Challenge
Medical Mutual, a Fortune 1000 health insurance company, has been a client of Allegro’s since 2013. They have several lease expirations approaching in 2020 and came to Allegro seeking a strategic real estate plan that would lay out how they could best consolidate five facilities into one or two – either one fully consolidated headquarters or a headquarters and an operations center.
Solution
Phase one of the strategic plan was a current state assessment which involved evaluating Medical Mutual’s existing portfolio. Allegro analyzed the current utilization of space by building and department, developed drive time maps for employees at all locations relative to where they lived, conducted market comparative analysis to determine whether they were paying below, at, or above market value for each property, and reviewed occupancy costs. The Allegro team interviewed Medical Mutual’s executives to understand their visions and preferences for each department and developed an understanding of the square footage requirements for each team. From there, Allegro began to look at various scenarios for them, including owned vs. leased, single vs. multi-tenant, dual facilities vs. full consolidation, and new construction vs. existing structure situations, and developed high-level financial projections for each option.
Phase two of the strategic plan focused on a future state assessment and gap analysis, where each future scenario was analyzed at length. Allegro led Medical Mutual through an architect selection process and an architectural space program for each building and by department, and applied that program to future state scenarios in order to refine the financial projections. As part of Allegro’s analysis, case studies were conducted on five comparable corporations who had recently gone through the headquarters process in order to understand their decision making processes. All scenarios were then market tested for feasibility and financial effectiveness.
Ultimately, Allegro’s strategic plan laid the groundwork for Medical Mutual to reshape its physical future in 2020, a once in a generation opportunity. The final deliverable presented to the client that mapped out Allegro’s preferred strategy set the stage for the client’s strategic, operational, cultural, and financial success in the future.
