FAA & ICE

FAA & ICE

Location:
950 L'Enfant Plaza, SW
Washington, D.C.
Owner / Client:

Federal Aviation Administration & Immigration and Customs Enforcement

Federal Aviation Administration & Immigration and Customs Enforcement

Awarded on September and October 2018

141,300 RSF / 3-4 year firm term renewal

Wow Factors: Deal reached within 2 months; Record Escalation Negotiated

 

Merrill Turnbull and Jae Lee led and represented ownership in both renewals for FAA and ICE. The agencies signed a 99,600 RSF and 41,700 RSF renewal, respectively. These were critical lease actions for the new ownership for which both agencies represented tenancy for approximately half of the building.

 

Each agency had its own set of requirements and uncertainties. Merrill and Jae were able to identify and obtain critical negotiating points on behalf of ownership while allowing certain lease obligations to be relaxed. Given that FAA was a direct lease with the agency and not with GSA, there were many characteristics of the lease that had to be analyzed and interpreted expeditiously prior to coming to final terms on the renewal.

 

Even though the requirements were not accommodative for the Lessor, Merrill and Jae were able to formulate and negotiate an above-market rent for the existing asset as evidenced by the following economics:

ICE/GSA – Five years with 4 years firm. $45.00 per RSF full-service rental rate. Operating Expense base was reestablished while Real Estate Tax base negotiated to remain the original base year. No concessions provided.

 

FAA – Five years with 3 years firm. $57.25 per RSF full-service rental rate for year 1 with a 5.00% annual escalation. The original base year for Operating Expense and Real Estate Taxes was maintained. No concessions provided.


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