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CIVIC CAMPUS MASTER PLANEconomic Development &Innovation CommitteeMay 22, 2018
CURRENT STATE OF DOWNTOWN FACILITIES
FUTURE OF DOWNTOWN FACILITIESAvery B. Upchurch Complex (RMB Block)• Raleigh Municipal Bldg.
(RMB) 1983• 110 McDowell-Vacant (Old
Police HQ) 1963
11
234
5
6
2
Professional Bldg.
310 West Martin Bldg. (Dillon Bldg.) 1993
34
One Exchange Plaza (OEP) 2004
56
Briggs Building
One City Plaza
CURRENT DOWNTOWN CAMPUS
1
2
3
4
5
6
FUTURE OF DOWNTOWN FACILITIESAvery B. Upchurch Complex (RMB Block)• Raleigh Municipal Bldg.
(RMB) 1983• 110 McDowell-Vacant (Old
Police HQ) 1963
11
234
5
6
2
Professional Bldg.
310 West Martin Bldg. (Dillon Bldg.) 1993
34
One Exchange Plaza (OEP) 2004
56
Briggs Building
One City Plaza
ADDING FACILITIES OVER TIME
1 1983147,000population
64square miles
FUTURE OF DOWNTOWN FACILITIESAvery B. Upchurch Complex (RMB Block)• Raleigh Municipal Bldg.
(RMB) 1983• 110 McDowell-Vacant (Old
Police HQ) 1963
11
234
5
6
2
Professional Bldg.
310 West Martin Bldg. (Dillon Bldg.) 1993
34
One Exchange Plaza (OEP) 2004
56
Briggs Building
One City Plaza
1
2
3
4
5
6
2018460,000population
147square miles
ADDING FACILITIES OVER TIME
SECURITY CHALLENGES
Multiple building ENTRANCES
Unsecured PARKING
Lack of site PERIMETER security (bollards)
Lack of security SCREENING (turnstiles, metal detectors)
INCONSISTENT level of security between facilites (owned vs. leased)
INFRASTRUCTURE COST
• SERVERS• FIBER OPTIC LINES• NETWORKS
INFORMATION TECHNOLOGY (IT)
• FIRE• ACCESS• EMERGENCY BACKUP (GENERATORS)
BUILDING SYSTEMS
• ADDITIONAL PERSONNEL REQUIREDMAINTENANCE AND OPERATIONS
INEFFICIENT USE OF SPACE
DUPLICATION of resources
UNIQUE layouts for each building we occupy
Increased cost of providing INFRASTRUCTURE
Loss of time and cost due to CHURN
ADA + CUSTOMER SERVICE
City-owned facilites need ADA RENOVATIONS
2 of 3 Leased facilities DO NOT MEET ADA requirements
9 service locations spread across 3 buildings
Public meeting spaces are UNDERSIZED
A FRAGMENTED organization is CONFUSING for citizens
ACCESS
PROXIMITY TO AVAILABLE PARKING
PROXIMITY TO PUBLIC TRANSIT HUBS
SOCIAL EQUITY
FUTURE OF DOWNTOWN FACILITIESAvery B. Upchurch Complex (RMB Block)• Raleigh Municipal Bldg.
(RMB) 1983• 110 McDowell-Vacant (Old
Police HQ) 1963
11
234
5
6
2
Professional Bldg.
310 West Martin Bldg. (Dillon Bldg.) 1993
34
One Exchange Plaza (OEP) 2004
56
Briggs Building
One City Plaza
CHALLENGES OF A FRAGMENTEDCAMPUS
SECURITY
INFRASTRUCTURE
USE OF SPACE
ADA + CUSTOMER SERVICE
ACCESS
CITY OWNED BUILDINGS
BUILDING SQFT
AGE OF BUILDING
10 YEAR CAPITALMAINTENANCE
EMPLOYEES
RALEIGH MUNICIPALBUILDING
DILLON BUILDING
ONE EXCHANGE
PLAZA
110 MCDOWELL
35 YEARS(1983)
$2,146,000
120,000 SQFT
379
53 YEARS(1965)
$1,050,000
45,000 SQFT
110
33 YEARS(1985)
$3,003,000
130,000 SQFT
331
59 YEARS(1959)
57,000 SQFT
VACANT
$100,000
CITY-OWNEDBUILDINGS
CITY LEASED BUILDINGS
BUILDING SQFT
LEASING COSTS
EMPLOYEES
PROFESSIONAL BUILDING
BRIGGS BUILDING
$189,000
15,000 SQFT 16,000 SQFT11,000 SQFT
51
$300,000
15
$574,000
80
ONECITY PLAZA
LEASEDSPACE
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
Renovate & later Replace Municipal Deck
Renovate RMB
Demolish Old Police HQ
RenovateOEP
REQUIRED MAINTENANCECURRENT FACILITIES
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
REQUIRED MAINTENANCECURRENT FACILITIES
Demo Police HQ(5 Years)$171,360
RMB & OEP Security(5 Years) $2,500,000
RMB ADA Upgrades(5 Years) $3,000,000
Demo Municipal Deck(10-15 Years)$261,600
Replace Municipal Deck(10-15 Years)$14,030,000
RMB Systems Upgrade(15 Years)$32,000,000
OEP Systems Upgrade(20 Years) $19,500,000
Soft Cost$8,750,000
COST ESTIMATES
$80,000,000+Cost estimate in today’s dollars.
TOTAL
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
COST ESTIMATES
Demo Police HQ(5 Years)$171,360
RMB & OEP Security(5 Years) $2,500,000
RMB ADA Upgrades(5 Years) $3,000,000
Demo Municipal Deck(10-15 Years)$261,600
Replace Municipal Deck(10-15 Years)$14,030,000
RMB Systems Upgrade(15 Years)$32,000,000
OEP Systems Upgrade(20 Years) $19,500,000
Soft Cost$8,750,000
Total
$80,000,000**Cost estimates in today’s dollars.
HVAC / MechanicalLife SafetyPlumbingElectricalElevators
RoofWindows
SYSTEMS UPGRADE
REQUIRED MAINTENANCECURRENT FACILITIES
FISCAL RESPONSIBILITY
• Over $1,000,000 in leasing cost per year, and RISING INCREASED LEASING COSTS
• 45 years is the average age of City-owned buildings downtown MAINTENANCE + ENERGY CONSUMPTION OF AGING FACILITIES
• DUPLICATION of resources• Increased cost of INFRASTRUCTURE
INEFFICIENCIES AND COSTS OF A FRAGMENTED WORKFORCE
INVESTING IN OUR FACILITIESPRESENTS AN OPPORTUNITY
?Duke PerformingArts Center Convention Center& Red Hat Amphitheater Raleigh Union Station
WHAT VISION, PRIORITIES & GOALS HAVE BEEN ESTABLISHED?
DECISION POINT - IMPLEMENTATION
NO-BUILD(STATUS QUO)
BUILD
MASTER PLAN
MASTER PLAN
BUILDNO-BUILD(STATUS QUO)
• SYSTEMS UPGRADE• STRUCTURAL REMEDIATION• ADA • SECURITY
MAINTAIN OUR CURRENT FACILITIES
NO-BUILD(STATUS QUO)
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
Demo Police HQ(5 Years)$171,360
RMB & OEP Security(5 Years) $2,500,000
RMB ADA Upgrades(5 Years) $3,000,000
Demo Municipal Deck(10-15 Years)$261,600
Replace Municipal Deck(10-15 Years)$14,030,000
RMB Systems Upgrade(15 Years)$32,000,000
OEP Systems Upgrade(20 Years) $19,500,000
Soft Cost$8,750,000
COST ESTIMATES
NO-BUILD OPTIONMAINTAINING CURRENT FACILITIES
$80,000,000+Cost estimate in today’s dollars.
TOTAL
• SYSTEMS UPGRADE• STRUCTURAL REMEDIATION• ADA • SECURITY
MAINTAIN OUR CURRENT FACILITIES
• ONE EXCHANGE PLAZA• 310 W MARTIN STREET
LOSS OF TAXABLE REAL ESTATENO-BUILD(STATUS QUO)
2016 Wake County Assessment $4,068,202
Wake County $25,019 per year
City of Raleigh $17,302 per year
Downtown MSD $2,559 per year
TAX ESTIMATE
310 West Martin Street
= $19,861 per year~5% inflation per year.Improvements to property will increase value.
One Exchange Plaza
2016 Wake County Assessment $15,752,356
Wake County $96,877 per year
City of Raleigh $66,995 per year
Downtown MSD $9,908 per year
TAX ESTIMATE
= $76,903 per year~5% inflation per year.Improvements to property will increase value.
310 West Martin Street
One Exchange Plaza +
$5 million +REVENUE
30 YEAR PERIOD
=
• SYSTEMS UPGRADE• STRUCTURAL REMEDIATION• ADA • SECURITY
MAINTAIN OUR CURRENT FACILITIES
• ONE EXCHANGE PLAZA• 310 W MARTIN STREET
LOSS OF TAXABLE REAL ESTATE
• LIMITED OFFICE SUPPLY DOWNTOWN• LEASE RATES CONTINUE TO RISE
LEASING COSTS AS STAFF GROWS
NO-BUILD(STATUS QUO)
DOWNTOWN STAFF - PROJECTIONS
2023 2033 2048
1,130 - 1,160staff
YEAR 5 YEAR 15 YEAR 30
1,050 +/- staff
2018YEAR 0
1,310 - 1,420staff
1,640 - 1,910staff
1.5% - 2.0% historic growth rate
NEW POSITIONSAT 1.5%-2% GROWTH
2023
80 - 110
ADDITIONAL SPACE NEEDEDAT 300 GSF/ PERSON
24,000 SF - 33,000 SF
YEAR 5
CUMULATIVE* LEASE COST
$23/SF at 1.5% INFLATION RATE
$8.0 million - $8.5 million
*Includes existing leased space
DOWNTOWN STAFF - LEASING COSTS
NEW POSITIONSAT 1.5%-2% GROWTH
2023 2033
80 - 110 260 - 365
ADDITIONAL SPACE NEEDEDAT 300 GSF/ PERSON
24,000 SF - 33,000 SF
YEAR 5 YEAR 15
79,000 SF - 109,000 SF
$8.0 million - $8.5 million
$35 million - $41 million
*Includes existing leased space
DOWNTOWN STAFF - LEASING COSTS
CUMULATIVE* LEASE COST
$23/SF at 1.5% INFLATION RATE
NEW POSITIONSAT 1.5%-2% GROWTH
2023 2033 2048
590 - 855
ADDITIONAL SPACE NEEDEDAT 300 GSF/ PERSON
24,000 SF - 33,000 SF
YEAR 5 YEAR 15 YEAR 30
79,000 SF - 109,000 SF
177,000 SF - 256,000 SF
$8.0 million - $8.5 million
$35 million - $41 million
$120 million - $160 million
*Includes existing leased space
80 - 110 260 - 365
DOWNTOWN STAFF - LEASING COSTS
CUMULATIVE* LEASE COST
$23/SF at 1.5% INFLATION RATE
MAINTAIN OUR CURRENT FACILITIES
LOSS OF TAXABLE REAL ESTATE
$80 million +
$120-160 million
$5 million +
30 YEAR OUTLOOK
LEASING COSTS AS STAFF GROWS
NO-BUILD(STATUS QUO)
Estimate in today’s dollars, not at time of renovations.
$200-300MEstimated Total
MASTER PLAN
BUILD
?NO-BUILD
(STATUS QUO)
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
PHASE I
Does not disrupt RMB or Municpal Deck
BUILD OPTIONNEW CITY HALL - PHASE 1
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
NEW CITY HALL
VAR
IES
BUILD OPTIONNEW CITY HALL - PHASE 1
YEAR 2023-2024
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
DEPARTMENTALOFFICE SPACE
VAR
IES
BUILD OPTIONNEW CITY HALL - PHASE 1
PUBLIC FACING FUNCTIONS
BELOW-GRADE PARKING GARAGE
20 STORIES 17 STORIES +/- 14 STORIES +/-
OPTION 1ABOVE CAPACITY
OPTION 2AT CAPACITY
OPTION 3BELOW CAPACITY
20 17 14
20 STORIES
OPTION 1ABOVE CAPACITY
SIZE
1,400 ppl
420,000 SF
CAPACITYAT 300 GSF/ PERSON
Year 203714 YEAR CAPACITY
1.5%GROWTH RATE
Year 20329 YEAR CAPACITY
2.0%GROWTH RATE
CAPACITY DOES NOT INCLUDE PHASE II (RMB or NEW FACILITY)
20
20 STORIES
SIZE
1,400 ppl
420,000 SF
CAPACITYAT 300 GSF/ PERSON
~$190 millionESTIMATED COST
$15.08 / SFEFFECTIVE RENTOVER 30 YEARS
CAPACITY DOES NOT INCLUDE PHASE II (RMB or NEW FACILITY)
OPTION 1ABOVE CAPACITY
20
17+/- STORIES
OPTION 2AT CAPACITY
SIZE
1,200 ppl
360,000 SF
CAPACITYAT 300 GSF/ PERSON
Year 20274 YEAR CAPACITY
1.5%GROWTH RATE
Year 20241 YEAR CAPACITY
2.0%GROWTH RATE
CAPACITY DOES NOT INCLUDE PHASE II (RMB or NEW FACILITY)
17
17+/- STORIES
SIZE
1,200 ppl
360,000 SF
CAPACITYAT 300 GSF/ PERSON
~$165 millionESTIMATED COST
$15.27 / SFEFFECTIVE RENTOVER 30 YEARS
CAPACITY DOES NOT INCLUDE PHASE II (RMB or NEW FACILITY)
OPTION 2AT CAPACITY
17
14+/- STORIES
OPTION 3BELOW CAPACITY
SIZE
1,000 ppl
300,000 SF
CAPACITYAT 300 GSF/ PERSON
-40,000 sf DEFICIT AT MOVE IN
1.5%GROWTH RATE
2.0%GROWTH RATE
-50,000 sf DEFICIT AT MOVE IN
CAPACITY DOES NOT INCLUDE PHASE II (RMB or NEW FACILITY)
14
14+/- STORIES
OPTION 3BELOW CAPACITY
SIZE
1,000 ppl
300,000 SF
CAPACITYAT 300 GSF/ PERSON
~$140 millionESTIMATED COST
$15.55 / SFEFFECTIVE RENTOVER 30 YEARS
CAPACITY DOES NOT INCLUDE PHASE II (RMB or NEW FACILITY)
14
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
etCAPACITY OF NEW CITY HALL HAS IMPLICATIONS FOR PHASING RMB
VAR
IES
PHASE II/III
PHASING IMPLICATIONSPHASE 1
RMBPHASE II
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
Consolidates all downtown staff:
- RMB - OEP - 310 W Martin - Professional Bldg - Briggs Bldg - One City Plaza - new leases
10-15 years of capacity from move in date, 5-6 years from today.
Municipal Deck + new parking provides required spaces.
Uses all floors allowed by zoning.
20 STORIES
OPTION 1 - ABOVE CAPACITY20 STORIES420,000 SF
RMBPHASE II
20
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
Can be entirely vacated.
Reaches end of life ~10 years after Phase I completed.
Systems upgrade, renovations required ifRMB is to be maintained.
Phase I + RMB provides 20-30 years of capacity after Phase I is completed.
Phase I + Phase II tower could provide capacity for 45-61 Years.
Allows flexibilty for use, timeline for starting Phase II.
RMBW/ ABOVE CAPACITY OPTION
Consolidates all downtown staff:
- RMB - OEP - 310 W Martin - Professional Bldg - Briggs Bldg - One City Plaza - new leases
10-15 years of capacity from move in date, 5-6 years from today.
Municipal Deck + new parking provides required spaces.
Uses all floors allowed by zoning.
20 STORIES
OPTION 1 - ABOVE CAPACITY20 STORIES420,000 SF
20
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
Consolidates all downtown staff:
- RMB - OEP - 310 W Martin - Professional Bldg - Briggs Bldg - One City Plaza - new leases
1-4 years of capacity from move in date, 5-6 years from today.
Municipal Deck + new parking provides required spaces.
17 STORIES
OPTION 2 - AT CAPACITY17 STORIES +/-360,000 SF
RMBPHASE II
17
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
Can be entirely vacated.
Phase I + RMB provides 15-25 years of capacity after Phase I is completed.
Phase I + Phase II tower could provide capacity for 45-55 Years.
Phase II would need to start immediately after Phase I.
RMBW/ AT CAPACITY OPTION
Consolidates all downtown staff:
- RMB - OEP - 310 W Martin - Professional Bldg - Briggs Bldg - One City Plaza - new leases
1-4 years of capacity from move in date, 5-6 years from today.
Municipal Deck + new parking provides required spaces.
17 STORIES
OPTION 2 - AT CAPACITY17 STORIES +/-360,000 SF
17
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
50,000 SF short of space needed
Explore alternatives for Phase I consolidation:
RMBPHASE I
DECISION
OPTION 3 - BELOW CAPACITY14 STORIES +/-300,000 SF 14 STORIES
14
OPTION 3 - BELOW CAPACITY14 STORIES +/-300,000 SF
BUILDINGSVACATED
IMPACT
Consolidate all staff on Municpal Block GOAL
All owned and leased except RMB
• Committed to RMB long term.
• Site capacity limited to 9-14 Years
USE RMB
ADDITIONALCOST
$40M RMB Renovations
BUILDINGSVACATED
IMPACT
Consolidate all staff on Municpal Block GOAL
All owned and leased except RMB
• Committed to RMB long term.
• Site capacity limited to 9-14 Years
USE RMB
Maintain flexibility for Phase II.
Only owned property.(RMB, OEP, 310 Martin)
• Staff not fully consolidated in Phase I
• Site capacity to 35-45 Years with Phase II Tower
VACATE RMB
OPTION 3 - BELOW CAPACITY14 STORIES +/-300,000 SF
ADDITIONALCOST
$40M RMB Renovations
Leasing Costs until Phase II Complete
MASTER PLAN
BUILDNO-BUILD(STATUS QUO)
MASTER PLAN
PHASE INO-BUILD(STATUS QUO)
PHASE I HOW MUCH?
~$190M
~$165M
~$140M
ABOVE CAPACITY
AT CAPACITY
BELOW CAPACITY
ABOVE CAPACITY
AT CAPACITY
BELOW CAPACITY
PHASE I HOW MUCH?
~$190M
~$165M
~$140M
9-14 YEARS OF CAPACITY BEFORE PHASE II NEEDED.
1-4 YEARS OF CAPACITY BEFORE PHASE II NEEDED.
USE RMB (+40M Renovations)
VACATE RMB (+ Leasing Costs)
IMPACTS TO CAPACITY
RENOVATE RMB?NOW / LATER?
HOW MUCH?
IMPACTS TO PHASE IIPHASE I
~$190M
~$165M
~$140M
ABOVE CAPACITY
AT CAPACITY
BELOW CAPACITY
PROVIDE GROWTH SPACE?
PHASE I OR II?
CIVIC CAMPUS
PHASE I-II
CITY-OWNED DEVELOPMENT
LEVERAGE PARTNERSHIPS
FULL SITE DEVELOPMENTVISION OF THE MASTER PLAN
Dawson
Harge
tt Stre
et
Morga
n Stre
et McDowell
Nash Square
SITE VALUEPARTNERSHIP OPPORTUNITY
CITY OF RALEIGHDEVELOPMENT
PHASEII
PHASE I
PHASE II
Dawson
Morga
n Stre
et McDowell
Nash SquareH
argett
Street
SITE VALUE - RETURN ON INVESTMENTPARTNERSHIP OPPORTUNITY
PARTNERSHIPDEVELOPMENT
Dawson
Harge
tt Stre
et
McDowell
Nash Square
Morga
n Stre
et
BUILDING VALUE - RETURN ON INVESTMENTEXCESS OFFICE SPACE INCOME
Year 2023 Need
Year 2023 Excess Space
Year 2033 Need
Year 2033 Excess Space
PHASE I - FUNDING SOURCES
SOLD301 Hillsborough St $5,800,000Residence Inn Marriott Site $1,100,000Charter Square $12,800,000
ESTIMATESOne Exchange Plaza ~$13,900,000310 W Martin St ~$4,600,000
$38,200,000
ASSET SALES$38M
SOLD PROPERTY + FUTURE SALES
DEBT CAPACITY$127M
NO IMPACT ONTAX RATE
PHASE I - FUNDING SOURCES
$165MASSET SALES
$38M SOLD PROPERTY +
FUTURE SALES
+ =
DEBT CAPACITY$127M
NO IMPACT ONTAX RATE
PHASE I - FUNDING SOURCES
$165MASSET SALES
$38M SOLD PROPERTY +
FUTURE SALES
+ =
LEASE SAVINGS$35-50M
NEXT 15 YEARS
Projected to fund maintenance costs
COST
BUILDNO-BUILD(STATUS QUO)
$200-300MINCREASES OVER TIME
30 YEAR PERIOD
COST
PHASE I NO-BUILD(STATUS QUO)
$200-300MINCREASES OVER TIME
30 YEAR PERIOD
~$140-190MONE TIME COST
50 YEAR PROJECT
WHAT ARE OUR FIRST STEPS?
DIRECTION FOR PHASE I
AT CAPACITY
~$190M20 STORIES
~$165M17 STORIES +/-
20 17
ABOVE CAPACITY
COMMITTEE ACTIONS
1. Direct Staff of Phase I Implementation Strategy
2. Amend and Approve Master Plan
3. Direct Staff to develop a Public and Employee Engagement Plan
4. Authorize Staff to move forward with Design Services for Phase I
DISCUSSION
Consolidates Downtown staffinto Phase I Building with room for 9-14 years of growth.
Allows RMB to be renovated or redeveloped within a 10 year time frame.
Uses all floors allowed by zoning.
PROS
Consolidates Downtown staffinto Phase I Building with room for 1-4 years of growth.
RMB can be immediately renovated or redeveloped before Phase I meets capacity.
Cost less than Option 1 (any renovations to RMB not included).
PROS
20
17
Highest upfront cost.
Doesn’t use remainder of RMB life (10 years) for core City functions.
CONS
Growth capacity is limited.
RMB or leasing space would be needed soon after Phase I (1-4 years).
Decision and funding for Phase II must follow closely behind Phase I.
CONS
~$190M
ABOVE CAPACITY
OPTION 1
~$165M
AT CAPACITY
OPTION 2