Investing in Cell Tower Leases with a Self-directed IRA

Published on January 6, 2026

There is a niche in the real estate market that’s ripe for self-directed investing: cell towers. Individuals with a self-directed IRA (SDIRA) can diversify their portfolio by including cell tower leases or other tower-related investments within their retirement plan.

Cell tower basics

Cell towers are critical infrastructure for wireless communication. They are leased by major carriers to host their equipment and the towers can support multiple tenants. These can be good long-term investments, as lease agreements usually run from five to 30 years, with built-in rent escalations and renewal options.

Cell towers are not only the tall macrocell structures that resemble TV and radio towers; they may also be small cell structures in public spaces that may also incorporate outdoor lighting.

According to the Wireless Infrastructure Institute, in 2024 there were more than 154,800 purpose-built towers and 445,900 macrocell sites and outdoor small cells in operation, and investment by the U.S. wireless infrastructure sector was over $63 billion.

Benefits of cell tower investment

• Stability – This alternative asset class offers a stable, long-term income stream that—like so many others—have low correlation to traditional stocks and bonds. Typical leases with major wireless carriers and large tower companies are 10 years with five-year renewals. The renewals can stretch out that cash flow for 25 or more years.
• Inflation safeguard – As a hedge against inflation, look for cell tower lease agreements that have built-in yearly rent escalations that are agreed upon in advance; these help make cell tower investments somewhat inflation-proof.
• High growth potential – With the increasing demand for wireless data from consumers and 5G network buildouts by wireless carriers, there is high potential for strong growth from this sector. And because towers can accommodate up to four different tenants on one structure, this increases revenue potential per site.
• Low maintenance – Wireless carriers (the tower tenants) are the parties responsible for maintaining their equipment, which helps deliver a high margin return for the tower owner. In addition, cell towers use triple-net leases which means the tenants (the wireless carriers) pay the property taxes, insurance, and maintenance expenses plus their rent. Therefore, the expenses the SDIRA would have to pay will be relatively low (if anything).

Other ways to invest in the cell tower market

In addition to investing in the tower leases, the SDIRA can directly purchase and own the ground lease of the existing tower itself, or invest in a publicly traded tower REIT (real estate investment trust) or infrastructure fund that specializes in this growing real estate asset class. Tower REITs lease space to cell phone and other telecommunication providers.

Investors can also include private equity funds that operate in the cell tower space (and buy shares in tower-owning companies) within their SDIRA.

As long as the transaction complies with IRS rules and the plan custodian gives the green light, the investment is a go (with the assumption that the account owner has performed due diligence about the asset class, has reviewed the lease agreements or fund prospectus, and understands they are responsible for management or oversight of the investment.

Potential downsides of cell tower investments

Investors should be aware of possible sensitivity to interest rate increases; zoning regulations and regulatory shifts that affect the industry; municipal and public concerns about the structures’ impact; and understand how asset valuations are derived as well as how emerging technologies may affect the cell tower market.

Another niche real estate investment: billboards

Billboards are ubiquitous along highways and like cell towers, they are a niche real estate investment that is less correlated with stock and bond markets, so they offer a hedge against market volatility and inflation. And as with many alternative assets, they can deliver steady, contractual passive income over the long term.

The self-directed retirement plan owns the land or the billboard structure (along the highway or high-traffic urban centers). Investors earn returns by leasing the advertising space to advertising or media buying agencies.

ROI is especially strong for digital billboards that can host multiple ads and advertisers, providing increased revenue per board. When the SDIRA owns the billboard itself, the account owner can contract with a third party to handle the leasing and renewals of the billboard space, which avoids any inherent issue with the account owner providing services (self-dealing, a prohibited transaction).

Among the areas investors should research are site location, regulatory compliance matters, and lease terms in the local market.

Want to know more about investing in all sorts of alternative assets through a self-directed IRA? Give our team a call at 888.857.8058 or email NewAccounts@NextGenerationTrust.com with your questions about self-direction as a powerful retirement wealth-building strategy that builds on assets you already know and understand.