Tenant Agency: US Attorneys (USAO)
Client: Building Owner
The General Services Administration (GSA) issued an advertisement for a new lease for a USAO office in Tennessee. The lease requirements for the USAO office were very complex, with extensive security provisions that made a new construction project the most feasible lease option in the market. GLA was engaged to represent the Client on both the lease transaction and provide project management services for the design and build-out of the space after the lease was signed. GLA worked with the Client to present a very detailed offer that would allow for the Client to build a multi-tenant building with the USAO as the anchor tenant. After extensive negotiations, the GSA awarded the new USAO lease to the Client.
During the Design Phase of the project, the USAO determined that it no longer needed to have an office in this particular market, and the GSA notified the Client that it intended to cancel the lease. The GSA asked the Client to provide a lease buyout figure to pay to the Client as compensation for the canceled lease. The Client hired GLA to assist in the development of the lease buyout number and the lease buyout negotiations.
GLA has worked on several GSA lease buyouts in the past and, as a result, has established procedures to ensure that its clients are protected from lease cancellations and lease buyouts that can occur on government real estate lease projects. This protection is provided through the language that GLA works with clients to incorporate into the lease offer document for new leases and lease renewal projects. Also, as part of the GLA lease process our clients have very easy access to all project costs for the entire project cycle and lease term which makes it relatively straightforward to calculate an appropriate lease buyout figure at any given time.
The lease document buyout language and ready availability of the project costs allowed for a very quick start to negotiating the lease buyout. The GSA and the Client negotiated the business points of the lease buyout as well as the value of both the lease and the work the Client had done up to the date on which the GSA requested the lease buyout. As a result of GLA efforts, the GSA and the Client were able to come to what both parties felt was a fair and reasonable lease buyout agreement.
Government Lease Advisors, Inc.