The Port of Vancouver is poised today to put the final touches on resolving a dispute with a tenant, Northwest Packing Co., over how much rent the fruit processor should pay.
Under proposed changes to the company’s lease, the port would gradually move Northwest Packing to an annual rent based on fair market value. Meanwhile, the company would get the ability to opt out of the initial term of its revised lease if it decides to move out of Clark County for business reasons.
Port commissioners Nancy Baker, Brian Wolfe and Jerry Oliver are expected to approve the proposed changes during their regular public meeting at 9:30 a.m. today at the port’s office, 3103 N.W. Lower River Road in Vancouver.
The landlord-tenant dispute, at times public and contentious, stretches to at least 2011. That’s when the port extended Northwest Packing’s lease, established in the mid-1980s, through the end of last year as negotiations continued.
At one point, Northwest Packing urged the port to maintain the company’s annual lease payment of $149,439 as part of a larger 25-year contract renewal. That would help the company’s competitiveness, the company said, in the face of industry consolidation and other challenges. Otherwise, the company said, it might have to relocate.
The port countered that the company was contractually bound to move to a higher annual lease payment — $372,021 — based on fair market value.
Northwest Packing employs 355 full-time equivalent employees on an average annual basis, according to the port. The company, a subsidiary of The Neil Jones Food Co., processes a variety of fruits for canning, juices and sauces.
Under the proposed changes to the lease — which covers an initial extension term of 10 years — the company’s annual rent for 2015 would be $251,621.54. Its rent would increase by $25,000 each year afterward for the next four years.
For the second five years of the initial 10-year term, which would begin on Jan. 1, 2020, the company’s rent would be reassessed based on fair market value. However, if that reassessment increases the company’s rent by more than $15,000 over the previous year’s rent, the port would cap the rent increase at $15,000 for the first year. After that, the company’s rent would increase by $15,000 a year until it reaches the rate determined by the earlier fair market reassessment.
Meanwhile, Northwest Packing would receive three five-year options to lengthen its lease with the port from the initial 10 years to as many as 25 years. During the initial 10-year term, the company also would have one opportunity to terminate the lease, at the end of 2019, if it decides it must relocate for business reasons.
If the company exercised that right, it would have to give the port one year’s notice.
In November, the port announced it had reached a tentative agreement with Northwest Packing on a 25-year extension of the company’s lease. At the time, the port did not disclose terms of the deal.
Northwest Packing has been a port tenant since 1973. Its 15-acre site includes more than 670,000 square feet of space.
