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Interstate Tenant Saves Dopaco $11Million After Lease Renegotiation

Dopaco is a leading manufacturer of paper and plastic products for the quick-service restaurant and food distribution industries. It creates custom packaging for each of its clients.

Challenges

During preparation for renewal negotiations, Dopaco was informed that new rent specifications would be implemented, which would exceed the market value.

Dopaco had invested millions of dollars in machinery and production equipment for their 400,000 square foot building. Relocation would cause a major financial loss and would put 275 people in rural Kinston, North Carolina out of work.

Solution

Our team provided Dopaco with several options for a practical, cost-effective relocation by

  • Researching real estate values, tax costs, and labor rates in neighboring counties and states
  • Performing a supply chain study
  • Conducting a lease vs. buy analysis and
  • Negotiating state tax incentives.

We presented this information to the landlord, providing a speedier negotiation and a significant rent reduction.

Additionally, our team secured substantial financial incentives from the local government.

Results

Lease Renewed for an Additional 10 Years

 

Reduced Rent Payments by $5.7 Million Over the 10-Year Lease Extension

 

Negotiated $5.3 Million in Financial Incentives from Lenoir County Government

Long-Term Success with Interstate Tenant Breeds Millions in Savings

This was the seventh deal in our long-standing relationship. In each instance, our team provided viable, cost-effective relocation options, but was able to secure an even better deal in their current location.