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Farmers warned as telecom firms seek to slash rental payments

Mobile operators are trying to take advantage of new rules on the siting of phone masts to offer landowners far less for radio mast sites than they were previously leased for.


Alex   Black

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Alex   Black
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Farmers warned as telecom firms seek to slash rental payments

Derisory offers are being made by telecom firms looking to take advantage of new rules on the siting of phone masts, it has emerged.

 

Farmers who had previously been offered thousands of pounds per year were now being offered as little as £32 for a 10-year agreement.

 

The new Electronic Communications Code came into force on December 28 with wide-ranging reforms in favour of operators intended to speed nationwide access to the digital economy.

 

But property firms have said ‘derisory’ offers from telecoms companies could have the opposite effect.

 

According to property consultancy Galbraith, a Government impact assessment before the law came in envisaged rent would fall by about 40 per cent.


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However, operators were offering payments from £3/year on greenfield sites which previously attracted rents in excess of £5,000/year and £50/year for rooftop sites which commanded rents of £12,000/year.

 

In addition to bringing vastly reduced rents, some terms being proposed by operators gave them more rights than they had been granted under the code and limited the liabilities imposed on them.

 

Mike Reid, head of energy and utilities at Galbraith, said landowners were generally supportive of efforts to achieve better connectivity but he doubted they would be prepared to agree to these proposals.

 

“We understood the operators wanted a fair and balanced way to serve the need for masts. This is not the solution property owners had in mind,” he said.

Land agent Eifion Bibby, of Davis Meade Property Consultants, said payments for the land hosting the mast was now assessed on the value to the landowner, not the operator, and operators were now seeking to drive down previous rentals.

 

“For example, one client of mine who previously had been offered £4,650 per annum to host a telecom mast is now being offered a one-off payment of £32 for 10 years.

 

“In another example an operator has offered £89.34 to set up a 15-year agreement for a site which previously had an agreement of £6,800 a year.

 

“When I challenged the operator on the offer of £32 they said it was a consideration based on the fact the landowner would not incur any costs which needed compensation.”

 

She added it was important for landowners to fully understand the terms and implications and to seek advice before signing any new agreements.

Mike Reid’s top tips for businesses

 

1. Do not rush to respond and consider the full approach carefully before you do

 

2. If you have an existing site where you receive an approach check the current status of that agreement

 

3. The telecom companies will propose terms based on their reading of the code, but do not take their terms as all which can be agreed.

 

4. The rent under the code should be agreed between the parties and not imposed so there is scope to negotiate any offer

 

5. Compensation is due in addition and the farmer/landowner will usually have a better idea of the potential impact than the telecom operator

 

6. Take professional advice as the code makes provision for compensation to be awarded to cover reasonable fees

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