1 Challenge- Chemical Research & Licensing (CRL) required an investment grade distribution facility
at below market rates in proximity to its plant along the Houston Ship Channel. The market
for space in the size range contemplated was tight.
- Strategy
- Identify buildings in the appropriate submarket that provide both an economically viable
deal and a sufficient quality to protect millions of dollars of inventory. Specifically,
leasesquarefeet.com leveraged what differentiates real estate deal making at properties
owned by Real Estate Investment Trust, Pension Funds and individuals to drill down to a
handful of appropriate facilities.
- Result
- CRL leased space from a publicly traded REIT seeking to reduce vacancy and increase
immediate “funds from operations” (a REIT valuation. metric) at the expense
of future property valuation the rate achieved was 20% below rates quoted at comparable
buildings in the submarket.
2 Challenge- Mid America Overseas (MAO) received a proposal from its landlord to renew its 13,000
square foot lease at a rate of 35% higher than the rate negotiated in its initial lease
term.
- Strategy
- Capitalize on the fact that MAO's building was part of a portfolio to be sold that
could ill afford to lose tenants. MAO reviewed and the landlord was made aware of several
alternatives that satisfied MAO's requirement creating uncertainty with the building's
owner.
- Result
- Landlord capitulated. MAO renewed its lease at rates 15% below its initial term's rental
rate, secured tenant improvements that were not previously available and capped its
annual operating expense growth exposure.
3 Challenge- Exel Transportation sought to relocate to increase the profitability and efficiency of
its operations. Its facility had too few dock doors and was too far from transportation
arteries.
- Strategy
- Canvas the market to identify all buildings, not just standard distribution facilities,
with minimal bay depths to support the maximum number of dock high doors yet at rates that
would not wipe out the resulting saving from a more efficient operation.
- Result
- Leasesquarefeet.com located a 23,000 square feet dock high, rear load building with
twelve (12) dock doors, immediate proximity to Houston's freeway system and negotiated
a competitive rental rate satisfying all of Exel's requirements.
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