Challenge
Allegro was engaged by a not-for-profit mental health services organization to evaluate its options for its growing headquarters facilities. Due to significant growth and several incremental expansions over the prior 15 years, the client resided in a highly inefficient floor plan with aging tenant improvements.
Solution
Allegro assisted the client in determining its needs and evaluating its alternatives, which included the following requirements: 1) more than 30,000 sq. ft. to accommodate current needs and room to expand; 2) the ability to own the building (subject to a planned capital raising campaign); and 3) direct access to public transportation. Allegro analyzed customer and employee residential locations to help identify the geographic parameters for the market search. Additionally, Allegro analyzed own versus lease scenarios as well as different applications of public and private funding sources. An exhaustive market search was conducted to locate alternatives of large blocks of space in a very tight real estate market. Once a short list of pre-qualified alternatives was identified, Allegro distributed a Request for Proposal to evaluate outright purchases, build-to-suit (own or lease) projects, lease transactions with purchase options, and a complex structure to renew and renovate its existing facilities. In early 2007, the client relocated to a 41,000 sq. ft. contemporary building, initially occupying 33,000 sq. ft. with a pre-negotiated purchase option, expansion rights and renewal options.
