AUTOMOTIVE PANEL PRESENTED TO Meet the Consultants Southern Economic Development Council March 31, 2015 0 GLOBAL CORPORATE REAL ESTATE ADVISORS
MOHR PARTNERS Founded in 1986 Largest North American corporate real estate services company exclusively dedicated to the corporate client Managing portfolios for corporate clients is our core business Mohr only represents tenants - no landlords! Top 100 fastest growing dynamic, privately held companies 1 1
CORPORATE SERVICES OVERVIEW PORTFOLIO ACCOUNT MANAGEMENT PARTNER AND PRINCIPAL LEVEL LEADERSHIP Portfolio assessment Proactive consulting PAM - Single point of contact Salaried, corporate professionals Performance-based execution Uniform service delivery on ALL transactions Policies and procedures Strategic, proactive approach Real-time updates (transaction tracking in database) Critical date management Transaction management Business point legal review/lease redlining Financial analysis/comparison CAPITAL MARKETS Sale Leasebacks Dispositions Income Tax Mitigation Programs Merger & Acquisition Advisory Mark-to-Market Lease Implementation Tax Driven Financial Structures Build-to-Suit Financing Opportunity Analysis GAAP - Cash Flow Analysis PORTFOLIO/LEASE ADMINISTRATION Centralized real estate portfolio Information management Real-time web-based portfolio/lease admin solutions specific to client requirements Custom C-suite and ad-hoc reporting Capture KPIs A/P and A/R services Identify landlord-biased language Document management Desktop/lease audits Exception & security deposit recovery assist. Cost segregation Tax appeals 2 PROJECT AND CONSTRUCTION MANAGEMENT Pre-site selection assessment Programming & space planning Corporate standards Budgets Vendor selection Construction management 2 Build-to-suit development TECHNOLOGY PLATFORM Total move coordination INTEGRATION RESEARCH AND SITE SELECTION Salaried research professionals Verified market intelligence Labor and demographic analyses GIS mapping Access to numerous commercial real estate intelligence tools Economic Incentives Practice
New Requirement Jeffersonville, Indiana 300,000 Square Feet with ability to grow to 400,000 Square Feet Space Type: Hi-bay, Manufacturing, Distribution Market Analysis/Site Selection of Michigan, Ohio, Kentucky, Tennessee and Indiana Facilitated incentive discussions with local and state governments Conducted comprehensive programming to accommodate current and future space requirements 300,000 Square Foot facility with rights to grow an additional 100,000 Square Feet State of the Art manufacturing facility designed to enhance collaboration, increase space utilization and functionality Negotiated Tenant Improvement package that included: Tenant Improvements, FF&E, Relocation Allowance and Process Fit-up Received incentive package from local and state municipalities of $3.7 Million 3
New Tank Fabrication Facility San Luis Potosi, Mexico 83,420 Square Feet Space Type: Manufacturing and Office Opportunity Analysis Market Analysis/Site Selection Financial incentive discussions with the local governments Conducted comprehensive programming to accommodate current and future space requirements Below market lease rate Beneficial occupancy prior to lease commencement Free rent period Turnkey build out per Tenant s detailed specifications Received incentive package from the local government 4
Relocation and Consolidation of Two Facilities; Build to Suit Auburn Hills, Michigan 168,056 Square Feet Project Type: Existing/Build to Suit Space Type: Office, Tech, Hi-bay, Testing Facility Assessment/Opportunity Analysis Market Analysis/Site Selection Facilitated incentive discussions with local and state governments Conducted comprehensive programming to accommodate current and future space requirements Interviewed top developers for Build-to- Suit opportunity 5 Growth from 128,400 to 168,056 Square Feet State of the Art high tech center designed to enhance collaboration, and increase space utilization and functionality Negotiated Tenant Improvement package that included: Tenant Improvements, FF&E, Relocation Allowance and Process Fit-up Prominent exterior signage on I-75 frontage Received incentive package from local and state municipalities of $1.5 Million
Relocation & Consolidation Burlington, ON 154,000 Square Feet Relocation & Consolidation of 2 Facilities Space Type: Industrial/Manufacturing Facility Assessment/Opportunity Analysis Market Analysis/Site Selection Site Disposition Analysis of Owned Facility Mohr Partners was engaged to strategically plan an asset disposition of the owned facility and lease restructure of leased facility continued Options included restructure leased asset and continue to occupy the owned asset, sell the owned asset and expand at the current leased facility, relocate and consolidate both facilities and sell the owned asset Through detailed analysis, the result was a simultaneous consolidation and relocation with asset disposition resulting in client not holding a vacant asset through the process Negotiated a below market lease rate on the consolidated facility Site disposition resulted in capital gains of $4.75 Million 6
Relocation of Tech Center and Consolidation of Business Units Farmington Hills, Michigan 90,460 Square Feet Relocation of Tech Center Consolidation of multiple facilities (business units) into a single location Space Type: Office, R&D, Tech Opportunity Analysis Market Analysis/Site Selection Facilitated incentive discussions with local and state governments Conducted comprehensive programming to accommodate current and future space requirements Lease Negotiation Portion of the space to be rent free throughout the term Phased absorption into the space Below market lease rate Twelve (12) months free rent Negotiated Tenant Improvement package to avoid Tenant having to come out of pocket; Tenant able to use a portion of the allowance for relocation, FF&E, and IT costs Received incentive package from local and state governments 7
Headquarters Facility Northville, Michigan Engaged to Restructure Lease and Purchase Adjacent R&D Tech Facility Restructure 99,502 Square Foot Facility Purchase 17,999 Square Foot Facility Tenant / Existing Facility Space Type: Office and R&D Tech Opportunity Analysis Market Analysis / Site Selection Conducted a Comprehensive Programming to accommodate current and future space requirements Lease Negotiation (Expansion option allows client to control the park) 8 continued Received Expansion and Renewal Options Strategic Facility Plan determined option to relocate R&D facility was cost-prohibitive due to capital investments in the facility Restructure Lease of 99,502 SF Reduced Lease Rate by $6.00/RSF per year Savings of approximately $850,000 Restructuring took effect twelve (12) months prior to lease expiration Purchased 17,999 SF R&D Tech Facility for $1.67 Million Leveraged Lease Negotiations with the purchase of the R&D Facility, allowing ownership to restructure its debt with the lender
Lease Renewal and Restructure of R & D Tech Center Farmington Hills, Michigan 75,000 Square Feet Space Type: Office, R & D Tech Project Type: Existing / Build to Suit Facility Assessment Engaged to Evaluate Space Needs/Potential Growth Initial Determination Growth to Approximately 75,000 Square Feet Lease Restructure Negotiation 9 Growth from 45,000 to 75,000 Square Feet Vetted Expansion via short term lease coterminous with lease expiration at new location versus Relocation/Build to Suit Twelve months free rent at an existing 75,000 Square Foot building to meet immediate expansion needs while lease burns off at previous location; eliminates double rent and allows for flexible relocation process Funded $1.5 Million in Tenant Improvements Received incentive package from local and state municipalities of $750,000
Relocation & Consolidation Lexington, Kentucky 400,000 Square Feet Relocation & Consolidation of 2 Facilities Project Type: Existing Building & Build to Suit Space Type: Industrial/Distribution Facility Assessment/Opportunity Analysis Facilitated incentive discussions with local and state governments Detailed Market Analysis/Site Selection Conducted comprehensive programming to accommodate current and future space requirements Interviewed top developers for Build to Suit opportunity 10 In Negotiations / In Process Aggressive below market lease rate based on capital market returns Economic incentives from the State of Kentucky & City of Lexington State of the Art, Turnkey Distribution Center
PROJECT TEAM GREGORY KRZYSKO MANAGING PARTNER CHICAGO, ILLINOIS 11 Clients Represented: Actuant AT&T Autoneum Butzel Long Delphi Daimler Chrysler Delphi DeVry Duke Energy Freudenberg NOK GEMS GKN Driveline Haworth Henniges Automotive Hexagon Metrology Institute for Population Health ION Trading Kopp Electric Metaldyne North American Lighting Panasonic Sears Roebuck & Co. Siemens Torchmark TI Automotive USG Vestas Whitesell Corporation Xerox Gregory Krzysko is a Managing Director in Mohr Partners Chicago, IL office. He provides Mohr clients with strategies that align business requirements with real estate solutions to achieve the best overall outcome. Mr. Krzysko has been active in providing real estate solutions that enable clients to release capital, decrease cost, improve flexibility and enhance financial performance for over 18 years. Mr. Krzysko gained substantial experience in the development of a wide range of strategic business plans while serving as a key member of the corporate financial staff of Sears Roebuck & Co. during the time Sears was a Fortune 25 company. As a member of the Sears management team advising the CFO, he recommended strategic acquisitions, corporate restructuring, alternative financing structures and multi-million dollar real estate transactions. Mr. Krzysko was a member of the financial team that created several billion dollars of shareholder value through Sears divestiture of Dean Witter, Allstate, Coldwell Banker and Homart Development. He later created and headed a group that specialized in structuring and analyzing the real estate portfolio for Sears. In addition to Mr. Krzysko s experience at Sears, he has performed commercial property valuations for bank financing, real estate tax assessment and estate judicature purposes. Relevant Experience Provided financial analysis and debtor committee court support in analyzing headquarters relocation options for a Fortune 500 manufacturing company in Chapter 11 bankruptcy. Analysis considered cash flow, tax and financial statement impacts of alternatives as well as meeting Big-4 external auditor approval for GAAP. Relocation option selected resulted in a 15-year lease for over 300,000 square feet and produced $21 million of present value cost savings. Arranged first mortgage financing for a portfolio of office/flex properties totaling over 169,000 SF for a food manufacturer seeking to extract equity from non-core assets. Resulted in an $8.3 million mortgage loan that exceeded the client's specified criteria. Involved a request for proposal process where a select group of lenders were chosen to submit loan terms. Structured and marketed a build-to-suit development for an international manufacturer in Mexico City. Provided a securitized lease from an array of options including a traditional leasing agreement and several off-balance-sheet structures. Structure selected provided present value savings of more than $23 million on a $51 million project. Education Mr. Krzysko received a Master s of Business Administration from the Kellogg School of Management at Northwestern University specializing in management, strategy and finance. He also received a Bachelor of Science from the Illinois Institute of Technology in Civil Engineering.
PROJECT TEAM RANDALL D. TARNOW, ESQ. MANAGING PARTNER DETROIT, MICHIGAN Clients Represented: Actuant AIAG Autoneum Butzel Long Daimler Chrysler Enovate Freudenberg NOK GKN Driveline Global Hue Henniges Automotive Hexagon Metrology Institute for Population Health Market Strategies MEAA Metaldyne North American Lighting Panasonic TechSmith TI Automotive Stefanini Sumitomo Electric Wiring Systems Syntel Whitesell Corporation Randall D. Tarnow is a Managing Partner in Mohr Partners Detroit, MI office, bringing over 27 years as a tenant / corporate real estate advisor. Mr. Tarnow has concentrated his expertise in tenant advocacy, portfolio assessment, and strategic facility planning. Further, Mr. Tarnow has been uniquely involved in the development of real estate facility planning and account management for Sumitomo Electric Wiring Systems, Syntel and Autoneum. Before joining Mohr Partners, Mr. Tarnow served as a principal with Friedman Real Estate Group and an executive managing director in Newmark Knight Frank s Detroit office. Since 1986, Mr. Tarnow has worked as a commercial real estate consultant, completing numerous transactions for tenant renewal, relocation and build-to-suit requirements. His transaction experience ranges from 500 to 1 million square feet and includes work with various corporate clients in strategic assessment through implementation. Relevant Experience Panasonic Tech Center. Landlord incentives of approximately $2.3 million, and expansion and renewal options. Assisted in the evaluation and construction management of tenant improvements. Facility Assessment, Strategic Planning and Relocation of GKN Driveline s Corporate Headquarters/Tech & Engineering Center to a new Build to Suit facility in Auburn Hills, Michigan, strategically aligning Tenant s business goals and objectives. Negotiated and Leased New Facility for Institute for Population Health in downtown Detroit, Michigan. Incentives included $900,000 in tenant improvements, early termination right, and renewal options. Built-to-Suit for TI Automotive new San Luis Potosi, Mexico based manufacturing facility. Negotiated municipal incentives upwards of $1 million. Lease Restructure for Butzel Long Headquarters 101,000 gross square-foot corporate headquarters in Detroit, Michigan. Negotiated landlord incentives of approximately $3.1 million, expansion and renewal options. Education Mr. Tarnow received his Law Degree from the University of Detroit School of Law 12
THANK YOU! 13 GLOBAL CORPORATE REAL ESTATE ADVISORS