Billboard Insider readers think lease renewals is the biggest risk in the out of home business.  34% our readers think that “Leases are subject to renewal risk” is the biggest risk.  Out of home leases carry a fixed term.  There’s a risk that you might not be able to renew the lease at the end of the term.

What the public US out of home companies say:

• Clear Channel’s 2025 10-k says this about renewal risk: “The success of our business is dependent upon our ability ot obtain and renew contracts with municipalities, transit authorities and private landlords, which we may fail to do on favorable terms or at all.”
• Outfront’s 2025 10-k says this about lease renewal risk: “A majority of our display locations are leased, and a significant portion of those leases are month-to-month or have a short remaining term. If our competitors offered a lease display locations at rental rates higher than the rental rates we offer, we could lose display locations and could be pressured to increase rental rates above those. We currently pay to site landlords, which would have an adverse effect on our business financial condition and results of operations.”factories.
• Lamar’s 2025 10-k does not highlight billboard lease renewal risk because it owns land under 1/8’s of it’s signs and because it says “there is no significant concentration of displays under any one lease”.  It does highlight, however, that the logo sign contracts are subject to state award and renewal and the company’s transit contracts are subject to renewal risk.

When is lease renewal a risk?

(1) A new landlord who hates billboards.  They will refuse to renew the lease when it expires.  Billboard Insider can think of a case where a city which does not like billboards bought a parcel of land from a private individual and then refused to renew the billboard lease when it expired.

(2) A parcel of land is developed.  Billboard Insider is aware of a case where a billboard lease had a development takedown clause and the landlord asked the billboard to be removed so that the property could be developed.  Development risk is greatest for a rapidly urbanizing area.  We are aware of another case where a landowner wished to expand a building.  Although the billboard was not in the way of the expansion, the zoning commission required the removal of the billboard as a condition of granting a variance to expand the building.

(3) Another out of home company attempts to jump the lease.  We think this risk is overstated.  In 30 years of involvement in the business we have only see a handful of cases where an out of home company had a competitor jump a lease.  If you treat your property owner fairly, they usually won’t shop.  In addition, many billboards are non-conforming so can’t be rebuilt if they are taken down.

How can you mitigate lease renewal risk?

(1) Treat your landlords fairly.  Pay them promptly.  Stay in touch.  Let them know when you’ll be on the property to change vinyl or maintain a digital and clean up carefully when you are done.  A happy landlord won’t shop.

(2) Insert a clause in your leases enabling you to relocate a billboard somewhere else on the property in the event of development.

(3) Insert automatic renewal language in your lease which ways that the lease will renew for a like term unless a landlord give you notice at least 60 days prior to renewal that they will not renew.

(4) Buy an easement under your billboard.  This eliminates lease renewal risk.

What are you strategies for mitigating lease renewal risk?  Email davewestburg@billboardinsider.com and we’ll run a follow-up story.

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