Leases to Telecommunications Firms – Things to Consider

From time to time, high-rise condominiums are approached by various telecommunication providers asking to allow antennae and other equipment to be installed on the building’s rooftop. Many high-rise condominium boards see the annual rental being offered by the telecommunication provider as an easy way to help balance the corporation’s budget without any risk to the condominium corporation.

More careful condominium boards, however, will consider the overall impact of such an arrangement, and weigh the benefits of ongoing rental payments with the issues that come with the installation. I will highlight some of these considerations.

A lease of part of a common element to a telecommunication provider requires a by-law pursuant to Section 21 of the Condominium Act. The exception in Section 22 to “Telecommunication Agreements” relates only to network upgrades within the condominium and not to third-party leases. To pass a by-law, there must be a vote of owners, with a majority of all units in favour of it. A condominium board must be satisfied that the necessary votes are available to pass such a by-law.

The location and configuration of the antenna system on the building roof also sometimes causes concerns to owners. The board will have to determine whether the owners will consider the installation as detracting from the building’s look.

There are also other concerns. Will the installation interfere with existing leases that the condominium corporation may already have in place? Will the installation interfere with current or proposed telecommunication reception received by the residents? Will the installation and ongoing maintenance of the antenna and equipment interfere with the use of the common elements by the residents? Will the telecommunication tenant be paying the condominium corporation’s legal fees and engineering costs (related to the lease and the equipment)?

A condominium board is wise to consider the overall impact of what a telecommunication installation will mean both to the building and to the lifestyle of the residents. Only when these issues have been considered and resolved can the board then negotiate the lease terms.