C&W Negotiations Help Client Realize over $37 Million in Savings
NiSource engaged Cushman & Wakefield in 2007 to initiate an evaluation of its real estate portfolio in order to assess any opportunities that would enhance operational and cost efficiencies in the markets that it served. During this assessment, our team discovered opportunities that included restructuring current leases, relocations to existing buildings that better served space requirements within individual markets, evaluating the feasibility of new construction to accommodate requirements, and engagement in marketing and sale of current assets.
After diligent work within surrounding markets, NiSource’s largest subsidiary, Columbia Gas of Ohio, awarded Cushman & Wakefield the exclusive right to evaluate its 261,621 rentable square-foot headquarters office lease that would expire at the end of 2014. Occupancy was spread out over 14 floors in the building.
Our team facilitated the engagement of architects and developers to work side-by-side with Columbia Gas during the lease negotiation and development process. In evaluating potential opportunities, we performed multiple financial-impact scenarios. Each iteration fully assessed all major financial costs and deal points for each option, providing significant insight for decision makers.
The assignment also involved assessing multiple aspects of Columbia Gas’s current and future space needs and occupancy strategy, which incorporated the organizational structure, adjacencies, new office standards, and space obligations. Cushman & Wakefied also assisted in facilitating a realistic time frame for integration, along with a transition plan for engineering and operations (formerly data/call center), design, and construction. In addition, our team created relocation plans, timelines, budgets, and cost estimates, incorporating key initiatives and goals that would impact long-term real estate decisions and goals such as customer identity, branding, energy efficiency, green building initiatives, and merger agreements.
Columbia Gas decided to relocate to a new Class A LEED-certified development in the highly sought-after Arena District, occupying the final site in the development. The firm was able to lower its office space footprint from 261,621 square feet to 208,000 square feet, while accommodating the same number of employees, incorporating the flexibility to expand operations as needed, and creating a favorable environment for employees.
Cushman & Wakefield successfully negotiated the delivery of a LEED-certified base building and shell. In negotiating with developers and the current landlord, our team effectively leveraged the market to achieve a final rental rate that is more than 25% lower than that of other anchor tenants in adjacent properties. Furthermore, by leveraging adjacent municipalities, over $10 million in city incentives was realized. From initial proposals to final taking terms, Columbia Gas realized over $37 million in savings through negotiations handled by Cushman & Wakefield.