210 Beiser Blvd, Dover, DE

Highlights

• The full building lease to GSA for the use of DHS/ICE was approaching its expiration with an unfavorable 5-year option in place
• CBRE FLAG was engaged to convince GSA to revise the option to be for a longer term and with a higher rent
• A Lease Amendment was ultimately executed replacing the existing option with a new 10-year firm term option at a higher rental rate in exchange for the Landlord providing certain improvements the tenant agency needed but could not fund itself.

Challenge

• Our client owned an asset that was fully leased to GSA for the use as the Dover Delaware Department of Homeland Security, Immigration and Customs Enforcement (DHS/ICE) Office, with a lease approaching its expiration date but included a single 5-year renewal option at a below-market rental rate
• Two and a half years before the lease’s expiration, CBRE FLAG was engaged to convince the Government not to exercise the existing option but instead, extend the term of the lease for a longer term and at a higher rental rate
• Working with the Property Management team, and engaging with the tenant agency directly, CBRE FLAG was able to determine that ICE not only desired to stay at this location but also that they desired several improvements to the site, the building, and within the leased space but had no way to fund such improvements due to persistent budget pressure

Results

• Through many rounds of negotiation, CBRE FLAG was able to convince GSA to add and then exercise, an option into the lease to supersede the existing unfavorable option with a new 10-year firm term option
• The new long-term option included a rental rate much more desirable to the landlord in exchange for the design and construction of certain improvements desired by the tenant agency all of which ultimately cost the Landlord just approximately $30.00/sf