Case Studies

The Sudler Company

Sudler

CHALLENGE/OPPORTUNITY

In the fall of 2009, TSC Realty Services, LLC was hired by the New Jersey based Sudler Companies to lease its Landover Maryland properties, totaling 150,000sf. These properties include:

  • 101 Pennsy Drive, Landover Maryland  – 
A 103,000 square foot industrial flex facility located in Prince Georges County, Maryland. An industrial/flex building fully occupied by the GSA with one year remaining. The GSA had occupied this property for 20 years and had indicated that the property was no longer fully useful.
  • 3333 Pennsy Drive, Landover, Maryland – 
A 37,000 sf office/warehouse in Prince Georges County, Maryland that was vacated in poor condition in 2009.

SOLUTION

Beginning in the fall of 2010, TSC worked in concert with Sudler’s asset management and property management teams to survey the current condition of both properties. The purpose of our collaboration was to develop a scope of improvements that would support marketing/leasing efforts.

Simultaneously, TSC developed its marketing plan which included a focused effort to retain the GSA. By the Fall of 2011, 3333 Pennsy Drive was fully leased to Hensel Phelps Construction and The GSA had reversed its position, identified alternative uses for this metro served property and renewed its lkease for a 10 year period.

TSC VALUE-ADD

  • GSA : 103,000 square feet/ 10 years
  • Hensel Phelps Construction: 37,000 sf/7 years

Prudential

CHALLENGE/OPPORTUNITY

TSC Realty Services, LLC represents Prudential Real Estate Investors as the exclusive marketing and leasing agent of the Gateway 270 Business Park in Maryland’s I-270 Corridor. The project (which was developed in a joint venture including Prudential, TSC Realty Services and The John Akridge Company) originally consisted of 250,000 sf of office, warehouse and flex space. The property has been 100% leased since its completion in 2001. In 2010, the largest tenant, Thales Communication, Inc. with its 114,000 sf lease expiring in May 2011 required (in order to remain in the project)an additional 75,000 square feet of expansion space within an eighteen month period.

SOLUTION

TSC and Prudential in concert with various architects, engineers, construction managers, governmental agencies and legal counsel developed a plan to reposition and expand the complex to serve Thales as a dedicated business campus. As such, Thales would benefit from economic and operational efficiencies resulting from a re-design and consolidation of their Maryland facilities. In accordance with the plan, TSC worked with existing tenants and an adjacent property owner to make expansion space available. In short, our team negotiated early lease terminations with two existing tenants totaling 48,000 sf. In addition and on behalf of Prudential, TSC negotiated the purchase of an adjacent 22,000 square foot building and subsequently negotiated early lease termination with its three occupants.

TSC VALUE-ADD

Ultimately, the re-development process included acquiring an adjacent building, negotiating five early lease terminations, expanding parking area and linking the Thales buildings with walkways, picnic areas and enhanced landscaping areas. The process required coordination and approvals from governmental organizations including MNCPPC and Montgomery County.

Pulmonary Hypertension Association

PHA

CHALLENGE/OPPORTUNITY

The Pulmonary Hypertension Association (PHA) reached out to TSC for assistance in evaluating future space requirements.  PHA was headquartered in a Class B building, on multiple floors and growing despite the economic downturn. PHA was considering the purchase of a downtown Silver Spring office building or leasing an additional suite to accommodate their immediate growth needs, however this would have left their operations divided amongst three non-adjacent spaces.

SOLUTION

TSC worked with PHA to understand their needs and challenges. PHA described an ideal space that would accommodate their immediate need for additional space while giving them room for continued growth.  TSC provided a comprehensive financial model that enabled PHA to assess the costs of ownership vs. leasing, which resulted in a decision to lease more space in their current building.

TSC VALUE-ADD

TSC successfully negotiated a lease restructure on the top floor of PHA’s existing building that provided 42% more space with only a 17.3% increase in the overall rent. Effectively, PHA’s rental rate in 2010 decreased by more than $7.00 per square foot. By securing an economically aggressive deal, PHA was able to meet their growth needs and manage financial risk.. The organization is now enjoying views of downtown Silver Spring in a newly renovated space that has seen an increase in staff productivity and morale.

XIF

XIF

CHALLENGE/OPPORTUNITY

Xif, a leading interactive design and software development firm, occupied an office building just north of Dupont Circle.  With several months remaining on their lease, xif went to market with the real estate advisors at TSC to find a new space that would offer flexibility in the short term at an affordable rate.

SOLUTION

Taking advantage of the high vacancies and reduced rental rates in downtown DC, TSC introduced xif to a number of options including spaces for direct lease and sublease.  After finding a sublease at 1200 New Hampshire Avenue, xif and TSC worked collectively as a team to negotiate the most optimal terms and conditions.

TSC VALUE-ADD

TSC was able to  secure 5 months of free rent (to offset the remaining term left on xif’s lease in Dupont Circle) and a reduced rate of $23 per square foot in a Class A Building.  The software firm is now enjoying views of M Street from their window-lined offices and private balcony.

UPS

UPS

CHALLENGE/OPPORTUNITY

TSC Realty Services, LLC represents UPS Properties in the Washington DC region in the leasing of three of its industrial developments in the major suburban market areas surrounding Washington DC. These properties include:

Landover Distribution Center
A 160,000 square foot industrial facility located in Prince Georges County, Maryland.

Gaither Distribution Center
A 450,000 square foot facility located in Montgomery County, Maryland.

Dulles Distribution Center
A 120,000 square foot facility located in Fairfax County, Virginia.

SOLUTION

TSC worked with UPS to develop a long-term marketing plan to lease these properties in the three distinct markets they are in. TSC gained a clear understanding of UPS Properties’ financial and leasing goals that would ensure success of the effort.

TSC VALUE-ADD

Landover Distribution Center

  • Atlantic Coast Portable Storage/Hilldrup: 94,000 square feet
  • Soccer Dome PGC: 55,000 square feet

Gaither Distribution Center

  • National Institutes of Health: 150,000 square feet
  • Armed Forces Institute of Pathology: 31,000 square feet
  • Global Satcom: 112,000 square feet
  • Hughes Network Systems: 107,500 square feet

Dulles Distribution Center

  • Nutravail Technologies: 60,600 square feet
  • Archive Systems, Inc.: 30,500 square feet

Weatherbug

Weatherbug

CHALLENGE/OPPORTUNITY

WeatherBug, headquartered in Germantown, Maryland, was occupying 45,000 square feet of Class A office space with an excess of 1.5 years remaining on the lease. TSC represented the tenant interests to determine the best strategy to reduce total expenses over the upcoming five years with a detailed analysis of moving expenditures versus the cost of lease renewal.


SOLUTION

TSC worked with WeatherBug to understand their long-term needs and the economic challenges posed by either renewing their current lease or relocating to an alternative location. WeatherBug was provided with a comprehensive market tour of comparable office spaces, alongside several lease restructuring scenario’s potentially available through their current landlord.

TSC VALUE-ADD

Ultimately, through successful negotiations with WeatherBug’s current landlord, TSC initiated a lease restructuring strategy that reprogrammed their current space plan with additional tenant improvement dollars, provided rental abatement incentives and reduced base rent and overall expenses by $8.00 per square-foot. Further, TSC as representative for WeatherBug successfully negotiated with Montgomery County the right to display a sign on the building facing I-270 that had been previously rejected two times.

NAACP

NAACP

CHALLENGE/OPPORTUNITY

After receiving the guidance of a competitive brokerage firm, the NAACP signed a letter of intent to renew their lease at 1156 15th Street NW at a “market rate.”  Expressing the need for a second opinion, the NAACP reached out to the tenant advisory team at TSC Realty Services.


SOLUTION

Upon a thorough review of the NAACP’s current and newly-proposed lease terms, TSC found that the NAACP could restructure the terms of the deal by maintaining their current space with minor tenant improvement dollars and applying the unused improvement allowance as rental abatement.

TSC VALUE-ADD

TSC was able to negotiate an effective rental rate that was $5.00 less than what the competitive brokerage firm had negotiated along with a savings of $10 a square foot less than their current existing rate. The NAACP Washington Bureau is now enjoying a significant cost-savings with upgrades to their suite while reducing their overall costs by 20% a year.

Comstar FCU

Comstar FCU

CHALLENGE/OPPORTUNITY

TSC Realty Services represented both COMSTAR Federal Credit Union and Prudential Real Estate Investors in the sale of 22601 Gateway Center Drive, a 21,800 square-foot office building in Clarksburg, Maryland. Located on the Route 121 interchange of I-270, the Property is positioned adjacent to Gateway 270 Business Center, a 300,000 square-foot office/R&D campus owned by Prudential. COMSTAR purchased the Property in 1994 which was originally developed as a built-to-suit for Metropolitan Insurance.  In 2010, however, with its rapid growth trajectory, the company sought to dispose of the Property and identify new headquarters.

SOLUTION

TSC successfully sold 22601 Gateway Center drive for $3,597,000 or $165 per square foot to Prudential as a means of incorporating the property into its neighboring Gateway 270 Business Center.  Advised  by TSC, this strategic purchase allowed Prudential to fulfill the needs of its largest Gateway 270 tenant, Thales Communications, which required separate conference/executive center space which was not currently available within the business park.

TSC VALUE-ADD

Advising both buyer and seller, TSC assisted COMSTAR and Prudential to maximize their long-term interests. Upon the sale of the Property, TSC was able to identify and relocate COMSTAR FCU to its new headquarters building, more strategically located for its evolving business plan and customer base in Frederick, Maryland. At the same time, through this acquisition,  Prudential gained control of a key, contiguous parcel while meeting the needs of its largest tenant.