When Growth Cooled, ICON Turned Office Space into Ad Space
Lennox Industries is a worldwide leader in residential and commercial heating, cooling and ventilation systems. It faced an ironic challenge: more office space than it wanted to heat, cool or ventilate for itself within its corporate headquarters campus in Richardson, Texas. Unfortunately, the company had entered into a long-term lease to obtain control of the space for future growth, which was occurring slower than anticipated. Lennox considered the obvious choice first – subleasing – to recover some of the excess overhead but found that the market price for real estate in the region had fallen significantly below what it was currently paying.
How ICON Uncovered Value
Corporate barter offered a creative solution: ICON sublet the excess space for the full cost of the space, plus expenses, in exchange for 5 years' worth of trade credit. Over the next 60 months, Lennox redeemed its credit with the purchase of media for several of the company’s product lines.
The transaction worked out so well that when it was completed, Lennox entered into a similar agreement for a flex/light manufacturing facility on the other side of the country.
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