If you live in an urban or suburban location, look around the next time you take a drive. There are commercial properties everywhere. Shopping centers. Office buildings. Stand-alone pharmacies. Warehouses. Malls. Banquet halls. Commercial properties come in all shapes and sizes. Despite the uptick in e-commerce, and despite the ongoing revolution in the commercial marketplace caused by companies like Amazon, there always will be commercial buildings scattered throughout peoples' communities. Moreover, the owners of those buildings will always be looking to maximize the returns from their assets.

At the most fundamental level, building owners lease “space” to tenants in exchange for rent payments. When people think about rentable space in a commercial property, they immediately tend to think of an indoor unit of some kind. In addition to renting these traditional spaces, many building owners have become more creative in order to maximize the returns from their assets. When appropriate, some building owners charge rent for tenants to place additional signage at a building. Other building owners charge additional rent for prime parking spaces.

For various reasons, building owners have underutilized their rooftops as a rent-producing spaces. Whether for a lack of demand, or a fear of violating their rooftop warranties, rooftops often are used only for the placement of HVAC equipment. However, within the last decade or so, and in conjunction with the boom in wireless communications, data usage and telecom providers' need to add capacity to meet their customers' demand, some building owners have begun offering portions of their rooftops to telecom providers as rentable space.

Depending upon how many antennas are placed on a rooftop, how much space is utilized, and a host of other variables, some building owners may generate as much as $2,500 per month from the use of these, more often than not, underutilized assets. Some owners earn more, others earn less. Regardless, and especially during times when traditional brick-and-mortar tenants are going out of business and vacating their leased premises, a building owner would be foolish not to consider using alternative space, like his rooftop, to boost the returns on their assets.

Unfortunately, not all building owners are able to attract telecom providers to their properties. Telecom providers generally look for the taller buildings in a location. They also look for properties which fall within the telecom carriers' “search rings.” Sometimes buildings are not considered if there already is a nearby telecommunications site.

One way to determine if a building is suitable is to ask one of the tower companies. Because tower companies provide infrastructure on which telecom providers place their antennas, they generally know which buildings are suitable, and which buildings may become suitable as a result of technology changes. If a tower company believes a building is, or may become, suitable, it may ask that owner to enter into a “marketing and right to lease agreement” by which the tower company would market the building to telecom providers and, once antennas are installed, manage the site in exchange for a portion of the rent collected. Building owners should incur no charge in order to enter such an agreement.

In conjunction with the marketing agreement, tower companies usually ask building owners to agree upon the form of lease agreement to be used in the event a telecom carrier expresses interest in a site. Mechanically, the building owner leases rooftop space to the tower company, which subleases that space to the telecom provider. It behooves the building owner to carefully review the terms of those agreements to make sure his or her interests are adequately covered. For example, it often is a good idea to require the tower companies to include certain provisions in their subleases with the telecom providers. These kinds of provisions may be negotiated into the form lease.

Although building owners and tower companies generally agree upon terms that benefit both parties, if during the negotiation process, a tower company insists upon including concepts which exceed the building owner's risk tolerance, the owner should attempt to balance the benefits of entering the agreement against its effect on the property. Just as tower companies engage counsel to work through decisions and issues that arise during contract negotiations, it often helps for building owners to engage counsel to guide them through the negotiation and risk mitigation process.

Matthew Kwasman is an attorney at Nason, Yeager, Gerson, Harris & Fumero, which has offices in Palm Beach Gardens and Boca Raton. In addition to his general commercial and residential real estate practice, he represents both tower companies and property owners in transactions involving the purchase, sale and lease of real property focused on the placement of telecom equipment and infrastructure.