SFBC landlord seeks to terminate Miami facility lease

By Angela McDaniels

Seattle, Jan. 30 - SFBC International Inc. said it will vigorously defend a lawsuit seeking to terminate a ground lease on a portion of its Miami facility.

"In this case, the landlord-lessor is attempting to misapply language in a 59-year-old document to achieve an unconscionable windfall," company attorney Thomas Tew said in an SFBC news release.

The company said one of its subsidiaries has been named as a defendant in a declaratory judgment action filed in Miami-Dade County Circuit Court by East Bay Corp., which owns a 99-year land lease for a portion of the property on which SFBC conducts some of its Miami operations.

SFBC said the lawsuit is based on issues related to its Miami facility such as structural concerns and the subsequent issuance of a permit to make improvement, all of which the company has been actively addressing with Miami-Dade officials.

In the lawsuit, East Bay alleged that the terms of the lease had been violated and that it was entitled to immediate possession and full ownership of the land, as well as the building now owned and operated by SFBC.

The land lease involves the company's south building - which contains 51 beds, SFBC's clinical laboratory and its offices - a portion of the annex and part of the parking for the property. SFBC said it purchased the north building, the annex, the south building and remaining land used for parking in February 2004. Clinical trials are conducted in both the north and south buildings.

Other than the land and structures covered by the land lease, all of the remaining land and structures are owned by SFBC, according to the release. Under the existing terms of the lease, SFBC pays East Bay an annual rent of $16,000, subject to future escalations.

The land lease was originally entered into in January 1947 between East Bay and Ocean Freeze Corp. for a term of 99 years. SFBC International's subsidiary is a successor to that agreement.

SFBC is based in Princeton, N.J., and provides early and late stage clinical drug development services to branded pharmaceutical, biotechnology, generic drug and medical device companies.

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