Federal Lessor Advisory Group
701 E. Chelton Ave.
A large U.S. Institutional investor purchased a portfolio of nine (9) buildings, fully leased to the Federal Government across seven states, most of which below 30,000 SF.
Being of relatively small size for the Federal Government, these leases oftentimes get very little attention from GSA or the tenant agency ahead of their lease expiration dates.
This leaves owners with very little time to react to GSA and without the ability to provide any input into the renewal. These types of scenarios lead to landlords ending up believing they are at the mercy of the Government’s dictated terms.
- CBRE FLAG was engaged on a multi-state portfolio of government leased buildings to implement a strategy of early engagement on renewals and the submitting of Unsolicited Proposals to the Government to monetize leases entering soft term
- Early engagement in this case is 2 to 3 years ahead of time and the concept of monetization of soft terms is completely in line with GSA’s stated strategic objectives
- CBRE FLAG engaged with GSA for the SSA lease on Chelten Ave in Philadelphia 26 months ahead of the 15,000 SF lease expiration date
CBRE FLAG was successful in convincing GSA to revise their initial strategy of a 40% space reduction at the renewal to agreeing to renew the entire building for 15 years with no change in square footage in exchange for a reduced rental rate, along with a certain amount of relatively minor improvements to the base building, and the in-place tenant improvements