Why We Invested In SBA Communications

Dear Landlords,

I want to extend a warm welcome to all our new members! We recommend that you start by reading our Welcome Letter by clicking here. It explains why we invest in real estate through REITs and how to get started.  

As a reminder, our most recent "Portfolio Review" was shared with the members of High Yield Landlord on July 3rd, 2024, and you can read it by clicking here.

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New members can start researching positions marked as Strong Buy and Buy while taking into account the corresponding risk ratings.

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Important Note:

Just recently, we initiated a position in SBA Communications (SBAC) as part of our Core Portfolio, and today we are sharing our full investment thesis.

You can read our Trade Alert by clicking here.

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Why We Invested in SBA Communications

SBA Communications (SBAC) is a telecommunications infrastructure REIT with operations across the globe and two primary business segments: Leasing and Development.

Leasing is exactly what it sounds like. SBAC owns or otherwise controls (via ground leases) telecom infrastructure such as towers, distributed antenna systems, or small cells and leases space on them to wireless communication carriers.

Development involves partnering with carriers to meet their needs through ground-up development of new infrastructure, including site selection, zoning, construction, and equipment installation.

SBAC operates in multiple regions around the world, primarily North America but also South & Central America, select regions of Africa, and the Philippines. Of SBAC's 39,638 infrastructure sites, almost 17,500 are located in the United States. The rest are international.

Though construction of new tower sites is now extremely limited in the US, other regions of the world are still increasing tower count, which gives SBAC avenues to pursue additional growth through its Development segment.

During Q1 2024, for example, SBAC built 76 new towers across the world.

Why has SBAC sold off so heavily over the past few years?

Data by YCharts