School District Saves $28 Million

In the winter season of 2014 the Alvord Unified School District found itself in an uncomfortable spot: it had to vacate a district building deemed by its architects and structural engineers as “not safe for occupancy.”

With just a few weeks to spare, the district scrambled to find new facilities to house its departments and temporarily relocate to portable classrooms at school sites while the district looked for a long-term solution for its administrative offices.

After a hectic search, the district signed a lease for office space that would consolidate the departments into one building. But it wasn’t long before the district discovered that the lease was highly unfavorable to them. The document contained multiple open-ended provisions that included unlimited financial exposure to the district and unreasonable lease terms.

The district was in a bind. On one hand, it desperately needed to move into a new space. On the other, it was stuck with a bad lease—or so district officials thought.

“We did not believe there was much hope to renegotiate any of the terms,” said Kevin Emenaker, the district’s executive director of administrative services.

In a last-ditch effort to save the district from its predicament, the district contacted Todd Dorn, aka The Lease Doctor. The district’s board contracted Dorn to review the lease and suggest ways to renegotiate a contract that was more favorable to the school district.

Dorn studied the lease and found that it contained a clause that worked in the district’s favor. On his advice and with his help, the district board successfully renegotiated the lease.

“Todd accomplished what we believed to be an impossible task,” said Emenaker.

“By finding a loophole in the lease language that gave us the leverage to renegotiate the contract, Todd is credited with saving the district over $28 million.”

Dorn, who has 35 years of experience in analyzing and negotiating commercial leases, helped the district save an additional $227,000 when he found a major calculation error in the lease pertaining to the measurement of the building. As a result, the school district was also able to secure an option in the renegotiated lease to purchase the building and gain other benefits.

Renegotiating the lease and forcing the landlord to rewrite it was no easy task for Dorn.

“We were brought in to help the school district in restructuring a 65,000-square-foot lease they had already signed,” said Dorn. “On the surface, it appeared to be a lost cause, as it was a lengthy custom lease that was very one-sided and entirely favored the landlord.”