CANADA/USA. Peace Bridge Duty Free has had its lease to operate the duty free shop on the Canadian side of Peace Bridge renewed following the completion of a Request for Proposals (RFP).
The contract to run the 28,000sq ft duty free shop has a term of 15 years with a five-year renewal option, and is set to begin on 1 November.
The Buffalo and Fort Erie Public Bridge Authority said it received six proposals in total. It awarded the concession to incumbent Peace Bridge Duty Free “after a thorough review by a selection committee that determined Peace Bridge Duty Free scored the highest of all proposals submitted and would deliver the best value to the [authority]”.
The authority owns and operates the Peace Bridge, which is located at the Niagara River Crossing between Buffalo, New York and Fort Erie, Ontario. Peace Bridge is the second busiest border crossing between Canada and the US with around 5.5 million vehicles crossing each year. Sales at the duty free shop have been between C$20 million and C$25 million a year in the past five years.
“Peace Bridge Duty Free has proudly served Fort Erie and those traveling to the United States for almost thirty years, and we welcome the opportunity to do so for many years to come,” said Peace Bridge Duty Free President Greg O’Hara. “We are excited about the plans we have for the store, and look forward to unveiling them in the weeks and months ahead.”
Peace Bridge Authority Chairman Sam Hoyt stated: “We are pleased that we were able to reach agreement with Peace Bridge Duty Free. The rental revenue generated by the Duty Free shop is an important source of non-toll revenue for the authority and enables us to keep bridge tolls as low as possible for the benefit of the bi-national region.”
Rent for the duty free shop consists of two categories; an annual base rent and a percentage rent payment that is based on gross sales. The base rent is a fixed minimum annual rent of C$2,500,000 that is payable on a monthly basis and is subject to increase each year depending on the gross sales achieved during the prior year. The percentage rent is also payable monthly and is a percentage of all of the gross sales achieved from the leased premises.
