Neil Bell interviewed Franklin Outdoor President Dan Franklin on the Bell Board Podcast. Franklin Outdoor is a third generation family owned out of home company in Minnesota.   Here are the highlights.

The case for easements

One of the things that I think Grandpa was always big on, and my father too…is we like to own as much real estate or easements or that type of stuff, just kind of create that security…When Grandpa started off, he probably made more money buying land and you know developing it and flipping lots off and just keeping corners for the billboard and kind of…We own the land or easements under thirty percent of our sites, which ends up you know at thirty five percent of the revenue..If I’m going to go buy an easement…I kind of want to make sure I know the future road plans…Are they going to bypass town?… Some operators don’t like easements because they can’t depreciate them. Obviously, if it comes down to buying an easement or building a billboard, you’re better off building the billboard. But that doesn’t mean they’re not mutually exclusive. You can do both..if you pay 10x an easement, that’s a 10 percent return on your money on an asset that you have no risk in because it’s your billboard.

Three things to look at when doing an acquisition

Look at each structure.  Is it wood? Is it steel? What is the shape of the steel and lights? Then the ground leases, and then the add contracts, the revenue. And usually, when I’m doing an acquisition, I like to go in and buy something where one or two of things are…not good. And then go and fix them in…The revenue is not there, or the lease needs some work. That’s where you can build…Buying a well – run billboard company is not cheap…I like to buy the headaches and the mess.

On the benefits of using Outdoorlink to manage lights

We’ve got Outdoorlink on about half our structures on it right now…We started on the lights furthest away from our office…where we knew…we weren’t going to be up there as often. It used to be easy back when…we had two hundred faces. Well, you drove by most all of them at some point tonight, and you could tell if a light bulb was out. But now that some structure are four hours away from our shop it’s hard to do light rides.

You can watch the entire interview below.

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