Recent Developments in Federal Facility Privatization
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Transcript of Recent Developments in Federal Facility Privatization
Recent Developments in Federal Facility Privatization
NCPPP P3 Connect July 2014
Marc WaddillSenior Vice President, Public InstitutionsJLL
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Introduction
• Federal Government owns or leases approximately 360,000 buildings and 3.3 billion square feet of space
• Major Real Estate Holding Agencies:− Department of Defense (Army, Air Force, Navy)− General Services Administration (GSA)− Department of Veterans Affairs (VA)− Department of Energy (DOE)
• Privatization Tools:− Fee Simple Disposal− Long-term Ground Lease (EUL, Section 111)− Exchange
Fee Simple Disposal
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• GSA Success Stories
Georgetown West Heating Plant
• Approximately 2 acres• Approximately 110’ tall
Bethesda Federal Building
• 10-story building
• Approximately 130K SF
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Fee Simple Disposal
• Pipeline:− Primarily residential single family houses− Non residential includes mainly USPS sites, small tracts of land,
SSA buildings, and small border patrol buildings− Unique Opportunities: Alan Bible Federal Building (Las Vegas)
Plum Island (NY)
• Issues to Consider:− Private Sector Market− As-is / Where-is− Entitlements− Other Environmental Constraints
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Enhanced Use Lease (EUL)
• Agencies with EUL Authority:− Department of Defense (Army, Air Force, Navy)− Department of Veterans Affairs (VA) − National Aeronautics and Space Administration (NASA)
• Issues to Consider & Recent Trends:− Asset versus Market− Acquisition versus Disposition− Development of Single Asset versus Multi-Phase Development− Cash Consideration versus In-Kind Consideration
EUL: VA Affordable Housing
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EUL Project Name Date Closed Total Number of Units1 Canandaigua, NY 9/17/2012 33
2 Dayton, OH 11/7/2013 55
3 Hines, IL 12/13/2013 122
4 Lyons, NJ 8/9/2012 61
5 Minneapolis, MN 5/12/2014 58
6 Newington, CT 9/7/2012 74
7 Roseburg, OR 10/5/2012 55
8 Tuscaloosa, AL 8/13/2013 50
• Asset: Individual Building or Parcel for Specific Purpose• Financing: Primarily Low Income Housing Tax Credits (LIHTC)• Veteran Preference as Primary Consideration
EUL: VA Fort Howard Existing
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Site Summary: Approximately 100 acres and 44 historic improvements (305k GSF) on the entire campus
EUL: VA Fort Howard Future State (Conceptual)
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EUL: Army EUL Projects
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Project Project Description
Aberdeen Proving Ground - Maryland Boulevard
2M square foot class A office development on 250 acres; includes supporting retail
Fort Detrick Central Utilities Plant, MD
Central Utility Plant providing steam, chilled water and conditioned electric supply to National Medical Biological Defense Interagency Campus
Fort Leonard Wood, MO 32-acre business and technology park
Picatinny Arsenal, NJ Potential development of 1M square feet on 120 acres; R&D, office and flex space
Redstone Arsenal, AL Mixed use development of 3-4M square feet on 400+ acre site. R&D, labs, hotel, academic space and retail
Yuma Proving Ground, AZ Automotive Test Facility on 2500+/- acres; Army has use of the GM facility, and GM has constructed an automotive test track for Army's use
EUL: Air Force EUL Projects
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Project Project DescriptionJoint Base San Antonio (Fort Sam Houston)
Developer leased 3 abandoned buildings and 10 acres of vacant land on Fort Sam Houston. Developer will develop additional office building on vacant land.
Eglin AFB Water Reclamation256 acres for maintaining an existing sewage effluent disposal field and construction of a 10M gallon per day wastewater treatment plant and a rapid infiltration basin effluent disposal system. Leased parcels are located outside gate.
Eglin AFB Airport108 acres to operate an existing airport terminal and construction, operation, and maintaining a fuel farm along with facilities for rental car agencies on an additional 23 acres. Leased parcels located outside gate.
Nellis AFB Wastewater Treatment Facility City of North Las Vegas developed wastewater treatment facility on 41 acres.
Hill AFB Office ParkMixed‐use commercial development on approximately 550 acres. The purpose of the project is to develop an aerospace research and technology park to benefit both the community and the AF. Potential to build up to 26 commercial buildings, 2 hotels, and 4 retail.
Eglin AFB Hotel17-acre parcel with 600 linear feet of beachfront. 152-room hotel to be constructed with development of retail pad. Provisions for second hotel if financial metrics met. Parcel located outside gate.
EUL: Navy EUL Projects
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Project Project Description
Moanalua Shopping Center, HI
Lessee constructed a 55,000-square-foot support services center for the Navy as in-kind consideration. The Navy pays no rent on the building, which was built for about $17 million
Lessee developed 30,000 square feet of commercial space for private-sector tenants
Port Hueneme, CA – GAPS Industrial (Global Auto Processing Services)
Use limited to storage & processing of motor vehicles
NB Point Loma, CA - ULA Industrial Lease (United Launch Alliance)
Leased for Production, Research and Development of Atlas Launch Vehicles and related components
NB San Diego, CA – NASSCO Industrial Lease Industrial space to aid in ship construction
NAS Key West, FL – Mole Pier Commercial Lease
Outer Mole Pier is currently outleased to the City of Key West and utilized for cruise ship berthing
EUL: NASA Ames Research Center (ARC)
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• ARC has over 50 EUL agreements • Tenants include Planetary Ventures (a subsidiary of Google, Inc.) and the
University of California• Received the 2003 GSA Achievement Award for Real Property Innovation
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Exchange for Services
Equity Investment ($608M)
Private Sector Ownership
Conveyance of Forrestal to Private Sector
Year
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Year 9 Year 10
Proj
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imel
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Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8
Services Period: Construction, Renovation, and Other Services
Value of Asset is Realized by Private Sector
Capital Investment
Private Sector Ownership
Conveyance to Private Sector
• Issues to Consider:− Timeline− Services (level of detail, timing, change orders…)− Ownership Risks (As-is / Where-is, Entitlement Risk, etc.