When Lodestar Towers Inc. purchased 160 pine-studded acres high in the San Gabriel Mountains two years ago, it wasn’t for the crisp mountain air or the million-dollar views.
Lodestar bought the property on Mt. Harvard, just down the hill from Mt. Wilson, to position itself as a major landlord in the obscure but fast-growing communications site-management industry.
Part high tech, part real estate, the business of owning, renting and operating transmission towers and antennas for communications companies is booming, thanks to new mobile communications technologies and the impending arrival of digital television.
On Mt. Harvard, Lodestar plans later this month to begin building a facility to house as many as four digital TV broadcast stations, six FM stations and 400 antennas for wireless communications. It will vie for clients with facilities that already sit on leased U.S. Forest Service land on Mt. Wilson.
Companies such as Lodestar, Calabasas-based Meridian Communications and Point Richmond, Calif.-based Diablo Communications Inc. are also going after less lofty sites: building roofs, church towers and even flagpoles that can host the many small antennas needed for new cellular phone and two-way paging services.
“We saw an opportunity when we saw that the business was moving away from a predominantly mountaintop business to a mountaintop and low-elevation business,” said Jerry Lindquist, president of Diablo, a family-owned company that has been in business since 1958 and owns about 90 sites around the state.
While the antennas and transmission towers are ubiquitous throughout Southern California’s mountainous terrain, the site-management industry remains mostly out of sight. It is an intricate web of landlords and tenants who rent space from one another and sublet facilities to third parties.
On Mt. Wilson, for example, where an eclectic mix of towers, antennas and buildings fill the mountaintop, Meridian rents space from NBC. But NBC and other broadcasters are tenants at Meridian facilities on other Southern California hilltops.
Some of the players in the industry are solely in the transmission-tower business, while others are communications service providers--including Pacific Bell and Motorola--that want to run their own towers and antennas. The Site Owners and Managers Assn., a subgroup of the Personal Communications Industry Assn., currently has about 130 members, and the number of transmission towers nationwide is expected to grow from the current 40,000 to 100,000 in the next few years.
While mobile communications have driven the antenna boom so far, digital TV should give a nice boost too. The new technology, which promises to bring sharper and crisper images to America’s living rooms, will force broadcasters to find new transmission space.
And those that expand within their own facilities may force out some of their tenants--cellular, wireless and personal communications companies--which, in turn, will be looking for new space.
Those are some of the clients who are likely to be drawn to Lodestar’s Mt. Harvard facility, says company President Ronald Gibbs. And there’s another factor that could lure communications providers to Mt. Harvard: In 1995, the Forest Service, which owns much of Mt. Wilson, revamped the fees it charges companies to base transmitter facilities on national forest land. The fees, which used to be nominal, will rise to as much as $45,000 annually for TV broadcasters and $10,000 for private mobile radio services.
Although the rate hikes are not likely to affect major broadcasters, they may put pressure on small mobile radio services and wireless operators, Gibbs said.