Transcript Social Infrastructure: Case Studies of Success

SOCIAL INFRASTRUCTURE
SUCCESSES
Moderator:
Les Nicholson- Pillsbury Winthrop Shaw
Pittman;
former General Counsel of GSA
Panelists:
Misty Baskett- National Development Council
Rich Hill- Faegre Baker Daniels LLP
Bo Kemp- Special Advisor to the Mayor of Gary, Indiana
Jim Napolitano- Special Projects Manager for King County
Pillsbury Winthrop Shaw Pittman LLP
Projects:
1. 440,000 sq. feet Medical Office Building
King County, Washington
2. Gary/Chicago International Airport
P3 Expansion
Interactive Panel Discussion of These
Projects
1. Primary issues
2. Process/plan utilized
3. Immediate, tangible results
4. Long terms results
5. Lessons learned
1 | Social Infrastructure: Case
Studies of Success
Recent Projects Using 63-20
and Related Approaches
Ninth and Jefferson Building

King County, Washington

440,000 sq. ft. Medical Office Building

LEED Gold

Erased a $30,000,000 project overrun
on previous GC-CM process

The BOMA 2011 Outstanding Building
of the Year (TOBY) award for
excellence in the medical office
category

Financing: 63-20 Bonds

Bond Issue: $189,720,000
2 | Social Infrastructure: Case
Studies of Success
A Profile in Public Benefit

By the time the original GCCM group finished
excavating the site, they were facing a $15
MILLION budget overrun

The University’s renovation of the
Inpatient Expansion Building (IEB) had a
similar $15 MILLION budget overrun

King County elected to transfer $15 MILLION
from the Ninth and Jefferson Building to fill the
gap on the IEB.

This left King County with a $30 MILLION
budget gap; effectively killing the NJB project.
3 | Social Infrastructure: Case
Studies of Success
A Profile in Public Benefit

King County Partnered with National
Development Council to assist with financing
and development.

A development Team was assembled; NDC as
Owner, Wright Runstad as Developer, NBBJ as
Architect, and Turner as General Contractor.

This team was able to triple the usable square
feet within the existing footprint and reduce
development costs from $800 per sq. ft. to $450
per sq. ft.

Erasing the $30 Million deficit.
4 | Social Infrastructure: Case
Studies of Success
A Profile in Public Benefit
“Budget was well managed”
“Approximately $7.6 Million
joint savings achieved on shell
and core.”
“Restructured project was
delivered at substantial
savings compared to initial
project estimate”
“The medical office building cost 50% less per square foot”
5 | Social Infrastructure: Case
Studies of Success
City of Gary/Gary Chicago International
Airport Development Agreement
 Master Developer
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
AFCO Gary, LLC
Aviation Facilities Company, Inc.
Guggenheim Securities
Loop Capital
 Financial Terms
7 | Social Infrastructure: Case
Studies of Success
City of Gary/Gary Chicago International
Airport Development Agreement (Cont’d)


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Developer required investment of $25M in first 36 months
$2.5M in first 12 months
$100M over 40 year term
City revenue sharing through
 Sale of City or Airport property
 Lease of City or Airport property
 Annual rental amount supplemented if net profit level not reached by

rental amount
Contribution of property by the City or Authority
 20% of profits derived from contributed property
8 | Social Infrastructure: Case
Studies of Success
Investment in Community Development
 Investment in Community Development


$300,000 in the first 3-6 months
Workforce Development Requirements



Local participation – 30%
DBE/MBE participation – 20%
WBE/ABE participation – 5%
9 | Social Infrastructure: Case
Studies of Success