that provide turnkey tower construction. Using a company that fabricates and erects your tower eliminates headaches and streamlines construction. Using small, nearby shops makes it possible to stop in and see your tower being fabricated.
Fabricate the tallest and strongest tower you can. It costs more up front, but it is easier and less expensive than modifying the tower later. A greater height increases the likelihood of obtaining more customers. It also may protect your tower from invading competition. Sell local zoning boards on the notion that approving a taller tower will help to eliminate the need for a community to approve additional towers.
Although many cellular towers stand 180-feet to 250-feet tall, remember that internet service providers, government entities, public safety agencies, private networks and two-way radio users need antennas that many times require taller towers.
I like to build 340-foot, solid-leg towers that accommodate six 10-foot HP dishes, four carriers at 12 panels along with associated radios and two 8-foot HP dishes. Generally, these taller towers are guyed, but the same design should be considered for self-support towers. I like to buy towers in bulk and store them in warehouses, a step that can greatly reduce construction time. If you build towers in several states, choose the state with the most stringent TIA-222-G standards and design your tower to those standards. Then, when you build in a state with more lenient design standards, your tower receives a rating of even greater strength. With towers available from storage, all you have to do is design the foundation; the tower is ready to stack.
A heavy-duty design will help protect your tower from changing standards. Sometimes adding ⅛-inch of steel to the tower diagonals can increase the tower’s capacity by 10 percent. You can make this rather inexpensive improvement to your tower design. A stronger tower creates flexibility for your tenants. They won’t have to worry about modifying your tower if they need to upgrade equipment they installed on it.
Technology is changing the world we live in, and the telecommunications industry has seen as much change as any other. The internet provides tools to watch progress with supply orders in real time, manage construction delays and obtain weather updates. It helps to have someone on your team who understands the latest technologies and industry jargon. It’s important to understand RF fundamentals, electrical requirements and propagation studies, in addition to the technical aspects of tower construction. Such knowledge can help you determine the type of tower to build and what customers you may expect to collocate on your tower.
Success depends on having your finances in order, and cash is king. Whenever possible, avoid using venture capital. Venture capital can become costly and can cut into your bottom line. Instead, as much as possible, use money from local banks. Today’s low interest rates make business loans affordable. With low interest rates, it can make more sense to obtain a bank loan rather than using your own cash. Although most bankers are familiar with home, auto and farm loans, they may be nervous about lending cash to build a tower. You may have to educate them about how towers operate financially and how the wireless industry is explosively growing.
Build a tower like it is yours, because it really is. Use your small tower company’s competitive edge over larger tower companies. Without boards or stockholders to please, you can do things differently. Make every project special. With every project, create great relationships with landowners, local leaders and new vendors. Your team builds a good tower — you can’t do it by yourself.
Whether you’re a veteran of the business or are new to the business and interested in starting your own tower company, one thing is clear: Building a tower poses challenges. I hope that in sharing several of our company’s strategies, I’ve provided helpful tips for navigating this complex business. Good luck, and get vertical!