Lease Reform

I wish someone would…..

Cut down the paperwork I have to do to submit an offerDONE!!!

Get rid of some of these studies and reports that cost

too much moneyDONE!!!I wish someone would…..

Cut down the entire process so I can get my RENT faster!

DONE!!!DONE!!!DONE!!!

I wish someone would…..

What is Lease Reform?•A national effort lead by Central Office to change the way we do leasing▫Simplifying▫Standardizing▫Streamlining

•Comprehensive changes to both the forms, processes, and philosophy

•Initiatives focused on two major areas▫Process revisions▫Leasing models

•Results in a more balanced, user-friendly approach for the private sector

Serious ChangesSignificant Benefits

Better Organized Documents

A More Balanced

Relationship with the Private

Sector

New Leasing Models and Processes

Lease Reform

Serious ChangesSignificant Benefits

Better Organized Documents

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The Solicitation for Offers

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The Request for Lease Proposal

The Lease

The Solicitation for Offers

The Request for Lease Proposal

The Lease

How GSA will select the Lessor

The Contract

The Solicitation for Offers

Describes how GSA will determine the winner of the

procurementMinimum and maximum square footageDelineated AreaAward Criteria Lowest Price Technically

AcceptableAward Factors

Accessibility, Seismic, Fire Safety, Other Criteria

Request for Lease Proposal

The Request for Lease Proposal

The Lease

The ContractHow GSA will

select the Lessor

The Solicitation for Offers

The lease that the Lessor is expected to sign upon being

selectedThe clauses governing the duties and obligations of the Government and LessorProcedures for initial alterations

Cleaning and maintenance

Mandatory “General Clauses”

Architectural and engineering standards for construction and performance of base building systems

The Contract

Serious ChangesSignificant Benefits

Better Organized Documents

A More Balanced

Relationship with the Private

Sector

New Leasing Models and Processes

Lease Reform

Serious ChangesSignificant Benefits

New Leasing Models and Processes

New Lease Models• 5 new Lease Models tailored towards different types of common

lease types▫Simplified - small leases with no special requirements▫Streamlined - small to medium sized leases with few special

requirements▫Standard - any size lease potentially with complex build-out needs▫Succeeding - continuing occupancy at the existing location▫On-Airport - specific towards leases at airports (TSA)

• Documents and procedures are scaled and customized for each type of project

• Results in much faster projects and lower lease costs

Simplified Lease Model

Maximum speed

Designed for small offices with no special requirements

Turn-key lease

All ASRs requirements identified up

front

All DID drawing reviews

expedited, no reviews of CDs

Faster occupancy, rent starts sooner

Streamlined lease ModelTurn-key and TI Allowance Options

Designed for small to medium sized offices with few special requirements

DID Workshops

All ASRs requirements identified up

front

DID Workshop

Faster cycle time and flexibility to handle special requirements

Standard lease Model

TI Allowance model

Designed to accommodate larger leases with potentially complex build-out requirements

Maintain the agreed upon

schedule

Cycle time 18-24 months

Can handle complicated build-outs

Succeeding lease ModelTurn-key lease

Designed to provide an expedited procurement process for continuing occupancy at the current

locationFeatures faster, more open negotiations with

the current Lessor

Continuing occupancy with minimal

alterations required

Provides stability for

both the Government and Lessor

DID WorkshopsA collaborative meeting hosted by the Lessor after

awardSpeeds up the post award process by months

Increased collaboration enhances customer satisfaction

Turn-Key LeasingAgency specific requirements

(ASRs)

•A faster and fairer process for both the Government and the private sector

•Offerors submit a bid that includes the actual cost of the required tenant improvements▫Offerors with spaces that will cost less to complete are no longer required to bid the same TI allowance as Offerors with space that will cost a lot more

▫All required tenant improvements are identified up front, eliminating delays after award waiting for the tenant to provide information

•Results in faster projects and lower lease costs

Serious ChangesSignificant Benefits

Better Organized Documents

A More Balanced

Relationship with the Private

Sector

New Leasing Models and Processes

Lease Reform

Serious ChangesSignificant Benefits

A More Balanced

Relationship with the Private

Sector

Reduced Paperwork

The Old Way The New WayThe New Way

Initial each page of the

SFO

Initial each page of the

SFO attachments

Complete the required fire safety

and seismic studies

Complete the 1364,

1217, 3518

Initial any other specifically

required items

E-mail Offers

The Old Way

Offers must be physically delivered in

hardcopy

E-mail Offers

The New WayThe New Way

Offer documents may be scanned and

emailed to the LCO or designated rep

reduced Pre-lease fire safety reviews

The Old Way

Every building required a pre-lease Fire Safety ReviewWhenever GSA leased space over the 6th fl, additional information was required and the

report had to be certified by a fire safety engineer

reduced Pre-lease fire safety reviews

The New WayThe New Way

All leases under 10,000 ABOA on the ground floor exempt

All other leases exempt provided they meet the following:

Alarm System

Exits

Sprinklers

C of O issued under any

version of the IBC

Minimum Fire Safety Requirements

Alarm System

Exits

Sprinklers

Less than 25 yrs old

Anytime space is leased above the 6th fl the building must have sprinklers up the highest floor of Government

occupancy

Space and floor must have 2 exits

The International Building Code (IBC)

•Adopted to some degree in every state▫Effective statewide - Florida, Georgia, N. Carolina, S. Carolina, Kentucky

▫Effective locally - Alabama, Mississippi

•Any version (year) is acceptable

•If your Certificate of Occupancy does not reference the IBC, contact your local code department to determine if your CofO is in compliance with the IBC▫Grandfathering is not acceptable for exemption purposes

reduced seismic Studies

No Seismic Reviews

Exempt under 10,000 ABOA

No Exemption

s

Revised General ClausesGeneral clauses are part of every GSA contract

Major Changes

Subletting and Assignment

Fire Casualty

Now subject to prior written consent of the

LessorLessor now given a set period of time to

repair prior to the Govt having the right

to terminate

More Balanced Approach

•Offerors are forced to commit their space to GSA procurement for a long time▫No cash flow until occupancy

•Successful Offerors must then continue to wait through a lengthy design and build-out process before they receive any payment

•This new process is more balanced to our private sector business partners

Expedited design and construction period

Expedited space procurement

The Old WayThe Old Way

The New WayThe New Way

Lessor commits space to GSA procurement

Agency Occupies

Space

GSA receives a space request

Lessor receives award but still has no cash flow through design and

construction

12+ Months6-8 Months

GSA develops requirements

Agency Occupies

Space

GSA receives a space request

6 Months3-6 Months

Old vs. New

Lease Reform

Lease Reform is on on-going process, GSA will continue to look for ways to promote a fair and

more efficient process

.....and we’re not done yet

Around here, however, we don't look backwards for very long. We keep moving forward, opening up new doors and doing new things, because we're curious.....And curiosity keeps leading us down new paths.

- Walt Disney

Final Thought

keep moving forward

Lease Reform