SpectraSite to Acquire Apex Site Management

In a move to increase the number of rooftop sites it can offer its customers, Cary, NC-based SpectraSite Holdings Inc. has signed an agreement to purchase Conshohocken, PA-based Apex Site Management Inc., in a stock-for-stock transaction valued at approximately $60 million. Apex will operate as a wholly owned subsidiary of SpectraSite.

Apex is a real estate management firm that specializes in the negotiation of telecommunications transmission and access agreements between property owners and telecommunications companies. Apex currently represents more than 12,000 properties under exclusive management agreements or master leases. The Apex portfolio contains more than 3,300 office and flex/industrial properties encompassing more than 390 million square feet. Apex's clients include 5 of the top 10 office Real Estate Investment Trusts (REITs) and 3 of the top 4 hotel REITs in the United States. The company's contracts provide for annuity compensation to Apex tied to the length of the tenancy of the telecommunications carrier.

"This is a key strategic acquisition for SpectraSite for several reasons," said Stephen Clark, SpectraSite CEO. "First, it enables us to better serve our existing customers with the addition of rooftop space in premium locations. Also, it allows us to diversify our customer base as we leverage the relationships Apex has with broadband carriers. Finally, it positions us to take full advantage of the future growth in wireless data, MMDS and in-building applications."

Apex has grown rapidly in the past several years and currently bills approximately $25 million in gross annual rental run rate on its site portfolio. Further, Apex's rent roll has been increasing at almost $1 million per month over the past several months. This robust growth has been fueled by strong demand for Apex's predominantly rooftop portfolio from both "transmit" carriers (seeking elevated locations to transmit signals to the surrounding area—e.g., PCS, cellular, mobile data, paging) and "access" carriers (seeking to provide service to tenants within the property—e.g., fixed broadband wireless, fiber access, building-centric CLECs). Apex's tenant mix is diversified, including PCS, cellular, ESMR, and paging carriers, as well as fixed broadband wireless, MMDS, and CLECs.

The transaction is expected to close before then end of the year.