Download - Defining, Developing and Delivering the Vision Strategic Educational Facilities Development
Defining, Developing and Delivering the Vision
Strategic Educational Facilities
Development
Developer led Turnkey Lease-Purchase Project Delivery Program
TAX EXEMPT turnkey lease purchase project delivery is the best way for School Districts, Colleges and Universities to acquire critical education, recreation and administration facilities.
Developer Led Turnkey Lease-Purchase Project Delivery Program
BETTER THAN Pay as you go General Obligation Bond Financing Private (taxable) lease-lease back Design-Bid-Build Construction Manager at-risk Design-Build
What You Will Learn in this Presentation
The advantages of the developer-led tax exempt lease purchase project delivery process
How the process works Case studies of successful projects Overview of enabling legislation
Swisher Garfield Traub Development
Stephen Swisher, AIA- Principal, Las Vegas Office 30 years of industry experience architecture & development Educational facilities and sustainable design expertise Leads Programming, Planning and Design consultant team
Raymond Garfield Jr.- Principal, Dallas Office 30 years of experience in development, finance and asset
management of all property types Extensive Wall Street background, focusing on working with
investment banking partners to create innovative financing structures.
Jill K. Sweeney- Principal of Brownstein/ Hyatt/ Farber/Schreck Leads the Public Finance Group of B/H/F/S Focused practice on government finance law, economic
development and state tax incentive law, government relations and securities law
Serves as bond counsel for the New Mexico Finance Authority, New Mexico Board of Finance, the University of New Mexico and the City of Albuquerque
Swisher Garfield Traub Development
National Developer of essential facilities for PUBLIC SECTOR clients
Specializes in TAX-EXEMPT turnkey lease-purchase project delivery
Over $2 billion tax-exempt public/private lease-purchase developments in progress or recently completed
More than 30 years, $11 billion and 27 million square feet of development and finance experience with all property types
Tax Exempt Turnkey Lease Purchase Project Delivery Program Benefits
Fastest Project Delivery Lowest cost of ownership Maximum owner control Highest degree of
collaboration
Tax-Exempt Turnkey Lease Purchase Project Delivery Program Benefits
Fastest Project Delivery No Public Referendum required Developer led team can establish GMAX and
break ground 1 year sooner No separate selection process for architect or
“bridging” architect Concurrent contractor pricing eliminates time
and expense for re-bidding Allows for faster “fast track” delivery and
close-out Alignment of interests speeds completion Eliminates delay claims, RFI games and
change orders
Project Delivery Methods
Tax-Exempt Turnkey Lease Purchase Project Delivery Program Benefits
Lowest Cost of Ownership Financing costs competitive with general
obligation bond rates Earlier start saves construction inflation Earlier completion saves on modular costs Minimizes owner facility staffing (owner
doesn’t have to “referee”) Lease can include maintenance or capital
replacement reserve
Impact Delay of Costs
Project Financing
Total Occupancy Cost Comparison
But if you start 1 year sooner….
*Includes 8% cost escalation and modular unit rental cost
Tax-Exempt Turnkey Lease Purchase Project Delivery Program Benefits
Maximum Owner Control Non-profit beneficial “owner” is the
government entity, school district, college or university
Open book transparent process Review competitive pricing of
construction line items Real time pricing and life cycle cost
analysis Single source of responsibility
Financing/Ownership and Flow of Funds
Tax-Exempt Turnkey Lease Purchase Project Delivery Program Benefits
Highest degree of Collaboration Fully integrated team Single source of responsibility Project-type and “industry”
expertise LEED experience Alignment of interests
Developer-Led Turnkey Project Delivery: Integrated Team
Owner holds single contract for Developer, A/E and Construction
Highest Degree of Teamwork
Qualifications based selection; negotiated fee
Subcontractors typically are competitively bid
Enables fast-track construction
GMP early in the design process
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Development Process
Part I- Strategic Development Vision Plan Define scope, program, LEED goals, budget
and schedule Identify, engage and activate consultant and
contractor team, executive working group and stakeholders.
Site analysis and investigation, acquisition plan, survey and title report
Plan of Finance Masterplan and conceptual design Implementation plan Owner approval- GO/ NO-GO
Development Process
Part II- Pre-Development Phase Establish non-profit SPE as a master
ground lessee and borrower Specific physical design to establish
G.M.P Perfect entitlements and agency
approvals Complete financing and site acquisiton Mobilization
Development Process
Part III- Construction Phase Services
Owners representative during construction
Manage commissioning and start up Manage project close-out
Part IV- Post Construction Services Asset Management
Los Angeles Unified School District Primary Centers
- Los Angeles, California
Garfield Traub developed 7 primary schools and a recreation center for the Los Angeles Unified School District at a total cost of $64,576,479, averaging $7 million per school
All eight projects were completed by using an innovative development structure that substantially shorten the delivery time for these essential facilities
The district will make progress payments over the course of construction and will own the schools upon completion
This primary school development program enhances the concept of neighborhood schools for economically challenged areas in the center city and helps to foster family involvement
College of Southern NevadaNorthwest Campus- Las Vegas, Nevada
60-acre mixed-use academic urban village.
Ground floor retail and private uses to support classroom and administrative space on upper levels
Tax-exempt lease-purchase financing and design-build project delivery
1.8 million SF of mixed-use space to include Classroom Laboratory space Support Services Faculty Housing Lifestyle Retail Hotel and Conference
Center Training environments
for students
Durham Performing Arts Center with Duke University
Durham, NC $44.3 million, 2,800-seat
performing arts center Public/private partnership
sponsored by the City of Durham with support from Duke University
Capital structure includes COPs financing secured by an installment purchase agreement
City will make annually appropriated payments supported by a portion of Citywide hotel occupancy tax receipts in addition to naming rights revenue and other sources
To be operated by Professional Facilities Management in partnership with Nederlander Producing Company of America, the number one operator/producer of Broadway entertainment
Operator will guarantee a minimum of 100 event performances per year, will take risk of operating deficits and will split annual operating surpluses with the City
Delivery pursuant to GMAX contract
City will own facility at end of financing term
New York State DOT Region 1 HeadquartersSchenectady, NY
Essential $21M, 125,000 SF facility for State
Part of City revitalization program Delivery method streamlined public
procurement process while still taking advantage of low-cost tax-exempt financing
One tax-exempt variable-rate certificate was placed with one investor (initial rate of 2.35% at funding)
Annual appropriation from State for rent
Garfield Traub Development served as developer
Design-build delivery pursuant to GMAX contract
Delivered on time and under budget State will own facility at end of lease
term
Hotel and Conference Center at Texas Tech University
Lubbock, Texas
$66.2 M first class, full-service hotel conference center
Public/Private Partnership with the City of Lubbock
Adjacent to Texas Tech University/ Jones Stadium
Exclusive agreement with Texas Tech Hospitality Program (RHIM) for laboratory experience and intern program 304 rooms 236,000 SF excluding parking 3-meal restaurant and
adjacent bar Fitness center and outdoor
pool 24-hour business center 17,250 net SF for function
space
Washoe County Public Safety Training Facility
Reno, Nevada
Essential $17M Facility for County County needed existing funds for flood
control County needed ability to occupy and
control space without incurring additional debt
Creative turnkey approach allowed County to keep control of the facility under lease-purchase delivery
Funded through non-recourse lease-revenue bonds
Rent payments are offset to the extent that space is leased to other municipal entities with space needs
Project was delivered ahead of schedule and under budget by Garfield Traub Development
100% of budget savings were returned to County to purchase additional burn props
County will own facility at end of lease term
Master Developer Turnkey Delivery Summary
TAX EXEMPT Owner controls project through tax-exempt entity
Interest cost 35% lower than conventional financing
FEE ONLY developer
NO sales or property tax
Open book/ GMAX contract/design-build process
School District receives beneficial ownership of project from day one and NO BUYOUT at end
Developer provides single source of responsibility
Fastest start and delivery - no bridging documents phase required
Enabling Legislation Overview
Background Article IX, Section 11 of the New Mexico
Constitution New Mexico Supreme Court decision:
Montaño v. Gaboldon, 108 N.M. 94, 76 P.2d 1328 (1989)
November 2006 Amendment to Article IX, Section 11 of the New Mexico Constitution
2007 Legislature enacts the Public School Lease Purchase Act, Sections 22-26A-1 through 22-26A-20 NMSA 1978
Enabling Legislation Overview
Public School Lease Purchase Act Lease Purchase Arrangements
Definition of a lease purchase arrangement Mandatory and permissive lease purchase
arrangement terms Sources of repayment for lease purchase
arrangements Required local school board actions
Enabling Legislation Overview
Public School Capital Outlay Council Assistance
Lease purchase payment grant assistance Purchases of privately owned school facilities
by public school districts
Contact Information
Swisher Garfield Traub DevelopmentStephen Swisher, AIA
2821 W. Horizon Ridge ParkwaySuite 221
Henderson, NV 89052702-241-8352
702-227-7191 [email protected]
Brownstein/Hyatt/Farber/SchreckJill K. Sweeney
201 Third Street NWSuite 1700
Albuquerque, New Mexico 87102-4386505-244-0770
505-244-9266 [email protected]