Separating Crown’s Jewels: Protecting Municipal Rights and Interests in Crown Castle’s Small Cell and Fiber Asset Sales

On May 1, 2026, Crown Castle announced the close of an $8.5B transaction in which it sold its Fiber Solutions business to Zayo Group Holdings Inc. and its Small Cell business to Arium Networks. (Hereinafter, Zayo and Arium will be referred to collectively as “Transferees.”) Details of the deal, as explained by Crown, can be found here.  

This paper seeks to offer suggestions on what local governments’ legal, real estate or public works departments ought to consider as this transaction rolls out across the country. We believe the bottom line is that local governments must review the various governing documents they have entered into with Crown to know their rights and what they may demand before approving the proposed transfers. Further, it is our recommendation that local governments resist accepting blanket transfer approvals that have been or will be forwarded by the Transferees.  

The Unique Role that Crown Seeks to Transfer

Crown Castle has served as a local government's partner or tenant on property owned or managed by local governments nationwide in at least three separate capacities.

• Crown is a tenant on municipal property outside of the rights-of-way as either the owner/manager of macro cell towers, subject to local government wireless siting authority, and Crown will continue in this capacity. 
• Crown has served as either the owner or manager of small cell supporting facilities in municipal rights-of-way (small cell).
• Crown has served as a fiber optic builder/operator in the rights-of-way (fiber solutions). 

As explained above, Crown is selling off its small cell and fiber optics operations to the Transferees, a transaction that very likely requires your permission.  

Crown’s, and now Transferees’, small cell and the fiber optic businesses operate on, under and/or above the public rights-of-way. Because of their occupancy of municipal real estate (e.g., rights-of-way, poles, street furniture and existing conduit), Crown was first required to negotiate the rental terms for said use and then, separately, to obtain regulatory permission for the construction and operations of their small cell and fiber optic enterprises.

Necessary Components of Transfer

Operating two separate, but integrated, services in a shared municipal space demanded the creation of an intimate relationship between Crown and the host municipal governments. Because of this partnership, typically the real estate and regulatory agreements make very clear that no transfer of the rights provided in each document could take place absent the consent of the municipality. Such permission is typically based upon the prospective transferee demonstrating that they are legally, technically and financially capable of stepping into the place of Crown and agreeing to be bound by the terms of the agreement. Terms required by the municipality could include things such as:

• Demonstrating that the transferee is registered and qualified to do business in the municipality’s state;
• Providing documentation that the transferee is authorized to provide the services that Crown had used as the basis for its claim to use the public’s property;
• Presenting proof of insurance in the agreed-upon amounts from an insurer that meets the qualifications outlined in any agreement, permit or established in the municipality’s code;
• Affirming that the transferee agrees to be bound by all the terms of the agreements Crown entered into, including the indemnification of the municipality and its officers and agents;
• Updating emergency contact numbers/emails and the parties upon whom notices should be served as outlined in the governing documents; and 
• Reimbursing the municipality for expenses associated with these transfers.

Where You Can Find Crown’s Promises that Transferee Must Adopt

There are a number of locations where Crown made binding representations to local governments. These are representations that local governments have the right to enforce, but enforcement will only take place if local governments affirmatively take steps to enforce their rights. Below is a non-exhaustive list of documents to review to discover what Crown, or more likely one or both of the Transferees, must provide to earn the transfer:

• Lease/License or Franchise Agreement
• Permits
• Municipal Code

Recovery of Expenses

Transfers require hands-on management by municipal landlords and other professionals. Counsel should require that the time and costs the landlord expends by employing professionals to help advise it be recoverable. These additional professional fees can add up quickly and could exceed the rent payments the landlord receives. These recoverable costs should include legal counsel’s fees.

Transitional Issues of Which to Be Aware

1. Where the fiber asset begins and where the small cell facility ends. 

The demarcation of what is a fiber asset and what is an extension of the small cell’s wiring is not always clear. Moreover, because Crown was providing both services, the demarcation point was not as important. That changes with this transfer(s). What may have been a single lease or franchise to govern both components, because Crown was a single provider, must now be bifurcated to address the obligations and rights of each company. Perhaps this demarcation point will be better established by the Transferees, but neither BBK nor our clients have seen any such clarification. You should demand that clarification, and you might want to do this with both Transferees at the same time.

2. When and where to pay the new Transferee if you are a Crown customer. 

Fiber services are typically purchased on an annual basis and in advance. If a municipality paid Crown for a fiber connection in January of 2026, but Crown transferred its interest to Zayo on May 1, 2026, will Zayo honor the terms of the Crown agreement? If the municipality pays Crown’s invoice, but accepts services from Zayo, is the municipality in breach to Zayo? Or, if the municipality waits for clarification, is it vulnerable to losing services for failure to pay? Why hasn’t this message or predicament been clearly communicated to Crown, now Zayo customers?  

These are just two examples of operational questions that will arise from this massive transaction. The parties benefitting from the transaction, and not municipalities, should bear the burden of resolving each.

For questions regarding the Crown Castle transaction and local government rights and interests, please contact Gerard Lavery Lederer.

Disclaimer: BBK Legal Alerts are not intended as legal advice. Additional facts, facts specific to your situation, or future developments may affect subjects contained herein. Seek the advice of an attorney before acting or relying upon any information herein.