Lease Reform – “One size does not fit all”

1. Lease Reform – “One size does not fit all” Client Solutions Division77 Forsyth Street, SWSuite 110Atlanta, GA 30303404.331.3584www.gsa.gov

2. What is “Lease Reform” (LRe) • A national effort to completely overhaul the GSA leasing process to introduce new models and processes. The goal was to: Simplify, Streamline, Standardize • Representatives from all 11 regions came together to developed 5 leasing models and introduce process changes based on best practices across the country • Simplified • Standard • Streamlined • Succeeding • On-Airport

3. Major Changes

4. Major Change – More Tools, Better Tools • The old way forced us to use one of two procurement packages, the “Full SFO” and the “short form” (3626) • The new way gives us 5 models to choose from to make sure we select the best one to meet the customer’s needs.

5. Leasing Models • SLAT • Streamlined • Succeeding/Superseding • Standard • On-Airport

6. Major Change – RLP/Lease vs. SFO • The SFO is being phased out • The 3626 is now only for use for disaster, parking, and warehouse leases • The RLP and Lease will be used in all future procurements • Better organized • Easier to read • Easier to understand

7. Major Change - Agency Specific Requirements Package (ASRP) • Increased focus on getting the agency to fully develop their requirements at the beginning of the project, instead of at the end • The more detail you have up front, the less time you spend developing it after award • In order to use the new SLAT and Streamlined models, you must have a fairly detailed ASRP, but you will save lots of time during the procurement • DID Workshop • Turn-Key

8. Major Change – More Balanced Approach • Offerors were forced to commit their space to GSA procurement for a long time • No cash flow, holding the space off the market • Successful Offerors must then continue to wait through a lengthy design and build-out process before they receive any payment • This new process is more balanced to our private sector business partners Lessor commits space to GSA procurement Lessor commits space to GSA procurement Shortened Design and Construction Lessor receives award but still has no cash flow through design and construction Agency occupies space Agency occupies space 6 -8+ months 12+ months 3-6 months 3-6 months GSA develops detailed requirements up front

9. The New Leasing Models

10. Standard Model

11. Standard Lease Model • Simplify • Utilizes the RLP/Lease format to better organize the documents • Confusing sections are revised to better define the role and responsibilities of the Govt. and Lessor • Standardize • RLP/Lease documents help to eliminate the region to region differences • Streamline • Incorporates the new process changes and that all models utilize

12. Standard Model • Most similar of the new models to our current “TI-SFO” process • TI allowance approach used • Can be used for all procurements • LCO can always choose to incorporate elements of the other models to improve or speed up the process • DID workshop • Detailed ASRP – always preferable

13. Standard Model • No more SF2 • Information incorporated directly into the “Lease” • No more 3516 • Information incorporated directly into the RLP • Clarifies terminology • RLP highlights the minimum eligibility requirements, simplifying the process for Offerors

14. Standard Model The standard model is always available Standard Model Streamline Model Succeeding Model SLAT Model On-Airport Model

15. SIMPLIFIED Model

16. Simplified Leasing Model • Replaces the old 3626 • Turn Key – Simplified Post-Award Process • Full ASRP required from agencies up front • Final TI costs included in offer • Speeds up design time post-award and eliminates a significant source of agency caused delays • Award can be based on initial offers

17. Succeeding Lease Model

18. Succeeding Lease Model • Simplify • The RLP/Lease eliminates language not applicable a sole source succeeding lease • Standardize • RLP/Lease documents provide a consistent format and set of language for everyone • Streamline • New “National Decision Tool” spreadsheet helps you do a cost benefit analysis quickly using pre-loaded cost data • All improvements needed identified in the Lease and priced up front, no TI negotiations post-award • Carpet/Paint • Etc. • The documents do not contain construction language, significantly reducing the document size

19. Succeeding Leasing Model • Cycle Time Enhancements • No ad required if under 10,000 rsf • Still must perform market search (COSTAR, Loopnet, etc.) and promote competition to the maximum extent practical • More open and informal negotiation procedures • Forms “acknowledge” that it is a sole source negotiation

20. Streamlined Model

21. Streamlined Lease Model • Simplify • TI can be handled one of three ways – choose the method that works best for you • Standardize • RLP/Lease documents • National “ASRP” Template (coming soon) • Streamline • Detailed requirements and prototype layout received up front • “DID Workshop” after award that lasts 2-3 days and the agency approves the DID at the end of the workshop

22. Streamline Model • Bridges the gap between the SLAT and Standard models • Can be used for leases up to $500k annual rent • TI can be handled 3 ways – choose the method that works best for your project • Turn-Key – final TI costs bid up front • Unit-Cost – “typical” TI costs bid up front, final costs determined using the unit costs • TI allowance – our current process

23. On-Airport Model

24. On-Airport Model • Simplify • Documents are tailored towards airport leases • Standardize • Flexibility in the RLP/Lease helps us to use this form at more airports as opposed to having to use their form • Streamline • Documents contain options to reflect the different levels of service available at different airports, making it quick and easy to tailor the RLP/Lease to your situation

25. On-Airport Model • Blanket JOTFOC • Streamlines the process of contracting for alterations when the airport does not perform them • Renewal Options built-in to reduce procurement time for succeeding procurements

26. Lease Reform - “In The Works”

27. Lease Reform – “In the Works” • Lease Acquisition Training (LAT) -Between now and the end of the fiscal year, over 1,200 members of the leasing community nationwide will be trained.  (Initial training was provided on a regional level) -The first class is scheduled in Atlanta for week of April 9th • Agency Specific Requirements (ASR)(National team)

28. Lease Reform – “In the Works”