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Digital Billboards Boost Commercial Property Values
By Staff Writer
July 5, 2017
New Zealand -Digital billboards are adding value to commercial buildings by providing steady and lucrative revenue streams to supplement tenant leases.
"Strategically located commercial properties both big and small can be prime contenders for digital billboards," says John Church, national director commercial with Bayleys.
Church says digital advertising is still in its infancy in New Zealand - with the country's first digital billboards launched only four years ago - but outdoor advertising firms are increasing their digital foothold.
He says the format is known in advertising circles as digital out-of-home or DOOH and it is reshaping the way advertising operates.
"Globally, DOOH is the fastest growing format in outdoor media, with accountancy firm PricewaterhouseCoopers predicting that DOOH advertising revenues will overtake traditional spend by 2020.
"DOOH is seen as a valuable advertising platform because of its ability to reach consumers. Television, radio, or print adverts can be very easily avoided whereas DOOH ads can be situated almost anywhere and audiences can't turn them off."
In identifying key billboard sites, influencing factors include traffic counts, lines of sight, demand profiles, likely audience profile and exclusivity or volume of other billboards in the area.
Church says sites are typically assessed on a rate and occupancy formula and then commercial rental levels are determined on an equitable basis. In a number of cases, the DOOH provider maintains the wall or ground area where the digital billboard is located, which also aids the landowner. In most cases, the providers run the compliance programs, taking on the work, cost and risk toward the mutual betterment of the property.
"Revenue from digital billboards will vary from site to site, but most landlords can expect double the rental for a static billboard. The main value is derived from the annual lease fee and the length of the lease term."
The biggest DOOH billboard in New Zealand is the three-story-high, 265sq m screen that wraps around newly renovated 125 Queen St in Auckland's CBD.
APN Outdoor and QMS NZ are the major DOOH providers in New Zealand and together occupy scores of prime sites in Auckland, Hamilton, Wellington, Queenstown and Christchurch.
Church says DOOH experiences are not restricted to the outside of buildings; digital boards within lobby or foyer areas and lifts can also provide a revenue boost for building owners.
"Although the aim of these boards is to provide building directory information, they can also be a platform for full motion digital advertising and localised content such as news and sport, financial information and weather forecasts.
"They are seen as a part of the package for modern, A-grade buildings, bringing a hotel lobby experience to a corporate environment and, although not as massive an earner as large-scale digital billboards or naming rights, they can be used, in conjunction with other facilities, to justify premium rents."
Church says recent advances in DOOH technology could soon see tall buildings beam 200m-tall adverts into the sky. British media technology company Lightvert has patented a device that will enable advertisers to project large-billboard size images without the need for a billboard.
Lightvert's technology called ECHO uses augmented reality and high-speed light scanners to project images from reflective strips and can be placed on the side of tall buildings for maximum effect. The imagery is generated using only a single vertical line of light and, as such the image does not exist in reality, but only on the retina of the viewer.
Lightvert, which aims to produce its first commercial units within the next 12 months, says the hardware's small footprint can get around planning permission barriers and unlock vast amounts of new, high-value advertising real-estate.
The company says ECHO technology will allow the owners of high-rise real estate owners to 'monetise' the facade of their building in ways other technologies cannot.
Indiana Town's Sign Ordinance Withstands Motion for Preliminary Injunction
By Brian J. Connolly
July 12, 2017
Last week, a federal district court in Indiana ruled that the enforcement of the City of Bedford's sign ordinance would not be enjoined, finding that the sign code was content neutral, supported by a significant governmental interest, and narrowly tailored. The court's denial of the preliminary injunction indicates that the ordinance is likely to survive constitutional scrutiny.
The Bedford sign ordinance was challenged by an individual, Sam Shaw, who sought to display political signs, which were characterized by some as "offensive and mean-spirited," in his yard. The ordinance contained sign classifications based on certain physical characteristics, i.e. flags, temporary signs, and permanent signs, with size, height, and setback requirements. The sign ordinance also prohibited permanent signs in residential yards. Although the plaintiff conceded that the ordinance was content neutral, he challenged the law based on the underlying governmental interests and narrow tailoring.
Reviewing the plaintiff's motion for preliminary injunction, the district court agreed that the government's stated interests in aesthetics and traffic safety were sufficient to support the sign ordinance. Although the plaintiff argued that the total prohibition on permanent signs was not narrowly tailored to the city's interests, the court deferred to the city's aesthetic and traffic safety judgments that permanent signs could have greater impact than temporary signs. The court also found that the ordinance provided ample alternative channels for communication, because the ordinance allowed the display of temporary signs.
Lamar Advertising Company Announces Acquisition of Airport Advertising Contracts from Corey Airport Services, Expanding Media Inventory in Eight Airports Across the U.S.
By Staff Writer
July 5, 2017
Baton Rouge, LA - July 11, 2017 - Lamar Advertising Company (Nasdaq: LAMR), one of the largest out-of-home media companies in the world, today announced that it has closed on its recent acquisition of eight airport advertising contracts from Corey Airport Services. The acquisition adds a variety of traditional static displays, dynamic digital displays, wraps and clings, interactive exhibits, and custom advertising displays in eight major airports, enhancing Lamar's airport advertising portfolio in major cities across the U.S.
The new airports include:
Dallas Love Field (DAL) | Dallas, TX - DAL is the home of Southwest Airlines with 15.5 million annual visitors.
Louisville International (SDF) | Louisville, KY - SDF draws in thousands of visitors for the annual Kentucky Derby and hosts nearly 3.4 million passengers each year.
Palm Springs International (PSP) | Palm Springs, CA - PSP serves as the transportation hub for the resort city of Palm Springs and all destinations in California's beautiful Coachella Valley.
Northwest Arkansas Regional (XNA) | Bentonville, AR - Located near Fayetteville, Springdale and Bentonville, XNA supports growing business travel spurred by Walmart, headquartered in Bentonville.
Myrtle Beach International (MYR) | Myrtle Beach, SC - MYR hosts nearly two million passengers each year, most of whom are leisure travelers and tourists.
Punta Gorda (PGD) | Punta Gorda, FL - Serving as a regional passenger hub for business and leisure travelers in southern Florida, PGD is one of the fastest-growing airports in the country.
Monterey Regional (MRY) | Monterey, CA - MRY serves as a destination airport for tourists visiting the Big Sur and elite resort destinations such as Pebble Beach and Carmel-by-the-Sea.
Rick Husband Amarillo International (AMA) | Amarillo, TX - Only six miles from Downtown Amarillo, AMA serves as the largest passenger airport in the Panhandle region.
Lamar also has an agreement to acquire the airport advertising contract for Birmingham-Shuttlesworth International Airport (BHM) in Birmingham, AL. Following that transaction, Lamar will operate advertising concessions at 20 airports that serve more than 150 million passengers annually.
"We are thrilled to continue expanding our airport advertising business and to bring the Corey Airport Services team on board," said Lamar chief executive Sean Reilly. "Corey has established successful airport advertising programs in some of the nation's fastest-growing airports. We look forward to extending their proven operating model and to offering our advertisers the most innovative creative concepts in Lamar Airports."
Brig Newman, who served as President of Corey Airport Services, will oversee Lamar's eastern U.S. airport markets as General Manager. Newman is experienced in all aspects of airport advertising, including the design of airport advertising programs, airport advertising display concept strategy and approval, airport relationship management, and installation project management.
Financial terms of the transaction, which closed July 1, were not disclosed. To learn more, please visit www.LamarAirports.com.
About Lamar Advertising Company
Founded in 1902, Lamar Advertising Company (Nasdaq: LAMR) is one of the largest outdoor advertising companies in the world, with more than 330,000 displays across the United States, Canada and Puerto Rico. Lamar offers advertisers a variety of billboard, interstate logo and transit advertising formats, helping both local businesses and national brands reach broad audiences every day. In addition to its more traditional out-of-home inventory, Lamar is proud to offer its customers the largest network of digital billboards in the United States with over 2,600 displays. Please feel free to explore our website www.lamar.com or contact us at firstname.lastname@example.org for additional information.
By Staff Writer
July 13, 2017
Tell us about the transaction and how you were involved.
Interestingly, the transaction involved a swap of big market assets for smaller market assets, which you typically don't see. JFC initiated this transaction and advised Independent on its side of the deal. Independent operated a number of terrific, high-profile digital bulletins in the Boston DMA. In exchange for its Boston assets, Independent acquired several hundred bulletin displays across six states-Wisconsin, South Carolina, Georgia, Tennessee, Illinois, and Missouri.
Why would Independent pursue such a deal?
Yes, the markets are certainly smaller than Boston but with this swap Independent acquires footholds in DMAs like Milwaukee, Green Bay-Appleton, Madison, Greenville-Spartanburg-Asheville-Anderson, Columbia, SC, Myrtle Beach-Florence, Chattanooga, St. Louis, and Springfield, MO, among others. These are dynamic markets with some really great opportunities for digital conversions, new billboard development, and acquisitions. Also, the client profile of local and regional advertisers better fits the Company's business model. Independent goes from being a regional player in New England to operating over 1,000 displays in the Northeast, Southeast, and Midwest. They're now a real sizable player in the OOH industry.
What are the benefits of pursuing a swap transaction?
JFC has advised on several swap transactions over the years, though this is the largest. We've worked on deals that are pure like-kind exchanges, as well as more complex, hybrid deals where consideration paid to the client takes the form of cash plus billboard assets. Our clients typically find themselves in positions where they have assets that are outside their operational and/or investment profile and would like to find a way to unwind them. More often than not, when clients are faced with those situations, we are brought in to sell those assets for cash. Generating cash can be a great outcome but we also encourage clients to explore swap opportunities, if nothing else for the tax advantages. When we have done swap deals in the past, it's amazing how often both parties extract better performance from the assets they acquire in the swap, respectively. Both parties usually end up saying, 'I wish I had done this sooner!'
What are the challenges of pursuing a swap deal?
In certain respects, the deal takes on added complexity since valuing billboard assets is more subjective than valuing cash. The complexity quotient also increases to the extent that a transaction involves a combination of cash and assets. Beyond that, finding someone who wants to trade assets with you is often challenging. That being said, certain deal components can be simplified in a swap transaction. For example, in cash-for-assets transactions, one of the main negotiating sticking points between buyers and sellers are representations and warranties. When parties are swapping like-kind assets, however, these provisions tend to be reciprocal so there is less tension between the counterparties. There becomes an "if it's good enough for you, it should be good enough for me" mentality on both sides.