1 predevelopment suzanne keech corporate managing director, studley, inc. june 2010
TRANSCRIPT
![Page 1: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/1.jpg)
1
PredevelopmentPredevelopment
Suzanne KeechCorporate Managing Director, Studley, Inc.
June 2010
![Page 2: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/2.jpg)
2
Facilities Process Overview
![Page 3: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/3.jpg)
3
Real estate—second highest expense for schools
Financial viability—dependent on “smart” decisions
Quality of space—linked to student performance
Error/misstep—significantly impacts space quality and cost
Why Is Predevelopment So Important?
3
![Page 4: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/4.jpg)
4
Thurgood Marshall Academy’s First School
![Page 5: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/5.jpg)
5
Blue Castle/Thurgood Marshall Academy Facilities
![Page 6: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/6.jpg)
6
Predevelopment Topics
The process The team Site selection• Qualitative and quantitative evaluation
Ownership vs. lease Feasibility analysis
• Sources and uses document• Pro forma
Due diligence
![Page 7: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/7.jpg)
7
The Predevelopment Process
Step 1: Build the team.Step 2: Review and refine the educational
facilities plan.Step 3: Identify all feasible real estate
alternatives.Step 4: Evaluate each alternative.
![Page 8: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/8.jpg)
8
The Predevelopment Process
Step 5: Rank alternatives.
Step 6: Recommend site to Board of Directors.
Step 7: Negotiate terms and finalize documentation.
![Page 9: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/9.jpg)
9
“School”Charter School
Board of DirectorsParents/Students
Owner’s Representativeand Construction/Project Manager
SchoolDesignated
Representative
Legal Counsel
Government Relations AdvisorReal Estate Broker
Architect
EngineerGeneral Contractor
Environmental ConsultantOther Consultants
The Team
![Page 10: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/10.jpg)
10
Selection Criteria for Team Members
Qualifications/experience on similar projectsProfessionals dedicated to projectFee structureReferences
![Page 11: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/11.jpg)
11
Advice for Building a Successful Team
Hire based on qualifications/experience, team, references, and fee.
Outline scope of services, method of payment, and time frame for completion in each contract.
Exercise right of termination if performance is unsatisfactory.
![Page 12: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/12.jpg)
12
Property’s conformance to education specifications
LocationCondition of property and physical features
of site
Site Selection: Qualitative Evaluation Criteria
![Page 13: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/13.jpg)
13
Lease terms• Length of term• Sublease and assignment• Renewal rights
Legal and timing issues
Other risk factors
Site Selection: Qualitative Evaluation Criteria
![Page 14: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/14.jpg)
14
Site Selection: Quantitative Evaluation Criteria
Lease or own• Economic terms—purchase price or lease rate
Budget• Operating—cost of utilities, repairs and
maintenance, taxes (if applicable)• Capital—cost to improve the space, renovate
the existing structure, or build a new one
![Page 15: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/15.jpg)
15
Ownership or Lease: Economic Terms
15
Own Lease
Purchase price—equity and debt required
Rent and rent escalations
Cost of operating expenses and real estate taxes (if applicable)
Cost of operating expenses and real estate taxes (if applicable)
Cost of capital improvements
Cost of tenant improvements and landlord’s contribution
![Page 16: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/16.jpg)
16
Ownership: Advantages and Disadvantages
16
Advantages Disadvantages
Long-term control of property
Amount of money required upfront
Asset appreciation Ongoing capital and maintenance responsibilities
Control of operating costs by elimination of rent escalation
Potential savings in real estate tax exemption
![Page 17: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/17.jpg)
17
Advantages Disadvantages
Less capital required up front
Expend capital on a building you don’t own
Limited time commitment to property
Term is limited
Flexibility
May have less responsibility for capital maintenance of property
Lease: Advantages and Disadvantages
![Page 18: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/18.jpg)
18
Feasibility Analysis
Process of combining the economic terms of each alternative with the economic resources of the school
Key documents• Sources and uses• Pro forma
![Page 19: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/19.jpg)
19
Sources and Uses
![Page 20: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/20.jpg)
20
Pro Forma
![Page 21: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/21.jpg)
21
Due Diligence
21
Conduct environmental survey.Conduct title search and review. Ensure conformance with zoning.Identify the “unknowns” and ensure that
both the risk and associated monetary obligations are accounted for in the program.
![Page 22: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/22.jpg)
22
Ensure team synergy. “Am I responsible for that?”
• Outline scope of work in every contract. Feasibility analysis demonstrates school’s
long-term economic viability.Who created that budget anyway?• Refining and updating the budget at every stage
is critical.
Predevelopment: Key Take-Aways
![Page 23: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/23.jpg)
23
Q & A
![Page 24: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/24.jpg)
24
Thurgood Marshall Academy’s Home
![Page 25: 1 Predevelopment Suzanne Keech Corporate Managing Director, Studley, Inc. June 2010](https://reader035.vdocuments.us/reader035/viewer/2022081519/56649e835503460f94b84f8b/html5/thumbnails/25.jpg)
25
Suzanne KeechCorporate Managing Director, Studley, Inc.P: 202-624-8504 > F: 202-624-8555E-Mail: [email protected]
National Charter School Resource Center1100 17th Street NW, Suite 500Washington, DC 20036-4632Phone: 877-277-2744Fax: 202-223-8939E-Mail: [email protected]
25