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Oscar Toledo
  • Investor
  • Austin, TX
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Billboard lease proposal...how much for a lease? $1000? $2000?

Oscar Toledo
  • Investor
  • Austin, TX
Posted Aug 20 2014, 15:15

We own some commercial property on a very busy highway. 250,000 cars pass by everyday. We recevied a proposal from a billboard company to build a full sized billboard. the research has been conducted and a written lease has been written and presented to us for 1k/mo, 20 years + 20 yr option, with 10% rate increases every 5 yrs. We are very interested, but what is a fair rate? I think that billboards here run $5000-10000 (maybe more?) a month here because it's so busy, but I'm not really sure.

From what I'm told and from what I've researched, you can expect to recevie about 15% to 20% of the gross monthly revenue that the billboard company gets. I am also going to required annual increases in rent based on the CPI index, among a few other things.

Does anyone have experience with this? I don't want to have any regrets.

Thanks in advance for your responses! 

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