NEXE Innovations has sold its original coffee pod development facility in Surrey, B.C., to an undisclosed buyer for $5.7 million.

The property was debt-free at the time of the sale, enabling NEXE to earn a tidy profit on the transaction.

Now based in Windsor, Ont., NEXE said it purchased the property in 2016 for $1.37 million and invested about $1 million in tenant improvements for a total initial investment of approximately $2.4 million. The facility was used primarily for research and development and developing the first versions of the NEXE’s compostable coffee pods.

The company has since vertically integrated all of its operations into a Windsor plant to be competitive on the price of compostable pods, which remove the need for plastic, and build scale quickly.

“We believe our move to reshore all of our operations and bring each step of the manufacturing process in-house gives us a competitive edge, ensuring we can offer superior products at a competitive price,” Ash Guglani, president and co-founder of NEXE, in a news release.

With its strategic location near the Canada-U.S. border, the Windsor plant is within about a 1,000-kilometre mile radius of a market of approximately 100 million people, the company noted. The Windsor plant also allows NEXE to maintain control over quality, protect intellectual property and trade secrets, and shorten the R&D cycle for new products.

NEXE plans to invest the $5.7 million from the Surrey property sale in operations, sales, and marketing. 

Photo: NEXE