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Parklawn Lease Expiration - 2010
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FY
2007 Actual |
FY
2008
Enacted |
FY
2009
Estimate |
FY
2009 +/-
FY 2008 |
BA |
--- |
--- |
$36,062,141 |
+$36,062,141 |
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Authorizing
Legislation: Section 301 of the Public Health Service
Act.
FY
2009 Authorization |
Indefinite
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Allocation
Method |
Other
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Budget Request
Since HRSA is the single largest tenant in the Parklawn
Building, funds are requested centrally in the HRSA
budget to most effectively manage the project with
the General Services Administration. The current lease
of the Parklawn Building expires on July 31, 2010;
consequently, a long-term housing solution for the
building occupants must be found. The Parklawn Building
itself has become functionally obsolete after 40 years
of occupancy, and would require a substantial modernization
effort by the landlord to meet minimum federal standards.
The inefficient design of the building significantly
limits space layout on each floor, which also increases
the amount of space that must be leased. GSA requires
a total of $87 million (including $36 million in the
FY 2009 HHS budget) to support a competitive lease
procurement and to meet updated space requirements
for a modern, efficient workplace.
Lease Replacement -When the existing
lease expires on July 31, 2010, HHS has the option
of remaining in the Parklawn Building or moving to
a new leased location. In either case, the expiring
contract is to be replaced with a prospectus-level
lease, which also consolidates three other smaller
leases for other HHS tenants (6010 Executive Boulevard,
Rockwall, and Silver Spring Centre). In addition,
a lease extension will be required to provide the
time necessary for a competitive procurement to replace
the existing lease.
GSA has received Congressional authorization for this
lease transaction. The Senate Environment and Public
Works Committee approved the request in September
of 2006 and the House Transportation and Infrastructure
Committee approved the request in June of 2007.
Project Summary - The new lease must
incorporate space needs for 2,484 current Parklawn
tenants as well as tenants from three other current
HHS-leased properties. The total existing requirement
for usable square footage is 794,463. However, the
maximum usable square feet included in the prospectus
is 779,501, due to an expected increase in space efficiency
with a new lease.
Estimate of Required Usable Square Footage
|
Current
Parklawn Tenants |
697,126
Usable Square Feet (usf) |
Other
HHS Tenants included in Prospectus: |
|
6010
Executive Blvd
|
12,845
usf |
Rockwall
I
|
16,187
usf |
Silver
Spring Centre
|
68,305
usf |
Total Current USF Space Requirement |
794,463
usf |
Total
Prospectus USF Space Requirement |
779,501
usf |
Usable
square footage includes assigned tenant occupied space;
it excludes common areas such as restrooms, elevator
lobbies, and hallways. Rentable square footage (rsf)
includes these common areas and must be included in
the rent and total square footage calculation. The
estimated total rsf for this lease procurement is
935,401.
Prospectus
Details |
Rental
Rate |
$32.00
per rentable square foot (rsf) |
Total
Annual Cost |
$30
million |
Delineated
Area |
Suburban
Maryland |
Lease
Term |
15
years |
Total
Lease Size |
935,401
rsf |
Project
Schedule -The current project schedule, which
assumes funding in FY 2009, estimates that all tenants
will be housed in new or updated space by May 2011.
The Parklawn lease extension is reflected in the adjusted
project schedule.
Project
Benchmark |
Projected
Timeline |
Macro
Program of Requirements (POR) |
August
2005 |
GSA
National Office Approval |
October
2005 |
OMB
Approval |
January
2006 |
Senate
Environment and Public Works Committee Approved
|
September
2006 |
Micro
POR/SFO Development |
December
2007 |
House
Transportation and Infrastructure Committee Approval |
July
2007 |
HHS
Funding in President’s Budget |
January
2008 |
Lease
Procurement Start |
February
2008 |
Lease
Award/Reimbursable Work Authorization for Fit-up
Costs |
January
2009 |
IT/Workstations
Installation Complete |
October
2010 |
Design
& Construction Complete |
January
2011 |
All
Moves Complete |
May
2011 |
Existing Lease Expiration |
July
2010 |
Extended
Lease Expiration |
July
2011 |
In
the short-term, without the benefit of a competitive
procurement, HHS will likely face sizeable vacancy
costs, damage claim costs, and higher rent. In the
long-term, without the procurement support funding,
HHS staff will be housed in substandard space conditions
enduring multiple moves and renovation projects. The
result to the taxpayer will be a less effective agency
and less value at a greater cost.
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