Electric Boat Signs New 25-Year Lease With Quonset

General Dynamics/Electric Boat has signed a new 25-year lease with Quonset Development Corp., Gov. Chafee announced Tuesday. As part of the deal, EB will lease an additional 42 acres at the business park.

The QDC board of directors approved the deal during its monthly meeting Tuesday. 

The new lease gives EB "the flexibility it needs to construct new, specialized facilities for submarine programs," according to a press release from the governor's office.

Under its current lease, EB leases 100 acres at Quonset, and owns an additional 33 acres. The company performs a variety of activities at Quonset, including manufacturing, hull fabrication, modular construction, coating and steel processing. EB has been manufacturing at Quonset since 1973; the 25-year lease marks the longest lease it has yet held at Quonset.

The new lease includes an incentive package which provides a discount depending on the length of the lease – the longer the lease, the steeper the discount – and an additional discount for job creation. EB will get a 16 percent discount under the new lease for taking a 25-year lease. All new lease holders are offered that deal, regardless of business size.

EB can further cut its lease payments by increasing its payroll. QDC will allow submarine maker to cut one half of 1 percent of the amount of wages it pays (as reported to the state) from its rent. 

Electric Boat employs more than 2,500 people at Quonset, at an average wage in excess of $50,000, not including benefits, according to the press release. The company has also invested more than $900 million at Quonset since it established its manufacturing site there in 1973. In the last three years, Electric Boat has spent $112 million at 270 Rhode Island based suppliers.

“Today’s announcement means more good paying jobs with excellent benefits for Rhode Island and will help boost our economy,” said Gov. Chafee. “Quonset has become one of the premier business complexes in the northeast, and it includes Electric Boat’s facility where modular construction of submarines was pioneered and continues to be perfected.”

Quonset Business Park is now home to more than 175 companies, employing approximately 9,500 people in full-time and part-time jobs in many industries.  The Port of Davisville at Quonset is also one of the top 10 auto-importers in North America. Electric Boat is a wholly owned subsidiary of General Dynamics (NYSE: GD), and the largest employer at the business park. 

QDC is a quasi-governmental organization that manages the Quonset business park, which is part of the Town of North Kingstown. QDC gives the town payments in lieu of taxes and QDC tenants also pay town property taxes.