Landowners urged to push back against Cornerstone’s reduced rental demands

We often hear about how hard site acquisitions are for operators. Here's a view from the other side of the fence.

A Scottish property services company has urged landowners not to concede too much ground in negotiations with Cornerstone, the infrastructure partnership set up by O2 and Vodafone in the UK.

CKD Galbraith claimed that Vodafone and O2 “have been writing to individual landowners requesting their agreements are assigned to Cornerstone Telecommunications Infrastructure Ltd (CTIL) and proposing changes in their favour.”

CTIL is the venture tasked with building out a network on a merged grid that Vodafone and O2 are building in the UK. As such, some sites are being targeted for decommissioning. CKD Galbraith claimed that CTIL has been intimating that landowners who don’t agree to reduced rents risk losing the site altogether.

The property company said: “Requests for significant rent reductions, frequent tenant’s break clauses and more relaxed agreement terms are commonplace, sometimes giving the impression the site will be decommissioned if suitable terms can’t be agreed.”

It added that landowners could call Cornerstone’s bluff on this last point – in its opinion reduced rent terms will make “little difference” to whether Cornerstone decides to decommission a site or not.

“While some sites will be decommissioned as part of the network consolidation plans, agreeing to the operators demands could make little difference as to whether a site is retained as part of the wider network,” a press release from CKD Galbraith claimed.

According to Mike Reid, Head of CKD Galbraith’s Utilities Department, property owners should not necessarily concede to the operators’ demands and bear the brunt of cost savings.

“Some landlords will actually be in a very good position to renegotiate to their own advantage,” said Reid. “Often the situation is presented as a problem that only the mobile operators can solve but even when owners feel they have little bargaining power, there is usually more than one course available.

“Reviewing the existing agreement terms often shows the operator cannot implement their proposals without the owner’s consent. We have helped many property owners in such circumstances reach an amicable settlement with their much larger tenants where, in some cases, rents have been increased and other terms improved in the owner’s favour.”

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