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CHICAGO-It seems like a building owner’s dream come true, attorney Jay A. Gitles says, or “found money” on their rooftops. However, the partner in the corporate and real estate practice group of national law firm Seyfarth Shaw cautions clients to be as careful signing a lease with a telecom company seeking rooftop space as they would with a potential tenant under the roof.

While the proliferation of cell phones and pagers has resulted in a land rush of sorts on rooftops from the Central Business District to the suburbs, it has not been without pitfalls. Just as some dotcoms imploded, telecom companies also have merged or gone out of business. When that happens, who’s in charge of removing the equipment and repairing any damage on the roof?

“Have you ever tried to get a ghost to do something?” Gitles asks rhetorically. “It goes to the security deposit issue and letters of credit to make sure you can recover the costs.”

Fortunately, none of Gitles’clients have had to deal with a bankrupt rooftop space tenant. He takes preventive measures in the case of mergers. “We usually cover it with assignment and sublease clauses,” Gitles tells GlobeSt.com. The successor company must have a net worth and credit that is at least equal to the original lessee, he explains.

“A lot of times, a landlord doesn’t spend a lot of time looking at financials,” Gitles adds. However, building owners are advised to do as much due diligence as they would for a tenant taking square footage inside the building, he says.

The aesthetic issue of rooftop clutter hasn’t been a factor in Gitles’ deals. “For the most part, the companies are doing a good job of camouflaging the equipment, and year by year, it’s getting smaller,” he explains.

Also, in the case of class A space, building owners themselves won’t agree to any rooftop deals that would turn off potential tenants, Gitles says.

Some tenants may have technical issues, Gitles notes, such as an audio recording company that went ahead with a lease deal after testing for interference from rooftop equipment.

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