NXT 50_RFP_BHFS_5.29.19_Link
50 Response for B.3. TEAM SPECIALISTS DETAILS
SPECIAL FORCES MAKESADIFFERENCE
Hannah Diehl
DenverCBD,Colorado OfficeQ12019 MARKETBEAT
Project Management
Research
Vacancy andRentalRates Denver’s Central Business District (CBD) recorded a 10 basis-point (bps)decrease indirectvacancy to start theyear,down to 16.2% at the endof thefirstquarter2019.Overallvacancy followed suit, recording a 20 bps decrease quarter-over-quarter, to 18.0%. This decrease in vacancy is largelydue to theuptownmicro-market recordinga 120bps decrease in overall vacancy from the fourth quarter 2018 to the first quarter2019, to 16.3%, largely impactedbyWeWorkoccupying 117,000 square feet (sf) atWellsFargoCenter. Direct average gross rental rates increased 2.9% quarter-over-quarter, closing out the first quarter 2019 at $36.79 per square foot (psf). This increasewas largely attributed to the delivery of the PrismBuilding as well as the increase in operating expenses and taxes that continues to driveupoccupancy costs.Overallgross rental rates alsogrewquarter- over-quarter, increasing2.3% to$36.71psfat theendof thefirstquarter 2019. Class A and B product both recorded increases in overall gross rental rates, increasing 1.7% ($40.39 psf) and 3.6% ($31.49 psf), respectively, from the fourthquarter2018 to thefirstquarter2019. The Lower Downtown (LoDo)/Central Platte Valley (CPV) micro-market continues to command the highest rates in the CBD andmetro-wide, ending the first quarter 2019 at $46.01 psf on a direct basis. This is largely due to the lack of available space throughout the LoDo/CPV micro-marketwith a 7.8% direct availability rate at the end of the first quarter 2019. LeasingActivity The CBD recorded just shy of 536,000 square feet (sf) of leasing activity during the first quarter 2019, down from the approximately 674,000 sf leasedduring the fourthquarter 2018.The largest lease for the quarterwas Sunrun’s roughly 95,000 sf lease, as theymove from ParkCentral toManvillePlaza.WeWork continues to lease largeblocks of space, leasing another 61,000 sf inCivicCenter Plaza,whichmarks their seventh location in theCBD.Net absorption remainedpositive for theninthconsecutivequarter,withover 166,000sfabsorbedduring the firstquarter 2019. Construction Onebuilding,ThePrism,deliveredapproximately95,000 sfof rentable officeproduct to theMidtownmicro-market,whichwas 25%preleased atdelivery.Currently, theCBDhas justover 1.0million square feet (msf) of speculative office development under construction and is currently 0%preleased.Thispreleasingpercentage is expected to rise,with86% of the product currently under construction expected to deliver after 2019. These buildings should continue to provide strong preleasing at delivery, if thesuccessofnewconstructionduring thisexpansionperiod continues. Outlook 2019 is set to be another strong year for Denver’s CBD. Absorption should remainpositive throughout the remainderof 2019 aspreviously leased space is occupied.As these occupiersmove-in, vacancy should continue to decrease. Rental rate growth will continue to bemodest with growing occupancy costs and the addition of new product, the catalysts behind these increases. The CBD’s lack of large available blocks of space will continue to hinder the market, with only two 100,000 sfblocksavailable inexistingproductcurrentlyon themarket. Withpotential changing regulationswithin theoil andgas industry and Initiative 300, the CBD’s office growth could be halted. All eyes will continue to be on these legislative topics andwhat comes to fruition, but thosepotentialheadwindscould impact the futureofDenver’sCBD officemarket. DENVEROFFICE OverallNetAbsortion/OverallAskingRent 4-QTRTRAILINGAVERAGE Market Indicators (Overall,AllClasses) Q118 Q119 OverallVacancy 16.3% 15.4% NtAbsorption 108k 600k UnderConstruction 2.2M 1.8M AverageOverallAskingRen $27.41 $28.49 Economic Indicators Q118 DenverEmployment 1.49M DenverUnemployment 2.9% U.S.Unemployment 4.1%
DENVEROFFICE
Economic Indicators
12-Month Forecast
Q1 18
Q1 19
DenverEmployment
1.49M
1.51M
DenverUnemployment
2.9%
3.6%
U.S.Unemployment
4.1%
3.8%
Market Indicators (CBD,AllClasses)
Erik Petersen
12-Month Forecast
Q1 18
Q1 19
OverallVacancy
17.6%
18.0%
Mike Coppola Mike will coordinate all research activity for Brownstein including Mark-to-Market, Market Conditions monitoring and other market monitoring techniques designed to alert our professionals and clients to potential opportunities.
OverallNetAbsorption
197k
166k
UnderConstruction
872k
1.0M
$34.42
$36.71
OverallAverageAskingRent
CherryCreek,Colorado OfficeQ12019 MARKETBEAT
Denver, Colorado OfficeQ12019 MARKETBEAT
DIRECTRENTALRATESVS.VACANCYRATES
$28.00 $29.00 $30.00 $31.00 $32.00 $33.00 $34.00 $35.00 $36.00 $37.00 $38.00 Vacancy andRentalRates TheCherryCreekmicro-marketdirect vacancy rate continued to contract for the fourth consecutivequarter,decreasing60basis-points (bps) to 12.5%on adirectbasis at the endof thefirstquarter 2019. This decrease is largelydue toClassAproduct,whichdecreased 130bps quarter-over-quarter to 12.9%. Overall vacancy closedout thefirst quarter 2019 at 13.6%, representing a50bpsdecrease from anoverall vacancyof 14.1%,onequarter ago. Directgross rental ratesdecreasedquarter-over-quarter,down 2.9% to $35.26per square foot (psf). Thisdecrease is largely attributed to the lackofhigh-quality space that is available throughout themicro-market. Evenwith thisquarter-over-quarterdecrease, rental rategrowthhas beenmoderate year-over-year, increasing 2.8% fromwhendirectgross rental rateswere$34.29psf. This year-over-yeargrowthhasbeen largely impactedbyClassAproduct,whichhas increased approximately 4.9%, to$37.70psf at the endof thefirstquarter 2019. LeasingActivity SESDenv r,Colorado OfficeQ12019 MARKETBEAT Leasing activitywas less robust from theover 102,000 square feet (sf) leasedduring the fourthquarter 2018,with just shyof65,000 sf leased during thefirstquarter 2019.Averagedeal sizewasdown compared to allof 2018,withfirstquarter 2019new leases averaging3,100 sf,
18.0%
Leading our PM team Erik will oversee all PM work, building assessment, construction and inspections.
16.0%
12-Month Forecast
Q1 19
DENVEROFFICE
14.0%
Q1 18
1.51M
12.0%
Economic Indicators
1.49M
3.6%
10.0%
2.9%
3.8%
DenverEmployment
8.0%
EconomicOverview Denver’s unemployment rate recorded a 70 basis-point (bps) increase quarter-over-quarter, up to 3.6% at the end of the firstquarter2019.Evenwith thisuptick, theDenvermetro area remains 20 bps below the national average of 3.8%. Industry diversificationcontinues todriveDenver’s robusteconomyand fuel the impressive growth that is displayed throughout the Denver metro area. Potential headwinds could arise, as new legislativemeasurescouldslowdowntheregion’srobustgrowth. For now, the Denver economy will build off its momentum exhibited in2018,which should lead toanother impressiveyear in2019. MarketOverview Overall vacancy recorded a slight uptick during the first quarter 2019, increasing 20bps to 15.4%.Evenwith this uptick quarter-over-quarter, overall vacancy has decreased 90 bps year-over-year from 16.3% at the end of the first quarter 2018. Directvacancyalso recordedamarginal increase from theend of the fourth quarter 2018 to the end of the first quarter 2019, increasing 10bps to 14.0%.Thisslight increase indirectvacancy is partially attributed to the addition of new construction, as well as the contraction of companies around themetro-area. Vacancyshouldcontract throughout the restof2019,as tenants continue to occupy previously leased space,with the Central BusinessDistrict (CBD)being thedriving forceas itcontinues to be theepicenterofactivityaround themetroarea.
4.1%
DenverUnemployment
6.0%
12-Month Forecast
Q119
Q12015
Q12016
Q12017
Q12018
Q12019
U.S.Unemployment
12-Month Forecast
Q1 19
DirectGrossRentalRate
DirectVacancy
1.51M
Q1 18
13.6%
Market Indicators (CherryCreek,AllClasses)
3.6%
12.5%
87k
OVERALLLEASINGACTIVITYANDNETABSORPTION
3.8%
-10k
55k
Vacancy
124k
- 100 200 300 400 500 600 700 800
$36.41
699
NetAbsorption (sf)
698
$35.45
UnderConstruction (sf)
Noel Kane
526 compared to the3,700 sf average throughout 2018. Evenwith the slow leasingquarter,net absorptionbouncedbackquarter-over-quarterwith justnorthof+87,000 sf absorbedduring thefirstquarter 2019, representing a large increase from the approximately -5,000 sf absorbed during the fourthquarter 2018. The increase in absorption canbe attributed to thedeliveryofFinancialHouseduring thefirstquarter 2019,whichdelivered 100%preleased. Construction Onebuildingdelivered to theCherryCreekmicro-marketduring thefirst quarter 2019.The aforementionedFinancialHouse, located at 205 DetroitStreet,delivered approximately69,000 sfofofficeproduct to the vibrantCherryCreekNorthneighborhood.Financialhousehas leases signedwithUBS,BowRiverCapital andOceansideTenHoldings. It alsohappens to containoneof thefirstWeWork locationsoutsideof theurban core. Currently, the loneofficedevelopmentunder construction is the66,000 sf at 260North JosephineStreet. This development is slated todeliver justunder55,000 sfofofficeproduct, and 11,000 sfofgroundfloor retail,during the thirdquarter 2019 and is currently 70%preleased. Outlook Q1 18 Q1 19 12-Month Forecast 17.1% 16.7% -1k -177k 552k 363k Q1 18 Q1 19 12-Month Forecast 1.49M 1.51M 2.9% 3.6% 4.1% 3.8% 111 Q12015 SquareFeet (Thousands)
536
AverageAskingRent*
157 Vacancy andRentalRates TheSoutheastSuburban (SES) submarket recorded a 100basis-point (bps) increase in vacancy during the first quarter 2019, to 14.9% on a directbasis.Likedirect,overallvacancyalso recordeda large increase, increasing 150 bps to 16.7% at the end of the first quarter 2019. Vacancy continues tobedrivenby theMeridianmicro-market.At the end of the first quarter 2019, overall vacancy within the Meridian micro-market was 26.2%, the highest overall vacancy rate for any micro-market across theDenvermetro area.Another indicatorworth noting is the availability rate. This rate,which excludes leased vacant space, bt includes all vacant and occupied space that is being marketed for lease, recordeda60bpsdecrease to20.4%onanoverall basisduringfirstquarter 2019 for theSES submarket. Direct average gross rental rates grew moderately, increasing approximately 1.6% quarter-over-quarter to $26.06 per square foot (psf)during th firstquarter 2019.Directgross rental rates continued to stabilize,growing 1.5%year-over-year fromwhendirectgross rental rateswere $25.67 psf, one year ago. This is a significantly slower, but more sustaiable, pace compared to the 4.8% average growth exhibited inthe prior three years.Overall gross rental rates followed suit, growing roughly 1.8% quarter-over-quarter to $25.78 psf at the endof thefi stquarter 2019 . LeasingActivity Leasing activity bounced back from a slow fourth quarter 2018,with approximatly579,000 square feet (sf) leasedduring thefirstquarter 2019. The largest lease for the quarter was Cochlear’s 161,000 sf sublease at ParkRidge Six, backfilling the fully vacant building. Two other notabl leases for the quarterwere: SierraNevada’s 41,000 sf renewal at9800S.MeridianBoulevard andYesCommunities’32,000 sfnew lease at50FiftyDTC,whichwill relocate from 1900 16th in the Central Business District. Coming off one of the strongest years for absorption ever in 2018, net absorption started out 2019 with approximately -177,000 sf of net absorption. This decrease is largely attributed toClassB product,which accounted for -125,000 sf (71%) ofnet absorption,during thefirstquarter 2019. Construction No new buildings delivered in the SES submarket during the first quarter 2019 and there is only one project under construction. The roughly 382,000 sf 6900 Layton is set to deliver mid-2020 and is currently49%preleased toNewmontMining.Momentumat thenewly constructed 5050 S. Syracuse project has ramped up, as 75,000 sf was leased during the first quarter 2019 after delivering fully vacant during the fourthquarter 2018. Outlook The SES submarket should bounce back from a slow start, with strengthening fundamentals as the year progresses. Absorption should increase,as tenantsoccupypreviously leased space,whichwill in turn contract vacancy rates.Rental rate growthwill continue to be moderate,withgrowingoccupancycostscontinuing tobe thecatalyst behind gross rate growth. The flight from Class B to A product will continue, as occupiers view their real estate as a key driver in the recruitment and retentionof employeeswithin theSES submarket. 378 73 197 166 Q12016 Q12017 Q12018 Q12019 LeasingActivity NetAbsorption
12-Month Forecast
DENVEROFFICE
25.0%
*Submarketboundarieswere re-assessedbeforeQ1 2018
Economic Inicators
20.0%
OVERALLRENTALRATESVS.VACANCYRATES
15.0%
$29.00
$28.50
10.0%
DenverEmployment
$28.00
DenverUnemployment
5.0%
$27.50
$27.00
U.S.Unemployment
0.0%
$26.50
Q12019
$26.00
Q12018
2.0
(we did notbreak out theNWC from theNW until2015) Q12017
Market Indicators(SES,AllClasses)
$25.50
OverallVacancy
Q12016
$25.00
Q12015
1.5
OverallGrossRentalRate
1.0
OverallVacancy
194
205
LEASINGACTIVITYANDABSORPTIONBYCLASS 271
0.5
NetAbsorption
300
UnderConstruction
250
0.0 SF (Millions)
103
200
85
TheCherryCreekmicro-market continues toprovide someof the strongestoffice fundamentalsmetro-wide. Vacancywill remain stable, asmove-outsoccur,butwillbehelped from the strengthofnew construction,which continues to leaseupquickly. Rental rateswill continue to climbover thenext threequarters, asnew construction delivers, andoccupancy costs continue to increasemarketwide.Tenants haveproved awillingness topay apremium tobe located in the affluent NorthCherryCreekneighborhood, allowing for landlords to increase rates across all classes,due to thehighdemand exhibited from occupiers. With thispent-updemand forhigh-endClassAoffice products, itwould come asno surprise to seemoreproposedprojects come to fruition, as the appetite fornewproduct is clearbasedon the highpreleasing stats seen innewdevelopments. Overall, theCherry Creekmicro-market should continue to remainhealthy, albeitgrowthwill bemoremoderate than the rapidgrowth exhibited inprior years. $25.36 $25.78 10.0% 12.0% 14.0% 16.0% 18.0%
OverallAverageAskingRent
150
Coming off of a strong 2018, net absorption remainedpositive for theeighthconsecutivequarter,withapproximately600,000 square feet (sf) absorbed through the first quarter 2019. This represented a large increase over the 301,000 sf absorbed during the fourth quarter 2018. This healthy absorption is largely due to the addition of new inventory, that delivered collectively 75% preleased, as well asWeWork continuing to occupy previously leased space. Absorption should continue to trend positively throughout the rest of 2019, as companies like Cochlear, Slack Technologies, Amazon andWeWork take occupancy of previously leased large blocks of space.With the influence of tech growth throughout the Denver metro area,netabsorption should remain strong,albeitata less torrid pacewhen compared to the robust absorption that occurred throughout2018.
88
-0.5
(55)
100
(100) (50) - 50
LSAG Team
-1.0
(12)
-93
(142)
2014
Q12019
2015
PreliminaryProjectSchedule AnadarkoGraniteBuilding
Q12018
2016
OverallAbsorption
Q12017
DIRECTRENTALRATESVS.VACANCYRATES
2017
(150)
Q12016
2018 OverallAskingRent,$PSF
NetAbsorption
(200) SquareFeet (Thousands) Q12015
2019
OverallVacancy
LeasingActivity
$27.00
ID TaskName
Duration Start
2019
2020
2021
2022
30.0%
25.0%
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
$26.00
17.0%
20.0%
SUBMARKETSTATSCOMPARISON
1 LargeBuilding,CLIENTAProject -Approximately295,000SF,5Phasesbasedonapproximately63,000ofSwingSpace 2 GeneralContractor -SelectAppropriateShortListofGCs,PrepareRFP -RequestingCostPlus /GMPProposal, InterviewandSelect 4wks
870days Mon1/28/19
15.0%
16.0%
$25.00
5.0% 10.0%
$40.00 $45.00
Mon1/28/19
15.0%
$24.00
$30.00 $35.00
0.0%
3
Programing,Stacking andBlockingPlans
30days Mon1/28/19
14.0%
$20.00 $25.00
8.0%
$23.00
HistoricalAverage:13.83%
13.0%
$10.00 $15.00
4 CLIENTAFloors1 - 14ProgrammingandTestFitReview,SpacePlanningEntireProjectAll14Floors295,000SF,BldgDepartment Mtg 6wks
Mon1/28/19
6.0%
$22.00
$5.00
4.0%
12.0%
$0.00
$21.00
5 6 7 8 9
SwingSpace
50days Mon1/28/19
2.0%
11.0%
Leasing activity recorded a slight increase over the 2.0million square feet (msf) leasedduring the fourthquarter2018with2.1 msf of new leasing activity throughout theDenvermetro area. Themost notable lease that occurred during the first quarter 2019,wasCochlear’s 161,000sfsubleaseatParkRidgeSix,which will backfill the entire building and grow Cochlear’s footprint.
DirectVacancy
$20.00
0.0%
Working directly with Sherry Cushman, Hannah and Noel help perform the Brownstein survey and assessment process and assist in developing and delivering strategic visioning and comparison data to Brownstein.
SwingSpace -ConfirmTemporaryRequirements -AV,Cabling,Security,MiscellaneousFurniture
4wks 6wks
Mon1/28/19 Mon2/25/19
10.0%
DirectAskingRate
Q12015
Q12016
Q12017
Q12018
Q12019
2014
2015
DirectGrossRentalRate
DirectVacancy
Install/Provide/ModifyAnyDeterminedSwingSpaceNeeds
2016
2017
DesignDevelopment,ConstructionDrawing,Permit,Construction PHASEONEFloorsA,B,andC -Design andConstruction
841days Fri3/8/19 225days Fri3/8/19
2018
OVERALLLEASINGACTIVITYANDNETABSORPTION
2019
1,000
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48
798
SchematicDesignPhaseOne -FloorsA,B andC;CostEstimating andClientReview DesignDevelopmentPhaseOne -FloorsA,BandC;CostEstimating andClientReview ConstructionDrawingsPhaseOne -FloorsA,B, andC;CostEstimating andClientReview
3wks 5wks 5wks 8wks 4wks 4wks
Fri3/8/19 Fri3/29/19 Fri5/3/19 Fri6/7/19 Fri6/7/19 Fri7/5/19 Fri8/2/19 Fri1/3/20 Fri6/7/19 Fri7/19/19 Fri9/27/19 Fri12/20/19 Fri1/17/20 Fri2/14/20 Fri3/13/20 Fri8/14/20
800
725
643
605
579
600
484
cushmanwakefield.com I 1
400
PermitPhase 1Drawings
200
62
4
RelocateEmployeesOff ofFloorsA,B,andC to theSwingSpace Demolition, newwall layout,HVAC layout, framing, drywall one side,etc.
0
(200)
-177
SquareFeet (Thousands)
-220
ConstructionPhase 1, includes data cabling, security,AV, soundmasking, furniture installedand tested RelocateEmployeesFromSwingSpaceBack toNewlyConstructedFloorsA,B,andC DESIGNofPHASETWO (D,EandF),PHASETHREE (G,H,and I) andPHASEFOUR (J,K,andL) SchematicDesign -PhasesTwo,Three,andFour;CostEstimatingandClientReview DesignDevelopment -PhasesTwo,Three,andFour;CostEstimating andClientReview ConstructionDrawings -PhasesTwo,ThreeandFour;CostEstimatingandClientReview
22wks
(400)
Q12015
Q12016
Q12017
Q12018
Q22018 1 9
LeasingActivity
NetAbsorption
2wks
cushmanwakefield.com | 1
776days Fri6/7/19
6wks
10wks 12wks
PHASETWOConstructionFloorsD,E, andF
180days Fri12/20/19
PermitPhase 2FloorsD,EandF
12wks
RelocateEmployeesOff ofFloorsD,E,andF to theSwingSpace
4wks 4wks
DemolitionPermit,newwall layout,HVAC layout, framing,drywallone side, etc.
ConstructionPhase 2, includes data cabling, security,AV, soundmasking, furniture installedand tested RelocateEmployeesFromSwingSpaceBack toNewlyConstructedFloorsD,E, andF
22wks
2wks
PHASETHREEConstructionFloorsG,H,and I
180days Mon8/3/20
PermitPhase 3FloorsG,H and I
12wks
Mon8/3/20 Fri8/28/20 Fri9/25/20
RelocateEmployeesOff ofFloorsG,H,and I to theSwingSpace DemolitionPermit,newwall layout,HVAC layout, framing,drywallone side
4wks 4wks
ConstructionPhase 3, includes data cabling, security,AV, soundmasking, furniture installedand tested RelocateEmployeesFromSwingSpaceBack toNewlyConstructedFloorsG,H, and I
22wks
Mon10/26/20 Mon3/29/21
2wks
PHASEFOURConstructionFloors J,K, andL
180days Mon3/15/21
PermitPhase 4FloorsD,EandF
12wks
Mon3/15/21 Mon4/12/21 Mon5/10/21 Mon6/7/21 Mon11/8/21 Fri12/20/19 Fri1/17/20 Fri2/21/20 Mon11/1/21 Mon11/22/21 Mon12/20/21 Mon1/24/22 Mon5/16/22
RelocateEmployeesOff ofFloorsD,E,andF to theSwingSpace
4wks 4wks
DemolitionPermit,newwall layout,HVAC layout, framing,drywallone side, etc.
ConstructionPhase 4, includes data cabling, security,AV, soundmasking, furniture installedand tested RelocateEmployeesFromSwingSpaceBack toNewlyConstructedFloors J,K,andL
22wks
2wks
PHASEFIVEConstructionFloorsM andN
636days Fri12/20/19
Global Services
SchematicDesignFloorsMandN;CostEstimatingandClientReview DesignDevelopmentFloorsM andN;CostEstimatingandClientReview ConstructionDrawingsFloorsM andN;CostEstimatingandClientReview
4wks 5wks 6wks
PermitPhase 5FloorsM&N
12wks
RelocateEmployeesOff ofFloorsM&N
4wks 4wks
DemolitionPermit,newwall layout,HVAC layout, framing,drywallone side, etc.
ConstructionPhase 4, includes data cabling, security,AV, soundmasking, furniture installedand tested
16wks
RelocateEmployeesFromSwingSpaceBack toNewlyConstructedFloorsM&N
2wks
COSTAR
Task Milestone Summary
RolledUpTask RolledUpMilestone RolledUpProgress
Split ExternalTasks ProjectSummary
GroupBySummary InactiveTask InactiveMilestone
InactiveMilestone InactiveSummary ManualTask
Duration-only ManualSummaryRollup ManualSummary
Start-only Finish-only ExternalTasks
ExternalMilestone Progress Deadline
Cushman&Wakefield Fri 2/1/19
Fri2/1/19
Preliminary&Confidential
Cushman&Wakefield ofColorado, Inc.
FINANCIAL ANALYSIS
Martin Woodrow Martin leads C&W’s EOS group and just happens to be located in Denver. Martin is a tremendous asset for portfolio leaders to deliver “best practices” from major occupiers to Brownstein. C&W helped Akerman become as tech oriented in their portfolio as our biggest tech clients.
Financial Services Olan Young
V.2.0 1/22/18
BROWNSTEINBASECASEandPOTENTIALOCCUPANCYALTERNATIVES -Denver
Baseline /Basecase BASELINE -Current
May'18 -May'23 (61months)
111.3KSFat 41017thStreetThroughMay'23
Lease Audit Machel Roller Known for tenacious advocacy and accounting pedigree, Machel will perform all the Operating Expense and Tax audits for Brownstein.
BASECASE -Current+Expand18th LongTermOccupancyAlternatives ALT1:ExpandandStayat41017th
ExpandOnto18thFloorandStay InExistingSpace (130.2KSF)at41017thThroughExpiration -May'23
May'18 -Apr'33 (180months)
ExpandandStay LongTermat41017th (Take18thFloor,ExtendOtherSpace throughApr'33)
ALT2:Relocate toBlock162atExpiration (May'23) ALT3:Terminate41017th,Relocate (WFC)
ExpandandStayUntilExpiration (May'23)ThenRelocate toBlock162
Terminate41017thSpaceatApr'19OptionDateThenRelocate toExistingOption (WFCas sample)
AnalysisPeriod (May'18 -Apr'33)
180mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos 12mos FYE 4/30/19 4/30/20 4/30/21 4/30/22 4/30/23 4/30/24 4/30/25 4/30/26 4/30/27 4/30/28 4/30/29 4/30/30 4/30/31 4/30/32 4/30/33
$'s inMillions
Annuity Equivalent 1
TotalP-TCASHExpense
TotalNOM$
TotalNPV$
Baseline /Basecase
May'18 -May'23 (61months) 111,307SF
BASELINE -Current
$17.4 $20.8
$14.5 $17.4
$3.3 $3.9
$3.3 $3.1 $3.5 $3.6 $3.7 $0.3 $3.9 $3.8 $4.1 $4.3 $4.4 $0.4
BASECASE -Current+Expand18th
130,163SF
LongTermOccupancyAlternatives
May'18 -Apr'33 (180months)
ALT1:ExpandandStayat41017th
$80.2 $92.4 $84.0
$48.0 $55.7 $52.8
$4.9 $5.7 $5.4
$4.4 $4.5 $4.7 $4.8 $4.9 $5.1 $5.2 $5.3 $5.5 $5.6 $5.7 $5.9 $6.0 $6.2 $6.3 $3.9 $3.8 $4.1 $5.2 $6.3 $15.1 $5.4 $5.5 $5.7 $5.8 $6.0 $6.2 $6.3 $6.5 $6.7 $7.0 $9.0 $4.4 $4.6 $4.7 $4.8 $4.9 $5.1 $5.2 $5.4 $5.5 $5.6 $5.8 $6.0 $6.1
130,163SF 105,000SF 120,000SF
ALT2:Relocate toBlock162atExpiration (May'23) ALT3:Terminate41017th,Relocate (WFC)
Capital /1-TimeExpense Items: Netofany LLProvidedTI$s 2
TotalNOM$
Baseline /Basecase
May'18 -May'23 (61months) 111,307SF
BASELINE -Current
$0.0 $0.0
$0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
BASECASE -Current+Expand18th
130,163SF
LongTermOccupancyAlternatives
May'18 -Apr'33 (180months)
ALT1:ExpandandStayat41017th $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $9.5 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $3.7 $9.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $12.7 [1]TotalNPVenables comparisonofequivalent length investments.Annuityequivalent converts totalNPV intoa seriesofannual cash flows therebyprovidingaway to compareprojects / scenarios ofunequal life. [2]Capitaland1-Time Items=Tenant ImprovementBuildoutPLUSMoveCostsPLUSTerminationFee (ifapplicable) LESSany LandlordProvidedTenant ImprovementAllowance $0.0 $9.5 ALT2:Relocate toBlock162atExpiration (May'23) ALT3:Terminate41017th,Relocate (WFC) 130,163SF 105,000SF 120,000SF
One of C&W’s top financial analysts, Olan has completed multiple analysis projects for Brownstein and is very familiar with the firm and your preferences for analysis.
COSTAR
FINANCIAL ANALYSIS
BrownsteinHyattFarberSchreck | Cushman&Wakefield 17
126mos term* <-132mos term* -> 165KSF
BROWNSTEINBASECASEandPOTENTIALOCCUPANCYALTERNATIVES -Denver $ inMillions ($'s inmillions)
$60.0
Cash
$55.7
TotalScenarioPre-TaxNPVCost ScenarioCapitaland1-TimeExpense -NetofTI [1]
$52.8
$48.0
AnnuityEquivalent [2]
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$45.0
$30.0
$17.4
$14.5
$15.0
$12.7
$9.5
$5.7
$5.4
$4.9
$3.9
$3.3
$0.0
$0.0
$0.0
$0.0
BASELINE -Current
BASECASE -Current+Expand18th
ALT1:ExpandandStayat41017th
ALT2:Relocate toBlock162atExpiration (May'23)
ALT3:Terminate41017th,Relocate (WFC)
<-------------------------------~5YearPeriod (May'18-May'23)----------------------------------->
<---------------------------------------------------------------15YearPeriod (May'18-Apr'33)--------------------------------------------------------->
V1.0_1-18-18
[1]Capitaland1-Time Items=Tenant ImprovementBuildoutPLUSMoveCostsPLUSTerminationFee (if applicable) LESSanyLandlordProvidedTenant ImprovementAllowance [2]TotalNPVenables comparisonof equivalent length investments.Annuityequivalent converts totalNPV intoa series of annual cash flows therebyproviding away to compareprojects / scenarios of unequal life.
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Cushman & Wakefield | Brownstein Hyatt Farber Schreck
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