Lucky landowners with properties in the right spot have been able in the mobile phone revolution of the past 20 years, to rent out land for phone masts, over 40,000 now in the UK. With the telecom provider obtaining planning in place, surplus land has been able to help the owner from helping these big corporations and putting in place a phone mast. Historically, these values have been between £4.5k to £9k annually under 15-year leases, depending on location.
With the coming of 5G and the need for another 40,000 new phone masts, the new Electronic Communications Code contained in the Digital Economy Act 2017 and introduced on 28 December 2017, is as a result likely to sharply reduce landlords’ income from these agreements and leave them with less control over their properties. The government in a bid to help roll out new phone masts for 5G had the bright idea to change the way mast contracts were negotiated under this new code so that instead of mutual negotiation the value was changed to alternative land use. No doubt the big telecom corporates were involved in its drafting.
In the city this value may be higher, but in the country some of these spots have very low alternative use values, as a result existing phone mast locations at the end of their contracts have seen offers from the telecom companies for annual lease values plummet from an average £6k annually to sometimes now offering as low as £32 pounds only a year.
So, in that instance you would then think the landowner could just give the telecom mast company notice, and tell the provider they can take their £200k of equipment elsewhere, but no, in the new code, the mast provider can go to Tribunal and have the value and mast site protected and withheld.
Loss of control is much greater, although, there is no right to “add” equipment, which may give landlords room to negotiate for more negligible rent. However, new rights include, to connect to a power supply; interfere with or obstruct an access route; and to lop trees have been added as well as right to keep the site, so land value could be potentially affected.
So, what’s actually happened since the new code came in? Mutual new mast agreements have now crawled to a standstill and there are cases now going to court to test the legislation, which surely needs significant amendment.
In the code there is scope for compensation in addition to rent for:
Faced with the prospects of a lower consideration, landowners are likely to claim compensation for their loss, as they can be entitled to do. Typical heads of claim will be:
- Land taken – this will vary between each site (such as between farmland/woodland, farmyard/car park etc);
- Injurious affection – this allows a landowner to claim for any drop-in value to his retained property (say to a house within sight of the mast);
- Disturbance – this ought to cover the landowner’s time and trouble in dealing with access requests, which at say five requests a year per operator could equate to well over £2,500 per annum; and
If approached, where until recently a new mast was a potential positive for land, we understand is don’t agree any offer for a mast offer without proper advice first.