Jan 13, 2019 - 08:49 PM
American may or may not charge their tenant for the revenue share %. It depends upon their agreement with their tenant. Since they can't tell you which tenant will sublease in the future, how they can know that the sublease tenant will have a revenue share reimbursement clause in their agreement with American Tower is beyond me.
The short answer is that there is no standard revenue share- it varies pretty widely and depends upon the underlying circumstances. Less than 20% of leases have revenue sharing of any type in them. Tower companies will pay lower base rent and higher revenue share and vice versa- so the answer of what an appropriate revenue share should be is based upon what the lease rate is currently and whether it is expected to increase with the amendment.
Candidly, I would be reluctant to reduce the revenue share unless you can figure out whether there is likely to be additional tenants in the future or not. If the probability is low, we recommend to our clients to get rid of the revenue share and focus on increasing the base lease rate instead.
If you need help with figuring any of this out- please let us know.