SBA Communications Corporation (SBAC) Earnings Call Transcript & Summary

Well, thanks, and good afternoon, and welcome back to Citi's Global TMT West conference. For those of you I haven't met in person, I'm Mike Rollins, and I cover the communications services and infrastructure categories for Citi Research. Just for reference, we have disclosures available on the conference registration site. I'd like to welcome back to the conference, Brendan Cavanagh, Chief Financial Officer of SBA Communications. Brendan, Happy New Year, and thank you for joining us today.

Yes, absolutely. Happy New Year, Mike. It's a pleasure to be here. Even though I'm still where I am. It's a pleasure to see you.

It's great to see you. We -- I missed, and I think a number of people missed doing this in person, but it's great to have the opportunity to do this and spend time with you today.

And just to catch up with SBA's opportunities that are in front of the company. So maybe we'll start there. And if you could share the strategic and operating priorities for SBA as you're looking at 2021.

Yes. Sure. I mean, actually, my answer is probably very similar to what it's been in prior years. We continue to focus on, obviously, superior execution throughout the organization in all areas. We have a particular focus always on high-quality portfolio growth, ideally focused on kind of hitting that 5% to 10% portfolio growth target that we've talked about for many years. Now we've added in over the last few years, continuing to explore new initiatives, which is something that we've got on our list for this year. And we're always looking to kind of optimize our balance sheet further. We had a good year last year in that regard, and that will be a focus again this year.

Great. Well, we'll try to unpack each of those things. Before we get there, maybe just taking a step back, we just find SBA as a company, do you think of yourself as a global tower company and just pursuing some adjacencies? Or do you think of yourself as a global communications infrastructure provider, and it's just inevitable that you're going to have significant exposure into other product categories beyond just providing tower colocation.

Yes. I think it's probably more of the former. We're first and foremost a tower company. However, having said that, there are certainly a number of potential adjacent opportunities that might benefit our tower business or that may benefit from our tower business. So we've certainly been looking at those. We have an interest in pursuing some of those areas. I think some of them will be worth looking at further and pursuing further and others will turn out to not be. So I think when we think about it, we say we're primarily a tower company, but there are other things that can supplement what we do as a premier tower company. And if we can reach returns for our shareholders through those efforts, that's something we're going to do. From a geographic standpoint, as you mentioned, we'll, I think, continue to evaluate opportunities around the globe. But we don't feel any compulsion to just get bigger for the sake of getting bigger. The opportunity for us is to try and drive shareholder returns using the assets and the resources and the skills that we already have at our disposal. So that's what we'll be focused on.

Well, that's really helpful. And I want to bring in our audience with our first live survey question ahead of delving further into the domestic business. So let's pull up survey question #1, it's become a tradition to ask our audience what they think of domestic organic revenue growth will be for SBA in the following year? So this is for 2021. And we're going to make it a little easier on our audience. We're going to say, excluding T-Mobile churn. So what's the domestic organic revenue growth for SBA, and that could be at or below 3%, 3% to 5%, 5% to 7%, 7% to 9%, and it's probably going to read 9% on the survey, but it should be over 9% is the last choice. And we'll see what our audience says, we're going to come back to that, Brendan, in a moment. But before we get there, maybe let's just take a moment. And if you could just unpack the impact that the pandemic is having on the domestic and the international operations and what the investors should be mindful of in terms of how that's influencing SBA's performance, both recently and over the next 12 to 24 months?

Yes. I think, if you think about it, there's sort of 2 pieces to it for us being an international company. From a domestic standpoint, I don't really see much of a material impact certainly on our ability to execute on leasing demand or do any of the primary things that we do. Even our frontline workers have been out there since the beginning of the pandemic, and they continue to work very hard to support our customers' network needs. So I expect that, that will continue pretty much business as usual. There are always little things, but generally speaking, limited impact there. The bigger question is whether the lingering effects of the pandemic continue to slow network investment from our international customers. They've indicated that they expect to kind of get back to network investments soon, but there's certainly a risk of further delay as the financial impacts and just some of the general operational day-to-day impacts in those markets perhaps are a little bit bigger than they are here.

And if we can reveal the results of the first survey. Now, by way of background, I think the midpoint of guidance is in the low 4% range for 2020. So the indications from our audience, 50% at 5% to 7%, 44% at 3% to 5%, 6% at or below 3 and then 0 for the other choices that were 7% to 9% or over 9%. What are -- Brendan, as you look at the year to come, how do you think about the pluses and minuses for organic growth for the domestic business? And how -- and do you have any kind of thoughts after seeing what the -- what our audience thinks?

Yes. I think 1 thing that maybe requires a little bit of clarification that is not necessarily reflected there, but just for the sake of being on the same page as we talk about this, is that for us, reported organic revenue growth is based on a trailing 12-months basis. And so it kind of lags our operational new lease and amendment signings by several quarters typically. So as I look at it, and I think I already know what 2020 has looked like in terms of signings during the year, and they've been slower. I think we've talked about that a number of times over the last 6 months or so, that the signings in 2020 were a little bit slower. And so as a result, I would expect that our reported growth numbers will be a little down during '21, and specifically in the first part of the year because that will be what's most impacted by what I know, which is 2020's activity levels. However, we are beginning to see increases in operational lease-up, and there's a number of catalysts expected ahead that should drive increasing gross growth numbers for the next couple of years. So I think the opportunity to see the trajectory of those numbers shift as we start to move through '21 and get to the latter part of the year and exit the year, I think they will be certainly on an upward swing based on our expectations and even what we're seeing today.

We're going to throw out the second -- it will be the fourth survey question on the list, or second one on the session. But for #4, will the locations of SBA's domestic tower portfolio influence the market share of site leasing activity, colo and amendments for the next 1 to 3 years. And the question comes up because of I think some of the recent deals that were signed by AMT with T-MO, Crown with DISH. And as we wait for the answers, which are choice, a, yes, urban and suburban is more valuable than rural. Yes, rural will become more valuable for the ongoing coverage and densification needs. Or no, tower companies are likely to keep their average share positions. We'll come back to this question in a moment. We'll just see what the audience thinks first, Brendan. And then we'd really like to see what you think about this subject. But before we get there, and while they poll in, and just for our audience's sake, every response is anonymous, we won't know who you are. What's your thoughts on the pacing of churn from Sprint and T-Mobile? How will that churn work through your model over the next 3 to 5 years?

Well, when you look at our exposure to Sprint and T-Mobile, we've got about 6% of our leasing revenue that's coming from Sprint on sites where they overlap with T-Mobile. The average remaining noncancelable term on those leases is about -- now about 3.7 years. So based on our analysis and the term lengths that we have, we'll likely see some impact, maybe 1/3 of it, over the next 3 years or so. But most of the churn impact will likely be 5 to 6 years from now. Now having said all that, so much of it could change based on T-Mobile's network plans over that time period. I mean, they may choose to do certain things that would adjust that. We also have the possibility that DISH may decide to step in and use many of those Sprint leases as well. So depending on what happens there, that could obviously shift, but just purely based on what our exposure is and what the term lengths are that are -- underline those leases, that's about the time sequence we would expect.

So should churn -- well, actually, we'll go the survey in a moment. But should churn be down in '21 now as you've gotten through some of that peak or that trailing, I should say, hide-in churn and some of the other stuff that you flagged earlier in 2020?

No. I mean, the iDEN stuff was really pretty much gone for 2020. So the impact of that shouldn't really be all that relevant. I think the question of whether there's some incremental sprint churn. And there is, I think we talked about maybe on our last call that we did receive some amount of notices. There's maybe $4-ish million worth of annual churn that we did get notices on from T-Mobile related to Sprint leases. So that will be an incremental impact. There will be some other things that may be a little bit less, though, than we had for last year. The Metro/Leap Clearwire stuff has kind of started to wind off and pretty much be done at this point. So those things maybe offset each other. So probably in a similar range to what we had last year.

Okay. And I think we have the survey results now ready to be revealed. So we have 85% yes, urban/suburban are more valuable contributors in rural. 15%, no, likely to keep average share. So Brendan, as you look at where your towers are located, can you frame for us what kind of exposure you have and whether you think the locations of your towers are going to make a difference in the share that you can go after of new colocation and amendments as you think about DISH, as you think about C-band?

Yes. That's an interesting result from the survey there because we've obviously, been doing this for a very, very long time and have the history of kind of watching our own portfolio and where the lease-up comes. And it's really been pretty -- historically, it's been pretty well spread out across the portfolio. You would be surprised at how little a difference some of those indicators actually have -- bear out on lease-up. But my belief is that, and our history has shown that there may be some variations in timing on a tower-by-tower basis. But ultimately, the broader coverage needs will be what drives activity across many sites at really, frankly, all of the tower companies. I don't think there will be a significant impact really based on the location. But if there is, it's probably just minor timing differences. And I think just for clarification because I think what's underlying this is this presumption that we're somehow this rural tower portfolio. 60% of our towers are located in the top 100 BTAs. So I don't -- I think when you compare that against the other tower companies, I don't think the makeup of our tower portfolio is materially different from our peers in terms of location. And if you looked at our history in terms of lease-up and growth in every single wave of technology rollout, I wouldn't expect this to be any different than it's been in any other previous generation of that.

And to the announcements with AMT and T-Mobile and with Crown, DISH, do those impede your ability or hurt your ability to get your fair share even for that first 15,000 sites that DISH is targeting by mid-'23?

I don't think so at all. I mean, we would certainly expect to get our fair share. Again, each of those carriers have nationwide build-out needs that will require infrastructure from all the public tower companies. Today, we're currently very busy with T-Mobile right now, and we're having very productive discussions with DISH about their future plans. So I really have no concerns that we're disadvantaged in any way due to the agreements that they signed with our peers.

A question that we've gotten from the buy side on the domestic growth is with the prospects of improving that gross revenue gain in the second half of '21, is that dependent on new activity rolling through from C-band? Or is it -- is that view just simply based on what you're seeing in the now from T-Mobile and from the activity of your other customers?

I'd say it's probably a mix of both of those things. There certainly is more activity now with T-Mobile, for example. Obviously, they were slow for a period of time after the merger there, I think, as they kind of got their plan in order, we're starting to see that shift. And so that certainly gives us confidence that there rollout of the 2.5 spectrum as well as the 600 will continue to drive greater activity from them. They have a lot to do. But also, the C-band, I think, will be a significant driver. We'll see how it all shakes out when it's said and done here, but it should be a significant driver of that kind of mid-band 5G rollout for both Verizon and AT&T. And I think that will be a driver of increased leasing activity in the latter part of this year as well. So it's really a mix of both of those things. And of course, DISH, which hasn't been doing anything recently because they've obviously also been getting their strategy together and working with each of the different providers that support them and what they do, including the tower companies, I think that we may start to see some activity from them at some point towards the latter part of the year, although we haven't contemplated too much impact to '21.

Okay. And in terms of just some of these other adjacencies that you've talked about in the domestic business, where do you see the edge data center concept fitting into all of this?

Well, I think the introduction of 5G stand-alone architecture in general, along with OpenRAN, it's created sort of this need to deploy more IT infrastructure at the edge. So when you think about that in addition to the fact that edge computing will, I think, aim to densify locations where compute happens as a way to kind of lower the latency between the cell phone and the cloud service. That, along with just this natural location to kind of cash content for video traffic, that sort of thing. All of those things would suggest that tower sites, which are at the ultimate edge of the network are ideal locations for data centers, I think, in a 5G world. And so that makes us believe that it's worth the effort to pursue whether or not that's something that we might be able to participate in. We basically want to be prepared to do that if, in fact, that becomes a reality. I will say that it's still somewhat early in the whole process. The carrier architectures are obviously still being developed and refined. And so we probably have several years still of this evolution. But again, we want to be prepared so that we can participate in a big way if and when that edge data center is ultimately positioned at the tower sites, which we think there is certainly a good likelihood of that occurring.

And is partnering critical to the success of that in terms of partnering with the data center firm or multiple firms partnering with cloud firms? Is this something that you feel like alliances and partnerships can take you further down this road? Or do you ever see a world in which your assets are merged with a larger-sized data center firm? I know you have a couple of small investments in data centers now.

Yes. I mean, well, our small -- our investments in data centers, just for clarity sake, on that, are really being done only as a support of our overall mobile edge strategy. We're not specifically looking to get in the data center business, we're looking at learning from those investments so that we are better operators of data centers that we ultimately would expect to be located at the towers. So I don't think -- while there certainly can be value from partnerships with certain folks who might bring different aspects to the mix of what our customers might want or require at the location. It will be somewhat dependent upon how -- what our role is in it. Are we simply just a landlord? And frankly, if we're just a landlord, I don't know how much of a partnership structure we need because we have the most important part in that, which is the real estate and the location. And so we can provide that without it. If we look to get a little bit more involved in the actual active network and depending on the level of involvement there, bringing in other folks possibly could be a way to approach that. But we have got pretty good relationships today with a lot of different companies out there. We're in discussions with a lot of folks about how things might work. But again, as I said earlier, it's still kind of early in this process, and we're not jumping ahead to kind of marry ourselves to structure that may not be the actual best long-term solution.

I want to bring in another survey question, survey question #2, we're going to get to the international business in a few minutes. And one question I think we've asked this before, is investors contemplate and ask about your international operations. We're asked, should SBA be pursuing new investments in the international market. So your choices, for our audiences: yes, pursue new build-to-suits as well as M&A; no, focus on just increasing colocation on the existing international assets that you have; or no, just sell the international assets. And we'll see what our audience thinks, and we'll talk about the international business in a moment. Just staying on domestic while everyone polls in, is there a significance to the amount of money that the wireless carriers are bidding in terms of the C-band auction value that it's reached? And does this higher dollar amount mean that these carriers could actually deploy more quickly the C-band? Or did the dollars being invested, whether it's lower or higher, not change the timing of their investments on that spectrum?

Yes. Well, obviously, we don't yet know who the winners are and then to what degree. But presuming that the primary winners are the 2 larger incumbent carriers. I think that the amount of money that's being paid is it supports the idea that this mid-band spectrum for mid-band 5G deployment is critical to their future. They see it as critical to their network futures. And so the only way to really realize value from those investments is to actually deploy the spectrum. Right now, T-Mobile is actively deploying 2.5 gigahertz 5G network today. And so as a result, I would expect Verizon and AT&T to start doing the same as soon as possible, perhaps in the first half of this year. I think the main consideration for us in terms of the timing will be more about how quickly the spectrum clears, how much advance time do they need in terms of investing in their network. Those will be the things that probably have a greater impact on it than whether they have a desire or wherewithal to invest, I think they're demonstrating that they have a strong desire just through what's happening right now with the auction.

You raised a really interesting point on the subject of clearing. So the way the -- I guess, the auction rules are written is there's an A block of spectrum that is supposed to clear by the end of this year. And it's a certain amount of spectrum in 46 of the top 50 markets, I believe it is, in the country. And then the rest of it is supposed to clear -- or at least the deadline is end of '23, I believe, for that. And so the question is, can that spectrum that's supposed to clear by the end of '23 actually clear a lot sooner and facilitate ongoing deployments? Or is there a risk that the deployment is really principally for whoever has the A block over the next year or 2, and then it takes time to get to the rest of it. Do you have a sense of how this is going to play out?

Yes. I mean, this is obviously just my thoughts on it. The carriers can answer all that a lot better as they're the ones who will be rolling out those networks. But so let's first start with the first A block there. As you mentioned, spectrum in 46 of the top 50 markets is expected to become available by December of this year is the time frame for that. And then the operators will only be able to activate their sites once they have the spectrum. But they will begin, I think, likely deploying that equipment prior to that time, so they can turn on the sites as soon as the spectrum is available. If you think about T-Mobile and the 600, that was basically the case for their initial 600 megahertz deployments. They started rolling stuff out, putting equipment out so that once it cleared and was available, they could immediately turn it on. It's also possible just as a side note that spectrum may be cleared faster, and this applies to all the blocks, but maybe clear faster, what we talked about the dates you mentioned, that's really kind of the outside deadlines, that's not necessarily when it will happen. It could happen earlier. And in fact, it did happen earlier again with the 600 megahertz spectrum. So that could certainly accelerate things a bit as well. So as to just the general timing when you think about the other blocks, the way I look at it is that operators have historically focused new technology deployments, in general, on the top 50 markets initially, and then they have extended to other markets over time. And so I think we'll likely see rollouts for the top 50 markets for the C-band in the next 18 to 24 months. And then you'll see deployments in the other markets subsequent to that. That wouldn't be that different than what's happened in previous rollouts. So if you take that and you think about the satellite companies have said in terms of the details they released about their transition plans that they expect to be deploying new satellites in 2022 and 2023, which means if it took that long that the additional spectrum beyond municipal 100 megahertz would likely not be available for use by the carriers until 2023. But again, work would probably be done ahead of that time frame in terms of rolling out equipment by the carriers in order to be able to turn that spectrum on as soon as possible when it was available. So I think you'll see just a normal natural roll out the way that we have with other bands in the past. And yes, the A block will happen first, of course, but you'll have what amounts to a multiyear rollout, which I think is ultimately very good for us for a sustained period of growth.

And just bringing this full circle to some of the comments that you made earlier about your market exposure, if the focus is initially the top 50 markets in terms of deployments, do you feel good about getting your fair share of that based on where your towers are located in those top 50 markets?

Yes, for sure. I mean, again, I mentioned 60% of our towers are located in the top 100 BTAs. I think it's 40% or so are in the top 50. And there will be work done nationally anyway during those time periods. So I don't feel disadvantaged in the least. And ultimately, most of that deployment will be done in the form of amendments that are upgrades to the existing sites. And we have what we have already with our customers, and they simply don't get passed by because somebody else has an MLA or some other thing. I think the locations have already spoken for themselves and that they're already located at those sites.

And just lastly, you mentioned about the upgrades that happened before even the spectrum clears, could this be a super cycle of upgrades, where some of the carriers might also take the opportunity, not just to deploy C-band but go back and upgrade antennas to 4x4 MIMO or put some other capabilities on the platform. So there's actually a larger upgrade opportunity beyond just the specifics of C-band. Is that something we should be thinking about? Or has the MIMO upgrades already largely played out for the carriers?

Yes. No, I think it definitely is a possibility. I mean we have been seeing MIMO upgrades already. So I would expect, though, that, that will continue to be based on where they seem to be in that cycle. I mean, you're talking about several years, probably still for that. But the carriers are constantly -- even when there are waves of rollouts such as C-band and we focus in on C-band. That can often be a catalyst to drive activity of a particular project at tower sites. But in the past, when we've seen similar types of rollouts, there are always other things that need to be done that get done. There's always upgrades. There's always equipment that needs to be improved or fixed, even if it's not technically a new technology deployment. So all of those things tend to get driven by an initiative that then drags along other activity. And I would expect that this will be very similar in this particular case.

So moving to the international business for a few minutes. If we could pull up the results of the survey. So the question was, should SBA pursue new investments in international markets and 92%, yes, build-to-suit and M&A. And 8% said no, just focus on the existing. And 0 for selling the international assets. So as you look at the international portfolio, what gets you excited about the investment opportunities? And are the regions starting to change about where you're excited to deploy those incremental dollars?

Yes. I mean we have obviously been predominantly a U.S. tower focused -- or U.S. market-focused tower company. And I think that will remain the case for us because there are certain attributes about the U.S. that I think make it the best tower market out there. However, having said that, from a general standpoint, organic growth internationally should really be better than the U.S. It has been better than the U.S. historically because those markets are less mature. The wireless networks are less mature. The sites are less mature. And so the opportunity to see increased growth is greater in those places. And again, on a historic basis, our -- at least on a constant currency basis, anyway, our organic growth internationally has certainly outpaced our domestic growth for a number of years now. So I think that there are a number of places where when you can find the right market, where you either arrive early enough ahead of others, you have an existing relationship with the key customers in the market or the dynamics of that market itself, such as, for instance, when we went to Costa Rica, the wireless market was being deregulated. And so there was an opportunity to kind of be there on the ground up as new carriers came in and built out their wireless networks, and so that gave us an opportunity to see significant growth. And so when we look back at our most successful markets, they've largely been in places where we got in ahead of others. We were, I think, focused on the right kinds of assets. Central America has been a tremendous success for us. South Africa, even, which we haven't been in that long has I guess, really probably been stronger in many ways because of how short the time period is that we've been able to create just about double-digit cash-on-cash returns in that market. So we've done that largely through getting there ahead of time, using relationships that we had in those particular markets. And I think being disciplined in the decisions we've made in terms of which assets we've had. So I'm excited about the possibility of continuing to do that. It's not easy. There's certainly a lot of competition out there, and there's a lot of people around the globe. And so to find those opportunities where you can kind of jump in ahead of others, it's not always the easiest thing. But I think we are pretty good when it comes to integrating towers, when it comes to maximizing the value of towers. I think we've demonstrated that over the years. And so we're excited about the opportunity to continue to find those pockets where we can do that and create value for the shareholders.

Do each of these markets have to hit a certain level of what I would describe as a minimum efficient scale to feel really good about the returns. And if the answer is yes, are there markets then that may be below that threshold currently that have to kind of work their way up or work their way out?

Yes. I mean, although it's -- yes. The answer is yes, but it's not that much. I mean, ideally, we need a certain amount of scale to support the cost of the local office and the overhead there. But we can generally achieve that scale with a few hundred sites in a given market. We do have a couple of markets where we're really not at that ideal level in a couple of our South American markets. And so our goal is to obviously try to get there soon. And I think to your point, maybe at some point, if we determine that, that just can't be done, it may not be worth continuing in that particular market. But we'll see. It's not it's not our desire to exit a market once we get in there. It's our desire to make that work and to be successful, but we're also not so tied to it that we're going to just let it languish for a long time either. So that's a possibility. But generally speaking, because of the fact that they have limited assets, their impact in terms of the materiality on our overall numbers is very, very small.

What's been the feedback on the dividend policy that SBA has evolved into? And do you foresee any acceleration or deceleration in the payouts?

Well, our -- first of all, on the policy as a whole, I mean, I think our investors have been pleased with our approach so far. As long as we can deploy capital into quality investments and drive superior returns for them, I think, a lower but rapidly growing dividend seems to hit the sweet spot in terms of what they like. And so to your question of whether there's a deceleration or an acceleration, we've only been paying a dividend now for about 6 quarters, I believe. We raised it once at the beginning of last year. We expect to raise it during this first quarter of this year. Again, that's the plan, I don't see why that would change all. And I think we'll continue to probably be the fastest-growing dividend, certainly in our space and among most companies that are out there. And I think that, that suits us well for a variety of reasons, one of which I think worth mentioning, at least from my perspective worth mentioning, is that it allows us to maximize the value of our NOLs. Our approach to dividends does that. And if we didn't, the loss of those NOLs to me would be, frankly, the destruction of a valuable asset. And I don't think that makes a lot of sense. So feedback we've gotten has been pretty positive, and I don't expect our approach to the dividend to change too much. I can't hear you.

Can you provide an update -- can you hear me now?

Yes. Sorry.

Can you provide an update on how the management team and the Board thinks about share repurchases? Is it -- is there a sensitivity to the price at which you buy the shares? Or is it more about sweeping excess financial flexibility that you may have in a given period and just applying that to share repurchase to manage the per share growth of whether it's the FFO or AFFO per share?

Yes. I mean, it starts with -- and this -- you've probably heard this answer before over the years, too, because it really hasn't changed too much in terms of our approach. But it starts with our comfort with a certain amount of leverage. And we've had a very similar target now for the last 10-plus years in terms of where we're comfortable operating from a leverage standpoint. And given the amount of cash flow that we generate every year and the growth in our EBITDA, we're constantly expanding the amount of capital that we have available to invest in the business. And while our preference would be to focus on investing in the portfolio, the environment is very competitive today and we're not going to just buy any asset just for the sake of getting bigger, we're going to focus on the ones that we think are value additive. But the benefit that we have is that we do have the secondary use of capital, which is the share repurchases. And so our plan is to basically optimize our balance sheet and the way that we do that is we supplement our portfolio growth as well as the dividend, of course, with share buybacks. Now our approach to how we attack those share buybacks has typically been to be opportunistic. And try to take advantage of price volatility when we see it. And oftentimes, that volatility isn't based on something that's necessarily SBA specific. And so it does give us opportunities to jump in and buy when we see the stock trade-off. And so we have taken an opportunistic approach in the past and maybe bought a little bit more at those times. But that's not really the primary driver. The primary driver is optimization of the balance sheet and using that capital when the opportunity presents itself.

And just in terms of leverage, which you mentioned, is there a point where the net debt leverage needs to come meaningfully down from the near 7x that it is currently? Or is that 7x, do you think sustainable for a number of years in the way investors think about the flexibility for you to invest in any given year?

Yes. I think it is sustainable certainly for the next several years. Some of what drives it is obviously a function of what the investment opportunities are. And for us, there may be large -- like a larger investment opportunity into a particular portfolio of assets may temporarily cause it to go up. And then we would have the ability to fairly quickly delever back into our comfort range. Sometimes it drops below that, and it gives us the opportunity to be more aggressive later on. So it's not so precise that we're looking to nail a specific number every single quarter because, obviously, opportunities ebb and flow a little bit. But in terms of our desire, it is to maintain that level of leverage and invest that capital into quality assets and/or buybacks when we see that opportunity. And I don't expect that to necessarily change over the next few years. If we saw some -- I guess, if we saw some meaningful dislocation in interest rates or something where they started to spike rapidly or something else unforeseen happened, we might change our approach to that a little bit. But right now, our dividend, which was 1 of the things that was out there that we used to talk about is a reason that we might start to moderate our leverage a little bit is really, frankly, fairly small as a percentage of our AFFO. It's around 20% of our existing AFFO that we're generating. So it's not material enough to create any sort of situation where we feel like we need to delever in the short term. So that's a long answer, but the short answer is basically, we're comfortable around the same leverage range that we've been in for probably the next few years depending on the opportunity set that's available to us.

Has there been any change in the ability for you to manage the ground lease portfolio, whether it's in the context of being able to extend leases at reasonable terms or buy the land in when there's opportunities to do that?

No. I mean, we've been doing it now for a decade, and we have a dedicated team that's just focused on that. We've had pretty good success with it. I think the only challenge to it really, especially if you look at the domestic portfolio is, frankly, that we're not adding that many new assets here domestically. And so the opportunity set for our folks to contact to be able to do those buyouts is getting smaller as we have more success. We're not necessarily replenishing the number that we're taking out. And so that's probably the biggest challenge is just that it's a little bit stale. You can only call the same landowner so many times before they don't want to hear from you anymore on the subject. But I think we've done a good job there. And we started to turn our attention a little bit more on that front to our international markets and doing the same sort of thing. And I think we've seen the opportunity to not only protect our assets through it, but also to create value through very accretive buyouts. And so we'll continue to do that. But from a risk standpoint, I don't think we have any real concerns at all anymore.

And just maybe to put some numbers on that. What percent of the domestic property under the towers do you own versus international?

Well, we haven't given that number before in the past. It's certainly higher -- I believe that it's higher domestically, although we did buy 1 or 2 portfolios that had a large percentage of owned property in Brazil. So I could be off on that. But for our overall portfolio, we control over 70% of our properties for at least 20 years because some of the buyouts that we do, sometimes folks don't want to necessarily give up ownership of their towers -- of their land, excuse me, but they they're very comfortable giving you a long-term extension to the agreement. So sometimes it's done in that form as well. And so we have a large percentage of our portfolio that is -- the vast majority is covered. And even the ones that are leased, the average lease terms today, I believe, are about 33 years under our control. So it's really not been a risk area. And I can't remember us, frankly, ever losing a site as a result of a ground lease issue.

Well, in our final minute, is there any other thoughts that you want to leave our audience with as they think about SBA moving forward into 2021?

Yes. I think it's -- we're excited about the opportunities that lie ahead of us. We talked about some of those today in terms of what our customers are doing. There's a lot of growth, I think, that's coming in terms of the T-Mobile build-outs, DISH is a brand-new tenant across -- building out a brand-new network, the C-band. All of these things, I think, give us great excitement about the growth prospects going forward. And I think people will be pleased to see the trajectory of this industry and of SBA, in particular, over the coming years. So I appreciate the time with you, Mike, and thanks for the questions. And hopefully, we'll see each other in person next year.

I hope so. And thank you for sharing your time with us today. Thanks, Brendan.

No problem. Thank you.

Thanks.