GlobeSt.com SPECIAL: Telecoms, Building Owners Prep for New Battle

ORLANDO-The five-year-old battle over unlimited access to office buildings and apartments by national telecommunications companies is heating up again. A July 27 Massachusetts Superior Court decision triggered the new clash. The ruling appears to favor property owners.

But the Washington, DC-based Association for Local Telecommunications Systems tells GlobeSt.com it will appeal the Massachusetts ruling and continue to push for free access to properties. The trade group represents 150 corporate members.

GlobeSt.com polled key trade associations, brokers, lawyers and owners for their views.

Jonathan Askin, ALTS’ general counsel, feels the Massachusetts court ruling missed the mark. He tells GlobeSt.com the court should have paid more attention to a July 6 decision by the US Court of Appeals in the District of Columbia.

The appellate court ruled tenants could install satellite antennas in their rented portion of the building without prior permission from the building owner. That would mean a telecom company could access the building on a tenant’s request and by so doing would open the door for other telecom firms to follow, ALTS president John Windhausen Jr. says in an Aug. 6 article in The Wall Street Journal.

Askin tells GlobeSt.com his group is encouraged by a recent New York Public Service Commission ruling that gives telecom firms direct access to telecom facilities in multi-tenant buildings owned by another carrier.

In Central Florida, BOMA/Orlando president Bert Locke sees unlimited access as strictly a private property rights issue.

“The simple resolution is to stop the legislative initiatives and come to the table, willing to negotiate terms,” Locke tells GlobeSt.com.

He says “the tenants, the telecoms and the property owners will all achieve what we’re trying to achieve if we allow the free enterprise system to work.”

Locke says “an unconstitutional taking that’s even more egregious than eminent domain cannot be allowed to occur” because “our Constitution protects us from this type of taking.”

The BOMA/Orlando president says property owners “are anxious to work with providers with whom our tenants want to conduct business. It is in our best interest to respond to the needs of our customer.”

Locke adds, “We cannot, however, allow our constitutional rights to become violated for the sake of one group’s desire to take something they should be willing to earn.”

George D. Livingston, a property owner and founder/chairman, Realvest Partners Inc., sees the ongoing dispute between telecoms and building owners as a no-brainer.

“Access should be tied to clients,” he tells GlobeSt.com. “If the provider has a client, they should get access. When providers do get access, they should pay for the space they use for their equipment.”

Livingston says, “There is no need to let an unlimited amount of providers into the building if they have no clients. However, they should be allowed to market tenants to seek clients, as any vendor can.”

But, he adds, “economics will, in the end, dictate this to be unfeasible in the extreme sense.”

Christopher T. Sproles, first vice president, CB Richard Ellis Inc., Orlando, supports BOMA’s position. “Owners should have the ability to make their own decisions as to what is best for their building and their tenants,” Sproles tells GlobeSt.com.

“If a tenant needs something a competing building can offer, that owner is going to work to provide that amenity, no matter what it is,” the broker says. “This is especially true in today’s market where owners are fighting to keep and attract tenants.”

While building owners should be able to decide who gains access to their property, Sproles also feels tenants should have the right to select their own provider.

“If a telecom provider is not servicing a particular building, they can always subcontract with other existing providers to gain access,” the CBRE executive says. “It’s in the owner’s interest, however, to have enough telecom providers to give tenants multiple options and provide some level of competition for service.”

Sproles says, however, “there are many issues from a owner’s perspective on this issue” and at least three main points. First, telecom providers typically require both riser space and a small space for some racking equipment.

“Owners may or may not have that space available but they should not be obligated to provide space to a third party, whether it is free or for a fee,” the broker says.

“Secondly, many of these companies are not financially sound, leaving owners responsible for cleanup or potential damages,” Sproles points out.

“The third reason is simply the free enterprise argument that owners should have the ability to make their own decisions as to what is best for their building and their tenants.”

On the question of resolving the dispute by giving building owners a slate of three or four telecom companies to offer tenants, Sproles doesn’t feel that tactic would work.

“If you have the telecom companies make the call, the problem is that it will be all of the big boys squeezing out the smaller and sometimes more competitive providers,” the broker says. “You may have somewhat of a cartel system in not only determining who gets to play but ultimately where fees and rates are set.”

BOMA/South Florida president D. K. Mink also feels telecoms shouldn’t have free or direct access to office buildings and apartments.

“The telecommunications industry is in disarray,” Mink tells GlobeSt.com. “Small carriers are going out of business and abandoning their equipment and wiring inside buildings, and that leaves the tenant exposed.”

New technology issues are also arising. “We are finding that some of the new energy-efficient lighting systems being installed interfere with wireless telecommunications,” Mink says. “These are issues the market should resolve, not the government, and never at the price of private property rights.”