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Amazon lease termination approved by Grand Forks city committee

A Grand Forks city committee agreed Monday to terminate a lease with internet retail giant Amazon for its customer service operations.

The Growth Fund Committee's vote comes after Amazon moved to a home-based staffing model for its local customer service operations earlier this year. It notified the city it was exercising its right to terminate its lease after September 2018.

But the lease termination agreement approved Monday means the company would pay roughly $845,000 to terminate its lease on Sept. 14. Meredith Richards, the city's planning and community development deputy director, said it amounts to a buy-out of its lease.

The payment represents about 90 percent of the total rent that would have been paid in 24 installments, as well as full payment of the outstanding principal balance of a fit-up loan, according to a city memo.

"They asked to be released and this does appear to be a pretty equitable approach to doing that," Richards said.

Keith Lund, vice president of the Grand Forks Region Economic Development Corp., said "taking the keys back" may make the space easier to market to future tenants. Amazon began occupying about 29,000 square feet in the building at 1400 S. 48th St. in west Grand Forks in September 2011.

The lease termination agreement goes before the Grand Forks Jobs Development Authority on Sept. 6.

Amazon said in March it would offer its 100-plus customer service employees in Grand Forks the option to work from home. The change isn't expected to result in workforce reductions or affect the Seattle-based company's seller support operations in Grand Forks.

John Hageman

John Hageman covers North Dakota politics from the Forum News Service bureau in Bismarck. He attended the University of Minnesota in the Twin Cities, where he studied journalism and political science, and he previously worked at the Grand Forks Herald and Bemidji Pioneer.  

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