IHS Holding Limited (IHS): Business Model Canvas [Dec-2025 Updated]

You're looking to truly understand the engine room of one of the largest independent tower companies, and for IHS Holding Limited, that means dissecting a model reliant on long-term contracts with Mobile Network Operators (MNOs) across emerging markets. Honestly, the core story here is infrastructure-as-a-service: they manage nearly 39,184 towers, aiming for $1.72 billion to $1.75 billion in revenue for 2025 by selling reliable uptime and colocation efficiency, evidenced by their 1.52x tenancy ratio. Still, that stability comes with the constant pressure of managing power costs and securing capital, like the recent $300 million RCF, so if you want to see the precise levers driving their $400 million to $420 million Adjusted Levered Free Cash Flow guidance, check out the full Business Model Canvas breakdown below.

IHS Holding Limited (IHS) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that keep IHS Holding Limited (IHS) operating and growing across emerging markets. These partnerships are the bedrock for their tower and infrastructure business, especially as 5G rolls out.

The most critical partnerships are with the Mobile Network Operators (MNOs) who become the anchor tenants on the towers. These are long-term Master Lease Agreements (MLAs) that provide IHS Holding Limited with highly predictable, contracted revenue streams. For instance, the relationship with MTN Group is foundational; MTN remains IHS Holding Limited's largest customer and longest-standing partner, holding a 26% equity stake in IHS Holding Limited. As of late 2025, the renewed Nigerian tower MLAs with MTN Group secure tenancy across approximately 26,000 MTN tenancies across six African markets until December 2032. Also notable is the MLA renewal with Airtel Zambia, which covers about 1,100 tenancies extending until August 2035.

Here's a snapshot of the key MNO relationships driving tenancy volume:

The strategic agreement with TIM S.A. in Brazil is a major recent development. This build-to-suit (BTS) partnership aims to construct up to 3,000 new sites across multiple regions in Brazil, with an initial minimum deployment commitment of 500 sites. This directly supports the 5G rollout and reinforces IHS Holding Limited's confidence in its positioning to capture rising digital infrastructure demand.

IHS Holding Limited also relies heavily on external parties for the physical build and operation of its infrastructure assets. These include:

• Equipment vendors for network technology supply and ongoing maintenance contracts.
• Local power and energy suppliers across African and Latin American markets to manage site power needs, including the deployment of efficient power technologies like solar systems.

Finally, access to capital markets through financial institutions is crucial for funding growth and managing the balance sheet. This involves securing debt refinancing and maintaining liquidity. A key facility mentioned is the Group Revolving Credit Facility (RCF), which as of the March 2025 reports, had an undrawn commitment of $300 million with a maturity date set for October 2026. This availability supports ongoing operational flexibility.

IHS Holding Limited (IHS) - Canvas Business Model: Key Activities

You're looking at the core engine of IHS Holding Limited (IHS Towers), the day-to-day work that actually brings in the cash. This isn't just about owning metal poles; it's about the complex execution required to keep mobile networks running across emerging markets. The key activities are centered on infrastructure development, long-term contract securing, and portfolio refinement.

The most fundamental activity is developing and operating shared communications infrastructure. This means building, maintaining, and managing the physical assets-the towers-that host antennas for multiple mobile network operators (MNOs). By the end of the third quarter of 2025, IHS Holding Limited reported having a total of 57,691 Tenants across its portfolio. This activity is supported by strong commercial execution, evidenced by the fact that Lease Amendments reached 42,221 by that same period, showing continuous demand for adding more capacity to existing sites.

Next up is managing complex power solutions for off-grid tower sites. In many of the operating environments, grid power is unreliable, so keeping the lights on-and the network running-is a massive operational task. This involves managing diesel generators, batteries, and increasingly, renewable energy sources to ensure high uptime for their MNO customers. This focus on operational excellence is reflected in the financial performance; for instance, the Adjusted EBITDA Margin hit 63.3% in the third quarter of 2025.

Securing the revenue base requires diligently securing and executing long-term Master Lease Agreements (MLAs). These are the bedrock contracts that provide revenue visibility. The agreements lock in MNOs for years, often with built-in escalation clauses like foreign exchange resets and power indexation, which helped drive organic revenue growth of 6.6% in Q3 2025. You want these MLAs to be long-dated; for example, a renewed MLA with Airtel Zambia covers tenancies until August 2035.

A critical, ongoing activity is strategic asset portfolio management, including disposals. This is about pruning the portfolio to focus capital where growth is highest. A clear example of this in 2025 was the finalization of the sale of its Rwandan operations to Paradigm Tower Ventures in October 2025 for a total enterprise value of $274.5 million. This divestment was part of a broader strategy to optimize the portfolio and enhance shareholder value.

Finally, IHS Holding Limited is actively engaged in building new towers (BTS) to capture greenfield growth. The company is targeting significant build activity. Specifically, as of the second quarter of 2025, the plan included building approximately 500 build-to-suit sites for the full year 2025, with about 400 of those slated for Brazil. Furthermore, a new site agreement signed in October 2025 with TIM S.A. in Brazil aims for an initial minimum deployment of 500 sites as part of a larger potential build of up to 3,000 sites.

Here's a quick look at some key operational metrics from the third quarter of 2025:

The execution of these activities directly impacts the financial results. For instance, the combination of organic growth and FX resets drove Q3 2025 revenue up 8.3% year-on-year. The focus on operational discipline and contract escalators is what allows them to generate strong cash flow, with Cash from Operations reaching $259.6 million in that same quarter. The key is translating site growth and contract execution into margin expansion, which they achieved with an Adjusted EBITDA Margin of 63.3% in Q3 2025.

You can see the direct outputs of these activities:

• Securing long-term revenue through MLAs.
• Adding new capacity via Lease Amendments.
• Expanding footprint with New Sites builds.
• Optimizing capital by divesting non-core assets like Rwanda.
• Maintaining high service levels via power management.

Finance: draft 13-week cash view by Friday.

IHS Holding Limited (IHS) - Canvas Business Model: Key Resources

You're looking at the core assets that power IHS Holding Limited's business as of late 2025. These aren't just line items on a balance sheet; they are the physical and contractual foundations supporting their operations across emerging markets.

The physical infrastructure is extensive. IHS Holding Limited operates an extensive tower portfolio of approximately 39,025 towers across emerging markets as of the end of the third quarter of 2025. This figure reflects organic growth, though it was impacted by the strategic disposal of its 100% stake in IHS Rwanda, which included about 1,467 towers, completed in October 2025. This move was part of streamlining the footprint toward higher-return assets.

The company's stability is heavily reliant on long-term, non-cancellable lease contracts with Mobile Network Operators (MNOs). A major anchor is the renewal and extension of all Nigerian tower Master Lease Agreements (MLAs) with MTN Nigeria until December 2032. This single agreement covers approximately 13,500 tenancy contracts. As of December 31, 2024, the average remaining length of all MLAs was 7.0 years. To be fair, these contracts are structured to provide revenue visibility, which is crucial in volatile markets.

The commercial relationship strength is also visible in the volume of ongoing contract adjustments. At the end of the third quarter of 2025, total Lease Amendments stood at 42,221.

The contractual terms themselves are a key resource, designed to manage local economic risks. You can see the structure in the latest major agreement:

The operational backbone is supported by specialized local operational and engineering talent. This team manages the day-to-day upkeep and augmentation of the physical assets, which is non-trivial given the operating environments.

Intellectual property related to power management and site security is another vital, though less quantifiable, resource. This know-how helps maintain high uptime and manage operational costs, especially concerning power generation.

Financially, IHS Holding Limited maintained a strong liquidity position. At the end of Q3 2025, liquidity was reported at over $950 million, excluding the cash proceeds received from the Rwanda disposal, which would push the total well over $1 billion. This strong cash position supports ongoing operations and strategic flexibility. The company generated an Adjusted Levered Free Cash Flow (ALFCF) of $157.8 million in the third quarter of 2025, an 81.2% increase year-on-year.

Here's a quick look at the operational scale as of September 30, 2025:

• Towers operated: 39,025
• Total Tenants: 57,691
• Colocation Rate: 1.48x
• Total Lease Amendments: 42,221
• Q3 2025 Revenue: $455.1 million
• Q3 2025 Adjusted EBITDA: $261.5 million

Also, consider the contractual terms for different site types:

• Master Lease Agreements (MLAs) initial term: Typically 5 to 10 years.
• Managed with License to Lease (MLL) Agreements term: Typically 15 years.
• MLL renewal period: Typically a five-year period.

Finance: draft 13-week cash view by Friday.

IHS Holding Limited (IHS) - Canvas Business Model: Value Propositions

You're looking at how IHS Holding Limited makes its offering compelling to Mobile Network Operators (MNOs) in late 2025. The value is in de-risking their operations and accelerating their network build-out without the massive upfront capital outlay.

Enabling MNOs to reduce capital expenditure via colocation

By using IHS Holding Limited's existing infrastructure, MNOs avoid building their own towers, which directly translates to lower capital expenditure (Capex). This strategy is evident in IHS Holding Limited's own capital allocation focus. For instance, Total Capex for the third quarter of 2025 was reported at $77.3 million, an increase of 16.3% year-on-year, reflecting phasing of maintenance and augmentation spend. This contrasts with the lower spend seen earlier in the year, such as the $43.6 million Total Capex in the first quarter of 2025. The MNOs benefit from this shared model, allowing them to deploy their capital to core network elements like spectrum and active equipment instead of passive infrastructure.

Providing reliable network uptime in challenging, off-grid environments

A core value is ensuring service continuity, especially where grid power is unreliable. IHS Holding Limited has actively managed power costs, which is a major operational expense in off-grid scenarios. Project Green, an initiative to enhance operational efficiency, was largely complete by the end of 2024. The expected power cost savings for 2025 were projected to be $77 million. Furthermore, the company has restructured agreements, such as introducing power indexation into MTN Nigeria contracts, to manage this exposure.

Offering rapid network expansion through build-to-suit programs

IHS Holding Limited helps MNOs expand quickly through its build-to-suit (BTS) programs. The company's 2025 guidance included approximately 500 BTS sites, with about 400 of those planned for Brazil. More recently, in October 2025, IHS Holding Limited signed a new site agreement with TIM S.A. in Brazil, aiming to build up to 3,000 sites, with an initial minimum deployment of 500 sites. This rapid deployment capability is a key enabler for MNO 5G rollouts.

Delivering high tenancy ratio (colocation rate of 1.52x) for efficient asset use

The efficiency of asset use is quantified by the tenancy ratio, which shows how many tenants share a single tower. As of the end of the first quarter of 2025, IHS Holding Limited reported a Colocation Rate of 1.52x. This metric demonstrates that, on average, each tower hosts more than one tenant, which drives operating leverage. To be fair, the latest reported figure for the third quarter of 2025 showed a Colocation Rate of 1.48x, with total Tenants at 57,691. The company continues to add tenants, with 961 net new tenants added year-on-year as of Q3 2025.

Here's a quick look at tenant metrics:

Shielding customers from local currency and power cost volatility

IHS Holding Limited actively manages currency risk, which is critical given its exposure to currencies like the Nigerian Naira (NGN). The company raised $1.2 billion through dual-tranche senior notes, using proceeds to extend debt maturities and convert more liabilities into local currency to reduce exposure. The stability of the Naira against the USD improved in Q3 2025, with a 3.7% appreciation versus the USD during the quarter. This contrasts with Q1 2025, where the Naira appreciated by 0.5%. The company's TTM revenue as of September 30, 2025, was $1.77B.

The mechanisms for managing volatility include:

• Implementing power indexation in key contracts.
• Extending debt maturities through refinancing activities.
• Achieving a consolidated net leverage ratio of 3.3x at the end of Q3 2025.
• Reporting a $157.8 million Adjusted Levered Free Cash Flow (ALFCF) in Q3 2025.

Finance: draft 13-week cash view by Friday.

IHS Holding Limited (IHS) - Canvas Business Model: Customer Relationships

You're looking at how IHS Holding Limited keeps its major Mobile Network Operator (MNO) customers locked in and growing their spend. It's all about long-term contracts and deep operational integration, which is how they managed a trailing twelve-month revenue of $1.77B as of September 30, 2025.

Dedicated account management for large MNO anchor tenants

IHS Holding Limited focuses its attention on its primary customers, the MNOs, who generate the bulk of its business. The relationship structure is designed to manage complex, multi-market agreements. For instance, in the third quarter of 2025, the total tenant count stood at 57,691. The relationship management is clearly tested by major events; for example, the company is managing the exit of its smallest Key Customer in Nigeria, 9mobile, which agreed to vacate sites starting in the third quarter of 2025 in exchange for a commitment to settle overdue balances through July 2027. This shows dedicated effort to manage difficult transitions while securing past dues.

Here's a snapshot of the relationship scale and recent activity:

• Total Tenants as of September 30, 2025: 57,691.
• Total Tenants as of March 31, 2025: 59,606.
• Airtel Zambia MLA renewed in May 2025, covering approximately 1,100 tenancies until August 2035.
• MTN Nigeria contract renewal in Q3 2024 led to an initial churn of approximately 1,050 sites vacated from January 1, 2025 onwards.

Long-term, contractual relationships (MLAs) with built-in escalators

The core of the relationship is the Master Lease Agreement (MLA), which is structured for durability and inflation protection. These agreements typically feature periodic reset mechanisms designed to help mitigate local currency devaluation, which is a real factor given the Naira's volatility-the average Naira rate in Q3 2025 was ₦1,523 to $1.00. For the year ended December 31, 2024, 47% of revenue came from contracts that included these protective clauses like escalators and foreign exchange resets. You'll also see growth driven by these contractual adjustments; for Q2 2025, organic revenue growth was partly due to the net benefit of foreign exchange resets and escalations.

The financial structure relies heavily on these long-term commitments:

It's defintely the escalators that keep the revenue stream predictable, even when local currencies move a lot.

Operational support and maintenance services (Managed Services)

Beyond just leasing space, IHS Holding Limited integrates deeply by providing operational support, essentially taking over the day-to-day running of the infrastructure. This includes power management, which is a significant component. For example, changes to power pass-through revenue agreements with MTN South Africa impacted revenue in Q1 2025, showing how intertwined the power Managed Services are with the top line. The company also helps customers with cost efficiencies by buying towers and leasing them back, taking responsibility for most maintenance and upgrades. The overall Q3 2025 Adjusted EBITDA margin was 57.5%, reflecting the operational leverage gained from managing these sites efficiently.

Strategic collaboration on network densification and 5G rollout

You see this collaboration reflected in the Lease Amendments category, which signals upgrades and capacity additions on existing sites. In Q1 2025, Lease Amendments increased by 477, primarily due to 3G and fiber upgrades. This shows MNOs are actively using IHS Holding Limited's existing footprint for their own network evolution, like densification efforts. Furthermore, the company is actively building new capacity, with guidance mentioning approximately 500 Build-to-suit sites planned for full year 2025. This collaboration is key to securing future revenue growth from tenants needing more capacity for data services.

IHS Holding Limited (IHS) - Canvas Business Model: Channels

You're looking at how IHS Holding Limited gets its value proposition-reliable tower infrastructure-into the hands of its customers, the Mobile Network Operators (MNOs). It's a mix of direct, high-touch sales and long-term contractual commitments that lock in revenue.

Direct sales and business development teams for MNOs

The core of IHS Holding Limited's channel strategy involves dedicated teams working directly with major MNOs across Africa and Latin America. This isn't a passive listing model; it requires active negotiation for new sites and expanding service offerings on existing ones. The success of this channel is evident in the commercial progress reported, which drove organic revenue growth.

Key activities channeled through these teams in late 2025 include:

• Securing new build-to-suit contracts, such as the agreement with Brazil's TIM S.A. to potentially add up to 3,000 new sites nationwide.
• Driving Lease Amendments, which totaled 42,221 at the end of the third quarter of 2025.
• In the Nigerian segment alone during Q3 2025, the team secured over 1,700 lease amendments and more than 220 new colocations.
• Successfully navigating complex contract renewals, like the one with MTN Nigeria, which involved new financial terms balancing local and foreign currency exposure.

Long-term Master Lease Agreements (MLAs) as the primary delivery vehicle

The Master Lease Agreement (MLA) is the backbone of IHS Holding Limited's revenue certainty. These are long-duration contracts that provide a predictable cash flow stream, which is critical for financing infrastructure development and managing debt. The company's focus on securing these long-term commitments directly impacts its financial stability, as seen in the leverage ratio improvement.

The structure of these agreements is evolving to hedge against local market volatility. For instance, the renewed Nigerian tower MLAs with MTN Nigeria, extended until December 2032, now feature a multi-component structure:

• A USD component with annual escalators linked to the US Consumer Price Index.
• A NGN component with escalators linked to the Nigerian Consumer Price Index.
• A new component indexed to the cost of providing diesel power, acting as a hedge against fuel price spikes and FX fluctuations.

This contractual framework underpins the financial results. For the third quarter of 2025, IHS Holding Limited reported total revenue of $455.1 million and an Adjusted EBITDA of $261.5 million, resulting in a margin of 57.5%. The company's consolidated net leverage ratio stood at a comfortable 3.3x at the end of Q3 2025.

Local operational hubs across Africa and Latin America

IHS Holding Limited's physical presence, managed through local operational hubs, is the delivery mechanism for the contracted services. The company strategically concentrates its assets in high-volume markets to maximize scale and operational leverage, evidenced by recent portfolio optimization moves, such as the sale of its Rwandan operations.

The operational footprint as of late 2025, based on Q3 2025 tower counts and recent divestitures, is concentrated in key economies:

The total tower count at the end of Q3 2025 was 39,025, hosting 57,691 tenants for a Colocation Rate of 1.48x. The strategic pivot involves focusing capital expenditure, which totaled $77.3 million in Q3 2025, in these core, scaled markets.

Investor relations and public market communications (NYSE: IHS)

The final channel is the one directed at the capital markets, which funds the physical infrastructure build-out. IHS Holding Limited communicates its performance and strategy via its listing on the New York Stock Exchange.

The market channel reflects strong operational execution in 2025:

• Reported Q3 2025 Net Income of $147.4 million, a significant turnaround from the prior year's loss.
• Adjusted Earnings Per Share (EPS) for Q3 2025 was $0.45, substantially beating the analyst forecast of $0.10.
• Cash generation channels were strong, with Cash from Operations at $259.6 million and Adjusted Levered Free Cash Flow surging 81.2% to $157.8 million in the third quarter.
• The company raised its full-year 2025 revenue guidance to a range of $1.72 billion to $1.75 billion.

This strong performance through operational and contractual channels directly translates into investor confidence and capital availability.

IHS Holding Limited (IHS) - Canvas Business Model: Customer Segments

Tier-1 Mobile Network Operators (MNOs) in Africa and Latin America represent the core customer base for IHS Holding Limited.

As of the third quarter of 2025, IHS Holding Limited hosted a total of 57,691 Tenants across its portfolio. The Colocation Rate, which indicates the average number of tenants per tower, stood at 1.48x at the end of Q3 2025. Lease Amendments, which reflect deepening client ties through ancillary services, totaled 42,221 at the end of the third quarter of 2025.

Specific MNO activity shows both churn and growth within this segment:

• Lease Amendments increased by 1,904 in Q3 2025.
• Growth from Colocation and New Sites in Q3 2025 added 783 and 98 tenants, respectively.
• Churn in Q3 2025 totaled 3,415 tenants, inclusive of 2,576 tenants from the smallest Key Customer, 9mobile, who is vacating sites starting in Q3 2025.
• A reduction in revenues was partially offset by renewed and extended contracts with MTN Nigeria signed during Q3 2024, which involved approximately 1,050 sites MTN Nigeria agreed to vacate.

The operational data for the MNO customer segment as of Q3 2025 is detailed below:

IHS Holding Limited serves customers across Nigeria, Sub-Saharan Africa, the Middle East and North Africa (MENA), and Latin America (Latam), with the majority of revenue derived from Nigeria.

Internet Service Providers (ISPs) requiring backbone connectivity are served through continued fiber-optic expansions. In Latin America, a one-off increase in revenue of $3.6 million in Q1 2025 was driven by revenues from customer Oi S.A. ("Oi Brazil") following their judicial recovery proceedings. Furthermore, IHS Holding Limited announced an agreement with TIM S.A. to build up to 3,000 new sites in Brazil.

Government entities and security functions needing network coverage are served as part of the broader infrastructure offering, though specific financial figures tied directly to this segment are not separately itemized in the latest reports. The company's operational focus includes key markets where government stability is a factor, such as Nigeria, where sustained Naira positivity is noted.

Private corporations seeking in-building or small cell solutions are addressed through the demand for ancillary services, which drove Lease Amendments. The company's strategic focus on shareholder value creation included an agreement in May 2025 to dispose of 100% of IHS Rwanda at an enterprise value of $274.5 million.

IHS Holding Limited (IHS) - Canvas Business Model: Cost Structure

You're looking at the major drains on IHS Holding Limited's cash flow, the costs that keep those towers running across Africa and Latin America. Honestly, it's a story of operational intensity, especially with energy costs being a huge factor.

Power generation costs, heavily influenced by diesel prices, remain the single largest cost item within Cost of Sales, even with contractual hedges in place. For instance, in Q3 2025 segment results, there were noted increases in the cost of diesel and electricity contributing to higher cost of sales and administrative expenses, though falling diesel prices partially offset revenue indexation effects. This cost category is critical because it directly impacts profitability before accounting for depreciation.

The other major recurring expenses involve the physical footprint of the infrastructure:

• Site rental and ground lease payments, as IHS leases the ground under a significant majority of its sites, typically under fixed-duration contracts.
• Staff costs, maintenance, and security services for remote sites, which are essential for operational uptime.
• Tower repairs and maintenance costs also contribute to the overall operating expense base.

When you look at the capital side, the investment for growth and upkeep is significant, though management has been focusing on capital discipline following asset sales.

Here are the key financial numbers related to capital deployment and debt as of late 2025:

The interest expense tied to the debt load is a major fixed cost. Despite the deleveraging efforts, the consolidated net debt was reported at less than $3.3 billion at the end of September 2025. This debt level, combined with the refinancing activities completed in late 2024, means interest payments are now phased, with the bulk due in the second and fourth quarters of the year, which affects quarterly cash flow timing.

The Capital Expenditure guidance for the full year 2025 remains in the range of $240M-$270M, which includes an assumption for approximately 600 new sites. The actual spend in Q3 2025 was $77.3 million, reflecting the phasing of maintenance and augmentation capital expenditure, predominantly in the Nigeria segment.

IHS Holding Limited (IHS) - Canvas Business Model: Revenue Streams

You're looking at how IHS Holding Limited actually brings in the money, which is all about long-term infrastructure contracts. Honestly, the revenue engine is quite straightforward: you build it, you lease it, and you adjust the price over time.

The core of the revenue comes from long-term leasing fees from colocation on existing towers. This is the bread and butter, where multiple tenants share the same physical tower space. For instance, at the end of the third quarter of 2025, IHS Holding Limited hosted a total of 57,691 tenants across its portfolio, maintaining a Colocation Rate of 1.48x. This metric shows how effectively they are monetizing each asset by stacking multiple tenants on a single tower. The organic revenue growth for the third quarter of 2025 was 6.6%, which was propelled by this continued growth from Colocation, alongside other key drivers.

Next up is revenue from new site construction (Build-to-Suit). This is where IHS Holding Limited acts as a developer for a specific customer need, often under a long-term contract. A concrete example of this pipeline is the new site agreement announced in October 2025 with TIM S.A. in Brazil, which aims to build up to 3,000 sites, starting with an initial minimum deployment of 500 sites. Growth from New Sites was explicitly cited as a driver for the Q3 2025 organic revenue increase.

The third major component involves contractual adjustments, specifically lease amendments and escalators (CPI and power indexation). Lease Amendments represent revenue generated from existing tenants adding more equipment or services to a tower, deepening the relationship. By the end of the third quarter of 2025, total Lease Amendments stood at 42,221. Escalators, which include Consumer Price Index (CPI) and power indexation, provide a built-in inflation hedge, though the full-year 2025 guidance noted a modestly lower contribution from power indexation due to lower diesel prices.

Here's a quick look at the key revenue drivers and operational scale as of the latest reported quarter:

Looking ahead, the management's expectations for the full fiscal year 2025 reflect confidence in these revenue streams, despite currency pressures like the volatility of the Nigerian Naira, which saw a 3.7% appreciation versus the USD in Q3 2025.

The forward-looking financial targets for the full year 2025 are:

• Full-year 2025 revenue guidance is $1.72 billion to $1.75 billion.
• Adjusted Levered Free Cash Flow (ALFCF) guided at $400 million to $420 million for 2025.

The strong cash conversion is also evident in recent quarterly performance; for example, the third quarter 2025 ALFCF reached $157.8 million, a significant jump from $87.1 million in the prior year period. This demonstrates the operational leverage inherent in the leasing model once initial site construction costs are covered.