Landed in the UK. Telecom operators are increasingly approaching landlords to seek to install equipment on land or buildings, whether that be a fibre cable passing through a site or a mobile mast on a roof. Although both are considered to be “telecoms agreements” the wayleaves for fibres and the agreements for mobile masts are two very different beasts legally and commercially. Knowing the key differences before you sign any agreement is vital, because the wrong structure can time lock your property, lower its value and significantly make it more difficult to develop or sell in the future.
At Arc Partners, we have constant experience advising landlords dealing with demands from network operators, infrastructure providers and mast site aggregators. Please see below what you need to be aware of about the differences between fibre wayleaves and mobile mast agreements, and what to watch out for.
What Is a Fibre Wayleave?
A wayleave is a consent given by a land owner to a telecoms operator to lay and maintain cables, usually fibre-optic broadband cable, through, under or over land. It is normally a personal contractual right, not an estate in land, which does not automatically bind other owners unless registered or the purchaser agrees to accept it.
Wayleaves are the most familiar form of consent where fibre needs to traverse private land to access a cluster of properties, a new development or business park. They usually have a relatively low environmental impact in terms of physical presence – frequently just a buried duct or overhead line – and relatively low on-going management.
What Is a Mobile Mast Agreement?
Mobile mast agreements (also known as telecoms lease or Code agreements) entitle an operator to install, operate and maintain much larger equipment on a proposed site: masts, roof-mounted antennas, cabinets, other equipment. Such agreements, generally made under the Electronic Communications Code (‘the Code’), a statutory Code introduced by the Digital Economy Act 2017, provide operators with substantial rights and landlords with relevant obligations.
Due to the fact that mast agreements relate to larger structures, involve greater power usage, and have a far greater physical and visual intrusion upon the property, mast agreements are typically formal leases and are very much more heavily legislated than a simple wayleave.
Key Differences Landlords Should Understand
-
Legal Status and the Electronic Communications Code
This is the key difference. Mobile mast leases are virtually always subject to the Code, which bestows on operators statutory rights contrary to the landlord’s usual rights under a commercial lease, such as. Post-expiry of the lease, removing an operator becomes very difficult. It also grants rights to upgrade and (subject to safeguards) to co-use with other operators, without fresh landlord approval, in many circumstances.
Fibre wayleaves on the other hand tend not to be Code agreements (even if they may be drafted as such) but are also most likely to fall under the general domain of ordinary contract and land law. This certainly allows for much greater flexibility on the part of landowners to negotiate terms, specify an end date that truly is an end date and preside over any renewal.
-
Duration and Termination Rights
Wayleaves tend to be of a shorter duration and more readily terminable, occasionally with a notice period of months rather than years. Mast agreements on the Code are protected by statutory security of tenure: even where a fixed term is agreed (usually 10-20 years), the operators can approach the courts to renew the agreement, and the landlord has to meet a very high threshold and limited grounds to refuse.
This suggests that landlords should consider the implications for their land or buildings if they enter into a mast agreement before redeveloping, selling with vacant possession, or reusing them in the medium term.
-
Financial Terms and Valuation
Since the 2017 reform of the Code, and a further edition in 2022, a different approach has been taken to the valuation of mast agreement rent. Payments are now valued on a “no network” basis, excluding the value of the site to the network operator, and has led to a great reduction in rents against historic pre-2017 agreements that in many cases is anywhere between 60-90%. Landlords with older agreements may find the renewal terms offer is significantly lower than anticipated.
Wayleave payments are not part of the statutory valuation regime. They are often negotiated on a commercial basis and, in relative terms (due to the relatively small size of the pipeline). Although they tend to be small in absolute terms, landlords have more bargaining power in the negotiations over the sum.
-
Physical Impact and Site Access
Typically a mast agreement will contain a defined demise (fenced compound, rooftop area or cabin), continuous rights of access for maintenance or upgrade works, power arrangements and may sometimes be shared use by a number of operators. This can have significant implications on insurance, health and safety, structural survey (particularly on rooftop installations) and future planning applications on the site.
In reality the impact of a wayleave is often limited to the installation of a cable rather than a building; however, sites should agree the depth of burial, reinstatement requirements and access rights for repairs, which may cause disturbance when carrying out works.
-
Impact on Property Value and Future Transactions
Due to the difficulty in re-gearing Code agreements, however, mast agreements can have a material impact on a property’s marketability and valuation, particularly where the buyers or funders are reluctant to have any masts liability on the asset. The solicitors to any prospective purchasers will look at these agreements carefully during due diligence, and lenders are likely to have certain requirements/exclusions pertaining to Code protected apparatus.
Wayleaves tend to be less of a burden on a transaction but should still be identified, considered and disclosed, in particular where the route for the cabling is likely to prejudice future development or groundworks.
-
Negotiating Position
Landlords have more scope to negotiate special terms in a way-leave- as the Code isn’t relevant in the same way, the arrangement is subject to more traditional contractual rules. With mast agreements, operators will tend to have a standard, Code-compliant terms and conditions template for the deal and if negotiations falter will fall back on the statutory regime to back up their position.
However, this doesn’t have to be the case for landlords. Informed landlords may still be able to negotiate significantly on rent reviews, break clauses, reinstatement obligations, sharing and upgrade agreements and dispute resolution provisions. However, such negotiations will require expert assistance given the complexities of the Code.
Practical Steps for Landlords
Before you negotiate, establish whether the proposed contract is (or is likely to be) within the Electronic Communications Code (it will set the parameters of the whole deal).
Seek expert independent advice at an early stage. There are long term implications to be considered in coding agreements.
See the impact on other proposals such as further sale, re-mortgaging or redevelopment, in addition to the initial income received.
Explain them precisely, the right of access, of maintenance, of sharing/upgrading and the duties of reinstatement-these provisions are as important as the headline rent.
Contrast any renewal offer to the market valuation methodology as it currently applies, in the event that you are still operating a legacy pre 2017 mast agreement.
How Arc Partners Can Help?
If you have been negotiating a fibre wayleave, new mast agreement or renewal of an existing Code agreement, it’s important to get the right advice before you sign. There are two types of agreement that involve very different risks, timescales and costs, and what appears to be a simple request can have long term effects on use and value.
Arc Partners can help landlords review, negotiate and manage telecoms agreements to agree terms that represent current market practice and protect your position for the future. If you’ve been approached by a telecoms operator or infrastructure provider, contact our team before responding
FAQs
Am I required to obtain a solicitor before signing the wayleave or mast agreement?
Yes. Wayleaves and particularly mast agreements under the Code impose significant financial and legal obligations on the signatory, and hence seeking independent legal advice is imperative for negotiating your position and property options.
Am I able to take down the mobile mast when the agreement expires?
No. Mast agreements under the Code provide security of tenure to the operators and thus removal from the property when the agreement expires might require a legal action despite serving notice.
Will the fibre wayleave affect my capability to sell the property?
Only to a small extent. Wayleaves are less intrusive compared to mast agreements; hence, the impact on selling property would be minimal despite your solicitor investigating cables, access, and reinstatement during due diligence.
Why is my mast renewal agreement cheaper than previously?
The post-2017 Electronic Communications Code reform in valuation of rents on a “no network” basis means that network value has been taken out of the formula. Many rental costs have dropped 60–90% since the old agreements.
Does my operator have the right to upgrade or install their kit without seeking permission again?
Probably yes. Code provisions grant operators statutory rights to upgrade apparatus and share sites with other operators in most cases without needing additional landlord approval, depending on the wording of the agreement.
What is the greatest danger in signing a mast agreement without thorough examination?
Loss of control. As it becomes impossible to terminate mast agreements under Code provisions, one might end up having little to no control over property usage in the future.