Small cells and Het Nets may be all the buzz right now, but Skyway Towers is quite busy themselves building cell towers in strategic locations. The Tampa, Fla., based company averages from 50 to 70 new tower builds annually.
“For the next two or three years, we are going to see a lot of development in the urban and suburban areas, and after that, network expansion will occur in the rural areas,” Skyway’s President and COO Scott Behuniak told AGL Bulletin.
As a matter of course, Skyway Towers has closed a $15 million debt facility with USAmeribank and Raymond James Bank, which follows a $75 million equity commitment from its partners, Tinicum and Permit Capital Private Equity Fund.
The tower segment has not always been seen as a prime lending target for debt, however. Large institutions were not interested in tower companies, unless they had a substantial amount of tower cash flow, Behuniak said. But the stability of the tower market is changing some minds on Wall Street.
“Four or five years ago, even regional banks would not look at [small and mid-tier tower companies]. Now towers are seen as a very safe place to put money. The debt markets are seeing the same thing we are: significant, robust growth in the carriers’ needs for additional towers and additional equipment to go on the towers,” he said.
While he expects tower growth from all the carriers as they compete for coverage and capacity, Behuniak said AT&T has been the most aggressive recently.
“The T-Mobile acquisition attempt put AT&T into analysis-paralysis for about a year, so now they are trying to catch up,” he said. “We are seeing a lot of new builds from both Verizon and AT&T. T-Mobile is going through all of its upgrades now, so we expect them to begin expanding the network next year.”
After a prolonged bidding war, Sprint acquired Clearwire and completed its merger with Softbank this month and it now looks like it is set on a tower growth trajectory.
“Our expectation is that Sprint will emerge from its slumber some time mid to late next year on new builds,” Behuniak said. “They are running with their hair on fire right now trying to get everything modified.”
In a way, it is the best of times and the worst of times for the tower industry. With so much work available, it is difficult for companies like Skyway Towers to get crews.
“In the past we would have four or five construction vendors vying for the job. Now we are lucky to get two,” Behuniak said. “They are so busy doing mods and upgrades for the carriers.”