St. Louis-based St. Charles Tower is a small tower company that got a big win from LightSquared, as the operator inked its first leasing deal, for six of St. Charles’ towers in Las Vegas and Phoenix as it builds out its hybrid LTE-satellite network. The $2 million estimated contract with LightSquared could boost St. Charles Tower’s book value by about 60%.
“For a smaller tower company, it’s a real big deal for us,” said Chris Puricelli, who owns the business with Robert Bell.
Ten-year-old St. Charles Towers is one of hundreds of smaller tower companies still making a living in a world dominated by a handful of really big tower firms. According to RCR Wireless News’ Top Tower Companies list, done in conjunction with Jim Fryer, president of Fryer Marketing and Media, the gap between the eighth-largest and ninth-largest tower companies —TowerCo and Pegasus Tower—is by more than 2,500 towers. At last month’s PCIA Wireless Infrastructure 2010 show, Marc Ganzi, CEO of Global Tower Partners and this year’s chairman of the PCIA board of directors, called small tower companies the lifeblood of the industry.
St. Charles Tower builds between 10 and 12 towers a year, said Puricelli, who previously worked at AT&T Mobility and with Bechtel Corp. Bell’s experience is the billboard business. The company’s strategy is to build a dozen towers, sell two-thirds of them and keep a portfolio of between 40 and 50 towers. Today the company has assets in seven states – Arizona, Illinois, Indiana, Missouri, Nevada and Texas. The company got its start with contracts from AT&T but since then, works with all of the major operators.
Puricelli said the company can take out $2 million to $3 million loans and then pay them off by selling the towers. “We kind of move in a debt-free environment and that’s why it’s easier for us to stay small.
“As you start to finance some of these towers from a smaller company to a medium-sized company, you start to look at financing and it’s a special breed in that you have a piece of property in a cell tower, which is not really real estate and not really equipment, so I think it’s difficult for the people who normally make those kinds of commercial loans to truly analyze and assess … for the types of money that tower companies need to move up from a smaller company to a bigger company. If you want to go with public financing, it’s a whole other skill set.”