POTOMAC YARD
POTOMAC YARD BUILDING DEVELOPMENT
For Educational Use Only
1
REVIEW • • • • •
Lazard Freres Purchased in 1996 (Land Packaging) Master Plans approved in 1999(Alexandria) 2000(Arlington) Crescent Resources Purchased in 2001 (Land Development) Land Development for Crescent finished in 2005 Building Development on Arlington Land Bay A begins in 2003 (Design and Site Plan Approval Process)
For Educational Use Only
2
POTOMAC YARD ONE & TWO: BUILDING DESIGN AND PERMITS • 46 Requirements from the Phased Development Site Plan (PDSP) and Urban Design Guidelines • 71 Requirements from the 4.1 Site Plan approval
For Educational Use Only
3
PRE-LEASING TO THE GOVERNMENT SERVICES ADMINISTRATION Crescent was preparing to build a 654,000 square foot, two-tower building on Arlington Land Bay A, but Crescent: • Successfully responded to a GSA Request for Proposals (RFP) for 405,000 square foot, 10-year lease for the U.S. Environmental Protection Agency with two unique provisions: 1. Building must be Silver LEED-NC Certified upon Completion. Failure to meet the LEED Silver Certification would reduce the gross rent by 10% 2. Building must meet the U.S. Government’s requirement for Level IV Security
For Educational Use Only
4
RESPONDING TO THE GSA PRE-LEASE LEED-NC Silver Requirement: • Assemble of Team of Green Building Experts • Increased the Constructing Budget by $6.00 per square foot • Limited marketing of the remaining available space Level IV Security: • Re-designed 6-level parking structure to restrict parking to one predesignated building • Re-designed building lobbies to accommodate security equipment and personnel, and to restrict public access to designated areas
For Educational Use Only
5
CONSTRUCTION OF THE IMPROVEMENTS • Building Construction Costs : -
Land $ 8.8 million (6.8%) Hard Costs $ 91.2 million (70.6%) Soft Costs$ 29.0 million (22.5%) Total Costs $129.0 million (100%)
• Challenges: • • • • • •
Excavation below sea level On-site concrete batch plant for post tension concrete structure Staging of the precast panel assembly Green Builidng requirements Builidng Commissioning GSA Change Orders (385) For Educational Use Only
6
POTOMAC YARD ONE & TWO: BUILDING CONSTRUCTION PHASES
June 1, 2002 Start
October 20, 2004 Completion
2003 Sept.
2004 2004 2004 June 1 Phase II Starts
Nov. Dec. 4 Phase I Substantial Completion
For Educational Use Only
7
NEIGHBORS IN BUILIDNG DEVELOPMENT • The Builidng Development Process requires cooperation with Neighbors, especially adjacent land uses: • Here are examples of poor neighbor relations: • Pile driving activity during early morning hours woke up guests in the adjacent hotel. • Removal of existing road bed caused flooding in the adjacent underground parking garage. • The adjacent land owner started construction on an apartment building and both projects closed Crystal Drive Road while staging materials. • Re-bar bundle “nicked” a passing Virginia Rail Express Train as it was being lowered onto the building floor by an overhead crane (see next slide).
For Educational Use Only
8
LAND BAY A CONSTRUCTION CRANE AGREEMENT Left: Construction crane swing areas are shown. Note the overlapping of radials and onto adjacent properties,
Right: Cranes are color coded to match radial diagram and show crane placement in the buildings. For Educational Use Only
9
SALE OF ONE & TWO POTOMAC YARD • In September 2005, JP Morgan entered a purchase agreement for One and Two Potomac Yard for $213.5 Million with the following funding provisions: • Funding at Shell Completion: $100,000,000 • Funding at GSA Lease Commencement: 95,500,000 • Funding at LEED-NC Silver Certification: 18,000,000*
• At GSA Lease Commencement, JP Morgan took over the role of Builidng Operations Developer (Stage 5) *Achieved LEED-NC Gold Certification
For Educational Use Only
10
WRAP - UP • One and Two Potomac Yard is a good example of the Building Developer: • Meeting multiple requirements of master plan and site plans approvals • Accepting additional requirements caused by pre-leases to tenants with special needs: • Green Building requirements • Special security measures
For Educational Use Only
11
WRAP - UP • Assembling teams to meet the building challenges and regulatory constraints • Inadvertently creating conflicts with neighbors • Pre-selling the completed building to a building operator with staged funding commitments • Additional resources” • Awards of Building (LEED) • Reference LEED Materials for “Business Case for Green Buildings”
• “Lessons Learned and Learning at Potomac Yard”
For Educational Use Only
12
For Educational Use Only
1
REVIEW • • • • •
Lazard Freres Purchased in 1996 (Land Packaging) Master Plans approved in 1999(Alexandria) 2000(Arlington) Crescent Resources Purchased in 2001 (Land Development) Land Development for Crescent finished in 2005 Building Development on Arlington Land Bay A begins in 2003 (Design and Site Plan Approval Process)
For Educational Use Only
2
POTOMAC YARD ONE & TWO: BUILDING DESIGN AND PERMITS • 46 Requirements from the Phased Development Site Plan (PDSP) and Urban Design Guidelines • 71 Requirements from the 4.1 Site Plan approval
For Educational Use Only
3
PRE-LEASING TO THE GOVERNMENT SERVICES ADMINISTRATION Crescent was preparing to build a 654,000 square foot, two-tower building on Arlington Land Bay A, but Crescent: • Successfully responded to a GSA Request for Proposals (RFP) for 405,000 square foot, 10-year lease for the U.S. Environmental Protection Agency with two unique provisions: 1. Building must be Silver LEED-NC Certified upon Completion. Failure to meet the LEED Silver Certification would reduce the gross rent by 10% 2. Building must meet the U.S. Government’s requirement for Level IV Security
For Educational Use Only
4
RESPONDING TO THE GSA PRE-LEASE LEED-NC Silver Requirement: • Assemble of Team of Green Building Experts • Increased the Constructing Budget by $6.00 per square foot • Limited marketing of the remaining available space Level IV Security: • Re-designed 6-level parking structure to restrict parking to one predesignated building • Re-designed building lobbies to accommodate security equipment and personnel, and to restrict public access to designated areas
For Educational Use Only
5
CONSTRUCTION OF THE IMPROVEMENTS • Building Construction Costs : -
Land $ 8.8 million (6.8%) Hard Costs $ 91.2 million (70.6%) Soft Costs$ 29.0 million (22.5%) Total Costs $129.0 million (100%)
• Challenges: • • • • • •
Excavation below sea level On-site concrete batch plant for post tension concrete structure Staging of the precast panel assembly Green Builidng requirements Builidng Commissioning GSA Change Orders (385) For Educational Use Only
6
POTOMAC YARD ONE & TWO: BUILDING CONSTRUCTION PHASES
June 1, 2002 Start
October 20, 2004 Completion
2003 Sept.
2004 2004 2004 June 1 Phase II Starts
Nov. Dec. 4 Phase I Substantial Completion
For Educational Use Only
7
NEIGHBORS IN BUILIDNG DEVELOPMENT • The Builidng Development Process requires cooperation with Neighbors, especially adjacent land uses: • Here are examples of poor neighbor relations: • Pile driving activity during early morning hours woke up guests in the adjacent hotel. • Removal of existing road bed caused flooding in the adjacent underground parking garage. • The adjacent land owner started construction on an apartment building and both projects closed Crystal Drive Road while staging materials. • Re-bar bundle “nicked” a passing Virginia Rail Express Train as it was being lowered onto the building floor by an overhead crane (see next slide).
For Educational Use Only
8
LAND BAY A CONSTRUCTION CRANE AGREEMENT Left: Construction crane swing areas are shown. Note the overlapping of radials and onto adjacent properties,
Right: Cranes are color coded to match radial diagram and show crane placement in the buildings. For Educational Use Only
9
SALE OF ONE & TWO POTOMAC YARD • In September 2005, JP Morgan entered a purchase agreement for One and Two Potomac Yard for $213.5 Million with the following funding provisions: • Funding at Shell Completion: $100,000,000 • Funding at GSA Lease Commencement: 95,500,000 • Funding at LEED-NC Silver Certification: 18,000,000*
• At GSA Lease Commencement, JP Morgan took over the role of Builidng Operations Developer (Stage 5) *Achieved LEED-NC Gold Certification
For Educational Use Only
10
WRAP - UP • One and Two Potomac Yard is a good example of the Building Developer: • Meeting multiple requirements of master plan and site plans approvals • Accepting additional requirements caused by pre-leases to tenants with special needs: • Green Building requirements • Special security measures
For Educational Use Only
11
WRAP - UP • Assembling teams to meet the building challenges and regulatory constraints • Inadvertently creating conflicts with neighbors • Pre-selling the completed building to a building operator with staged funding commitments • Additional resources” • Awards of Building (LEED) • Reference LEED Materials for “Business Case for Green Buildings”
• “Lessons Learned and Learning at Potomac Yard”
For Educational Use Only
12
