Today out of home leasing and development expert Andy Goodman talks about how to begin and end your out of home advertising lease.
When should a lease begin?
The lease begins when all of the government permits have been signed off. So in California you’ve gotten your Caltrans permit, you’ve got your permits for electrical and the city has given you final inspection and signoff and you’ve turned the billboard’s lights on. That’s when the Lease begins. When I first started building billboards in the 90’s, billboard permits in the City of Los Angeles were a matter of right. I could get a Lease signed, get my sign pre-inspection done and then I could be at building and safety pulling my permit. Then 30 to 60 days later I could be building the billboard. Property owners were okay with 6 months to a year to build the billboard. Today, if I can build a billboard in a year and half we’ve done a good job.
On delays
Delays are one thing, but the most frustrating is that the property owner has not given us enough time to secure the permits and build the billboard before the Lease begins. Now we owe money to the property owner or have to ask for an extension because the billboard hasn’t been built yet. We initially ask for unlimited amount of time to build the billboard, most property owners don’t go for that, so the negotiations begin. There’s a number of things which can get in the way. Compared to the 90’s everything today is a delay. Once I have a signed Lease we begin negotiating our development agreement with the city. The question at that point is, “are we negotiating with the Planning Department, the Council Members or a hired professional that represents the City?” Eventually we make it to the Planning Commission and then to City Council. Even when you’ve gotten City Council approval there’s still a 30 day period where a property owner or another billboard company could challenge the approval by the Council. Then you get into building and safety. Also, there are potential problems getting electrical. In some areas around California we are backlogged for a year in being able to get electrical to a sign.
Removal clauses
I will never accept a lease where I have to remove the foundation of the billboard. We remove a portion of the column 6”-12” below grade and fill it with slurry and put blacktop over the hole, or we put a steel cap onto the column and blacktop over that. I prefer to pour slurry so no one can cut off the cap and accidently fall in the hole.
Timeframes for removal
We’re really busy out here. There’s a lot of new billboards being built. There’s only 4-5 construction companies. It used to be easy to remove a billboard in 30-60 days but the way schedules are now it takes a little bit more time. I’d say 90 days to be able to remove the billboard. That’s what it takes these days
Andy Goodman has 33 years experience siting and developing billboards. You can reach Andy at andygoodman.age@gmail.com.
[wpforms id=”9787″]
