Client:

PS Business Parks, L.P.

Primary Services Provided:

• Development of GSA Leasing Strategy
• Financial Analysis of Offer
• Preparation and Submission of Offer
• Negotiation of Offer
• Development of Lease Language
• Conflict Resolution of Leasing, Construction and Management Issues
• Post Lease Award Services

Project Overview:

1-95 Corporate Center is a three building Class “A” flex/office center located in the Newington/Springfield market. Building 3, equal to 67,000 SF, was formerly occupied by a “slow paying” tenant. PS Business Parks engaged Public Properties to position I-95 Corporate Center to the federal government. Due to the non-existence of a procurement vehicle to offer the project to the government, Public Properties utilized target marketing and unsolicited proposals to create opportunities for the space. Through Public Properties’ relationship with both the State Department and GSA, Building 3 became a prototype space for an emergency national security requirement. GSA, on behalf of State Department, acquired the lease as a sole source negotiation.

Primary Leasing Strategy:

• Eliminate vacancy risk from delinquent tenant
• Focus re-tenanting on a credit tenant
• Attract credit tenant with minimal concessions
• Maintain IRR for REIT ownership

Meeting Client Needs:

• Utilized “unsolicited offers” and “other than full and open justification” as procurement vehicle
• Negotiated “As Is” language clause – reduced ownership’s
  ongoing exposure to provide maintenance and replacement
  to existing warm-lit-shell
• Improvements including mechanical systems
• Negotiated lease language to clarify ownership and government responsibilities
• Eliminated ownership’s janitorial responsibilities to the space
• Negotiated annual reconciliation language for all utilities

Cost to Client:

Public Properties achieved i) a fair market rate with a credit tenant; ii) an IRR that exceeded ownership’s expectations; iii) a 10 year firm term lease structure; and iv) a lease with GSA prior to removal of “slow paying” tenant. In addition, ownership’s ongoing management and cost exposure were clarified, greatly reducing the potential of unknown expenditures and lease conflicts.