FY2019 Portfolio report

FY 2019
STATE PROPERTIES COMMISSION

PORTFOLIO REPORT

real property real solutions

CREDITS: The Fiscal Year 2019 State Properties Commission Portfolio Report is published on behalf of the State Property Officer and Executive Director of the Commission, Marty W. Smith. Written, compiled, and edited by Morgan Smith-Williams, Frank Smith, Andre Elam, Clark Wong, Russell Morgan, Jamiel Jones, and Lindsey Sprewell. LAYOUT AND DESIGN: Sherry Britt, Georgia Building Authority PRINTING: Fast Printing, Inc.
2

FY 2019

TABLE OF CONTENTS

2About the Commission 3Leadership 4Year in Review 5Portfolio Summary 12 Buildings Portfolio 16Space Portfolio 19Lease Portfolio 30Land Portfolio 32Spotlight: CSX Lease

2019 portfolio repor t

1

about the commission
The State Properties Commission (SPC) was created in 1964, under Governor Carl Sanders, to aid the State of Georgia with acquiring and disposing of State-owned real property and real property interests.
With the creation of the State Property Officer under Governor Sonny Perdue, as well as legislation through the 2005 Georgia General Assembly that realigned the management of the State's capital assets, the State Properties Commission was designated as Georgia's real estate portfolio manager. As such, the Commission's primary focus is to provide accountability in the stewardship of the State's Real Property Assets for the citizens of Georgia.
Since 2005, SPC is in charge of increasing the utilization and efficiency of workplace environments, executing lease and land transactions on behalf of State agencies, and maximizing the value of the State's assets.

SPC
State Properties Commission
REAL PROPERTY REAL SOLUTIONS

Vision
To be the national leader in State real estate portfolio management by exemplifying stewardship, accountability and integrity.
Mission
To advise, guide and maximize Georgia's real estate portfolio by applying industry best practices in asset, space and transaction management.
Values
Stewardship Accountability Integrity Leadership

2

2019 ABOUT THE COMMISSION

leadership

Board Members
Governor Brian Kemp Board Chairman
Alan Skelton State Accounting Officer, Board Vice Chairman
Brad Raffensperger Secretary of State, Board Secretary
Lynne Riley State Treasurer, Board Member
S. Michael Howell Citizen Member appointed by Speaker of the House Karl Lutjens Citizen Member appointed by Lieutenant Governor Phil Carlock Citizen Member appointed by the Governor

State Properties Commission

Marty Smith State Property Officer Executive Director, SPC
Gerald Pilgrim Chief of Staff
Lisa Sharpton Director, Human Resources
April King Chief Financial Officer

Frank Smith Deputy Executive Director
Clark Wong Land Manager
Morris Srochi Leasing Manager
Russell Morgan Asset Manager

Alisa Pereira Director, Legal Services

Alan Perry Chief Technology Officer

Morgan Smith-Williams Director, Marketing & Communications

2019 leadership

3

year in review

Marty Smith State Property Officer Executive Director, State Properties Commission

As the State's real estate portfolio manager, our charge is to find ways to derive the most value out of our assets. In Fiscal Year 2019, the State Properties Commission planted the foundation for investments decades into the future.
The Commission successfully negotiated a new agreement with CSX Corporation authorizing their continued use of the Western & Atlantic Railroad, valued at $1.2 billion over a 50-year lease period, starting January 1, 2020. Railroads are a major part of Georgia's freight infrastructure, and the Port of Savannah and the Hartsfield-Jackson Atlanta International Airport both depend on Georgia's railroads to ship goods into the interior of the country. CSX's operation of the Western & Atlantic Railroad generate $1.1 billion in public benefits and supports approximately 1,800 jobs yearly. We were also proud to have supported the efforts to revitalize the area where Atlanta was born as the terminus of the Western & Atlantic railroad line. The Commission successfully marketed and sold a 9.3-acre tract in Atlanta's Gulch area to developer CIM Group, which is strategically important to the $5 billion Centennial Yards project.
Our continuous improvement means agencies can rest assured that the Commission is prepared to support their growth through unmatched expertise and customer service. The Governor's and the Legislature's support of multi-year contracting allows the agencies to receive the best market rental rates in fact, the State avoided over $54 million in costs during this fiscal year.
Recent hurricane activity has had a devasting effect on Georgia's prized beaches; in order to protect and prevent future damage to coastal structure, the Commission granted mineral leases at both Sea Island and Tybee Island for beach nourishments. Beach nourishment replaces sand that is lost through erosion. By creating a wider beach with new sand, it becomes possible to prevent future damage to coastal structures. The new sand interacts with the waves in the surf zone to reduce the impact of very high tides and storm surges.
Through Governor Kemp's strong leadership, we are leading our industry through innovation and will continue to make significant strides to support Georgia's growth for years to come.

Frank Smith Deputy Executive Director, State Properties Commission

4

2019 year in review

FY 2019

PORTFOLIO SUMMARY

Overview Highlights Revenue Assets by County

2019 portfolio summ ary

5

overview

The State Properties Commission is organized in four distinct divisions: Space Management, Asset Management, Land, and Leasing.

Space Management Division
Space Management maximizes the utilization of space to create efficient work environments. SPC has developed space standards based on industry and public sector criteria to accomplish the following objectives:
Increase occupancy
Decrease vacancy
Improve the value of State owned and leased space
Provide the most cost-efficient work space for State entities
Asset Management Division
The strategic function that manages the State's real estate assets to provide the maximum value to the State. The Asset Management Division (AM) is responsible for collaborating with agencies to develop 4-year real property plans based on staff projections, budget, existing locations and operational plans. Additionally, AM maintains the State's real property database (BLLIP); provides project management on select SPC deals and evaluates space utilization of leased and owned space.

Land Division
All acquisitions or dispositions of the State's real property must come through SPC. The Commission assures that all acquisitions and dispositions of land in the State's name meet the legal, policy, and process requirements of the State. Properties owned by the Board of Regents are excluded. Acquisitions into the State include fee simple interests, conservation easements, access and other easements, and ground leases. Dispositions from the State include temporary revocable licenses, permanent easements, short or long-term ground leases and fee simple conveyances.
Leasing Division
SPC offers an array of leasing services to State entities in commercial or state-owned leased space. Services range from locating and procuring new lease locations to renewing or renegotiating existing agreements, as well as managing the State's lease inventory. The Division's responsibilities and functions include leasing assistance to State entities in both State and commercially owned facilities.

6

2019 PORTFOLIO SUMMARY

2019 highlights

14,802Total Buildings in the portfolio
10,037 State of Georgia 3,487 Board of Regents 1,095 Georgia Department of Transportation 183 Community Service Boards
2,277Total Leases in the portfolio
1,189 SPC Managed 709 Agency Managed 379 Board of Regents Managed

830,320
Total State owned and leased acres of land

$36,696,547,714
Total insured value of buildings in portfolio

Mackey Branch Waterfall

2019 portfolio summ ary

7

revenue

Chart Title SPC RevenueRCevoenluleeCcoltleectded vs.ExSpePndCiturEesxpenditures
$12,680,212

$9,651,202

$9,063,222

$1,852,190
2017

$1,980,614
Chart Title 2018
Revenue Collected Expenditures

$1,980,614
2019

Total revenue collected and deposited into State treasury vs. total expenditures.
Includes staff, surveys, appraisals and other operating expenses.

$12,680,212

type of revenue

Breakdown of Revenue Collected$9i,3n67F,8Y062019 by Type

94% 1% 5%

Land Leases
$9,651,202
Easements & Revocable License Agreements
Sales

AMOUNT
$7,814,484.43 $454,700.00 $794,037.70

8

$1,827,657

$1,852,190

$1,980,614

2019 PORTFOLIO SUMMARY

assets by county

The following totals include the Department of Transportation, Board of Regents, and Community Service Boards.

County Appling Atkinson Bacon Baker Baldwin Banks Barrow Bartow Ben Hill Berrien Bibb Bleckley Brantley Brooks Bryan Bulloch Burke Butts Calhoun Camden Candler Carroll Catoosa

Number Number

of

of

Buildings Leases

33

8

6

5

18

7

4

5

521

70

13

2

196

8

179

18

30

9

29

6

272

53

68

6

10

3

9

4

87

11

185

49

62

9

162

9

33

1

83

9

17

3

143

28

19

7

Total State Owned Acreage 4,973.37 4,534.10 19.23 6,449.27 5,301.46 3,332.42 1,859.15 2,851.23 42.26 9,040.96 2,325.72 631.22 6,714.10 4.63
23,035.60 3,673.91
10,088.40 1,373.60 6,836.32 5,688.07 16.30 766.75 47.64

Total State Leased Acreage 0.00 0.00 0.00 0.00 1.22 0.00 0.00 3,455.00 0.00 0.00 0.00 4,304.74 0.00 0.00 2.00 0.00 0.00 0.00 0.55 0.00 0.00 0.00 0.00

Total State Owned
& Leased Acreage 4,973.37 4,534.10
19.23 6,449.27 5,302.67 3,332.42 1,859.15 6,306.23
42.26 9,040.96 2,325.72 4,935.96 6,714.10
4.63 23,037.60 3,673.91 10,088.40 1,373.60 6,836.87 5,688.07
16.30 766.75
47.64

County

Number Number

of

of

Buildings Leases

Charlton

62

7

Chatham

487

56

Chattahoochee

6

4

Chattooga

98

5

Cherokee

14

15

Clarke

709

45

Clay

65

8

Clayton

127

36

Clinch

22

4

Cobb

141

44

Coffee

117

19

Colquitt

63

11

Columbia

133

12

Cook

41

10

Coweta

73

17

Crawford

10

3

Crisp

169

12

Dade

89

6

Dawson

102

5

Decatur

88

15

DeKalb

357

138

Dodge

100

12

Dooly

47

2

Total State Owned Acreage 37.63 33,487.87 4.48 1,299.20 40.52 5,214.62 545.09 501.17 337.02 869.43 5,334.59 1,755.71 137.45 633.10 2,803.17 2.23 1,562.91 3,560.56 21,765.14 8,930.56 3,628.76 610.45 3,457.37

Total State Leased Acreage 145.00 0.00 0.00 0.00 9,213.70 36.42 0.00 0.00 0.00 0.00 0.00 0.00 2,871.70 0.00 0.00 0.00 0.00 3.00 0.00 17,023.00 0.00 0.00 0.00

Total State Owned
& Leased Acreage
182.63 33,487.87
4.48 1,299.20 9,254.22 5,251.03
545.09 501.17 337.02 869.43 5,334.59 1,755.71 3,009.15 633.10 2,803.17
2.23 1,562.91 3,563.56 21,765.14 25,953.56 3,628.76
610.45 3,457.37

2019 portfolio summ ary

9

County Dougherty Douglas Early Echols Effingham Elbert Emanuel Evans Fannin Fayette Floyd Forsyth Franklin Fulton Gilmer Glascock Glynn Gordon Grady Greene Gwinnett Habersham Hall Hancock Haralson Harris Hart Heard Henry

Number Number

of

of

Buildings Leases

118

48

78

12

62

10

4

2

14

10

153

10

122

18

40

5

13

5

3

15

205

18

31

13

179

6

381

124

23

10

4

2

236

32

82

10

15

5

27

10

103

83

156

8

156

82

44

4

16

5

183

4

60

8

2

3

42

17

Total State Owned Acreage 16,520.62 2,060.63 2,346.34 4.01 5,800.44 232.93 9,843.27 421.57 18.73 3.15 4,036.24 141.55 497.28 1,478.52 2,971.30 3.86 32,557.14 1,339.74 58.56 2,601.21 585.70 1,470.09 2,099.59 895.34 102.72 12,165.97 986.65 903.22 127.99

Total State Leased Acreage 0.00 0.00 0.00 0.00 843.00 1,527.72 1,634.12 3.00 0.00 0.00 0.00 0.00 393.12 5.23 2,141.60 0.00 1.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4,746.38 0.00 9,999.56 0.00

Total State Owned
& Leased Acreage 16,520.62 2,060.63 2,346.34
4.01 6,643.44 1,760.65 11,477.39
424.57 18.73 3.15
4,036.24 141.55 890.40
1,483.75 5,112.91
3.86 32,558.74
1,339.74 58.56
2,601.21 585.70
1,470.09 2,099.59
895.34 102.72 16,912.35 986.65 10,902.78 127.99

County Houston Irwin Jackson Jasper Jeff Davis Jefferson Jenkins Johnson Jones Lamar Lanier Laurens Lee Liberty Lincoln Long Lowndes Lumpkin Macon Madison Marion McDuffie McIntosh Meriwether Miller Mitchell Monroe Montgomery Morgan

Number Number

of

of

Buildings Leases

122

27

19

2

7

3

73

4

24

5

22

9

72

3

44

2

35

7

54

18

25

4

88

22

59

7

29

8

73

7

29

3

223

47

108

27

64

2

45

2

24

1

57

8

219

5

159

10

12

4

54

12

185

14

56

1

190

5

Total State Owned Acreage 15,814.16 7,192.05 806.07 6,142.62 10,314.83 741.41 3,802.11 203.25 235.11 282.74 16.64 9,193.53 890.40 913.69 3.86 25,301.89 3,172.60 668.45 1,148.62 1,500.71 10,313.86 637.05 62,868.36 15,094.60 4,687.49 1,687.70 2,025.63 114.08 6,078.78

Total State Leased Acreage 0.00 0.00 0.00 0.00 0.00 0.34 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 669.00 0.00 0.00 0.00 0.00 0.00 0.00 12,539.00 0.00 654.05 0.00 6.84 0.00 0.00 0.00

Total State Owned
& Leased Acreage 15,814.16 7,192.05
806.07 6,142.62 10,314.83
741.75 3,802.11
203.25 235.11 282.74
16.64 9,193.53
890.40 913.69 672.86 25,301.89 3,172.60 668.45 1,148.62 1,500.71 10,313.86 13,176.05 62,868.36 15,748.65 4,687.49 1,694.54 2,025.63 114.08 6,078.78

10

2019 PORTFOLIO SUMMARY

County Murray Muscogee Newton Not Georgia Oconee Oglethorpe Paulding Peach Pickens Pierce Pike Polk Pulaski Putnam Quitman Rabun Randolph Richmond Rockdale Schley Screven Seminole Spalding Stephens Stewart Sumter Talbot Taliaferro Tattnall

Number Number

of

of

Buildings Leases

134

8

210

62

84

9

62

0

68

9

32

3

50

14

123

9

17

5

12

4

35

5

26

9

52

2

235

8

1

4

96

4

13

7

349

31

56

24

3

2

30

9

63

4

146

31

26

11

74

2

174

24

25

4

97

1

414

13

Total State Owned Acreage 3,712.12 1,960.55 988.95 1,519.09 1,565.81 391.42 15,368.81 2,892.76 154.88 2.00 566.71 3,465.93 6,153.86 15,641.28 2.00 5,050.52 17.91 1,952.07 1,247.61 2.21 2,149.97 3.86 1,085.53 61.10 6,697.93 1,904.78 13,946.12 2,357.42 13,988.93

Total State Leased Acreage 22.68 0.00 0.00 0.00 0.00 0.00 75.50 0.00 0.00 2.37 0.00 0.00 2.90 0.00 0.00 0.00 0.00 5.30 110.53 0.00 11,457.60 2,892.07 0.00 0.00 0.00 0.00 1,198.42 0.00 0.00

Total State Owned
& Leased Acreage 3,734.80 1,960.55
988.95 1,519.09 1,565.81
391.42 15,444.31
2,892.76 154.88 4.37 566.71
3,465.93 6,156.76 15,641.28
2.00 5,050.52
17.91 1,957.37 1,358.15
2.21 13,607.57
2,895.93 1,085.53
61.10 6,697.93 1,904.78 15,144.54 2,357.42 13,988.93

County Taylor Telfair Terrell Thomas Tift Toombs Towns Treutlen Troup Turner Twiggs Union Upson Walker Walton Ware Warren Washington Wayne Webster Wheeler White Whitfield Wilcox Wilkes Wilkinson Worth TOTALS

Number Number Total State

of

of

Owned

Buildings Leases Acreage

Total State Leased Acreage

Total State Owned
& Leased Acreage

28

3 2,760.41

0.00 2,760.41

53

5 11,998.35

0.00 11,998.35

22

5

93.15

2.69

95.84

85

28 4,249.88

0.00 4,249.88

332

25 4,218.76

0.00 4,218.76

63

15 5,780.90

80.44 5,861.34

60

1

503.53

0.00

503.53

24

4 2,920.33

0.00 2,920.33

54

19 1,609.76

0.00 1,609.76

21

4

33.14

0.00

33.14

9

4

313.17

206.45

519.61

138

9

317.44

866.51 1,183.95

62

9

370.79 1,294.11 1,664.90

95

15 22,805.42

0.00 22,805.42

41

6

468.45

0.00

468.45

268

18 31,167.59

5.05 31,172.64

6

3

3.00

0.00

3.00

129

13 1,591.49

0.00 1,591.49

69

11 21,334.12

3.03 21,337.15

4

4 4,363.93

0.00 4,363.93

120

1 8,461.08

0.00 8,461.08

218

5 2,069.64 5,599.96 7,669.60

72

17

231.94

0.00

231.94

44

2

317.47

0.00

317.47

33

8

39.36 8,005.00 8,044.36

14

3 1,946.60

0.00 1,946.60

7

4 1,195.69

0.00 1,195.69

14,802 2,277 726,268.88 104,051.49 830,320.37

2019 portfolio summ ary

11

FY 2019

BUILDINGS PORTFOLIO

Highlights
Agencies with Most Square Footage for Owned Buildings
Top Primary Use Types for State Owned Buildings
Breakdown of State Owned Buildings by Age

12

2019 buildings PORTFOLIO

2019 highlights
SPC is responsible for the acquisition and disposition of all state buildings and for maintaining a comprehensive inventory of all owned buildings in the portfolio; their size, use and other key criteria.
Each agency
is responsible for the maintenance and operation of state buildings in their custody
The state-owned building portfolio consists of
14,802
buildings

Department of Revenue, Albany

2019 buildings PORTFO LIO

13

STATE OWNED BUILDINGS
Top 10 Agencies with Most Gross Square Footage for Owned Buildings

SQ FT
80,041,502.93

1

13,761,235.00

2

13,033,990.00

3

7,625,236.86

4

7,047,820.07

5

SQ FT
4,836,825.00

6

4,771,469.00

7

4,424,737.50

8

4,391,153.00

9

10 3,120,098.00

14

2019 buildings PORTFOLIO

STATE OWNED BUILDINGS

Top 10 Primary Use Types for State Owned Buildings

Use Type

BUILDINGS

1 Warehouse, storage, shop, maintenance 2 Residence, house, apartment, dormitory 3 Classroom, faculty, library, training 4 Office 5 Comfort station, bathhouse, welcome center 6 Student services, recreation, event, entertainment 7 Land 8 Laboratory 9 Athletic facility 10 Medical, clinical

4,758 1,433 1,067
965 411 308 262 246 227 183

21-30 Years 41-50 Years

0-20 Years 31-40 Years 51 Years and Over

Breakdown of State Owned Buildings by Age

23%
0-20 Years

17%
21-30 Years
13% 31-40 Years

50% Over 40
Years

37%
51 Years and Over

11% 41-50 Years

2019 buildings PORTFO LIO

15

FY 2019

SPACE PORTFOLIO

Highlights
Primary Use Type Requests
Space Action Request Types
Space Standards for Administrative Office Space
Comparison of Georgia's Space Standards to Public & Private Sector

16

2019 space PORTFOLIO

2019 highlights

SPC's Space Management Division offers a full range of professional space planning services to State entities in meeting their space needs.

For those State entities submitting requests for administrative space, Space Management not only develops space utilization programs to determine square footage requirements, but also prepares schematic floor plans and design intent drawings that can steer workspace layout and construction.
In FY 2019, the SPC Commission received 936 space requests from state agencies. The use and transaction types of space requested are illustrated in the two charts below.

Percentage by Primary Use Type Requests Submitted to SPC During FY 2019

Use Type

percentage

Administrative/Office Classroom/Faculty Offices Classroom/Training Rooms Towers Warehouse/Storage Other Uses

81% 4% 2% 5% 1% 7%

Received and processed 936 space action requests from State agencies

Percentage of Space Action Request Types Submitted to SPC During FY 2019

4 %

2 %

4 %

NNeew w

52%

RReenengoetigatoiontiation

RReenenwealswals

CCaancnelclaetiolnlation

OOthtehr er

38%

New Renegotiation Renewals Cancellation Other

2019 space PORTFOLIO

17

space standards

Space Standards for Administrative Office Space
SPC tracks the square footage per employee in leased space to drive efficiency in space utilization. The chart illustrates the average square footage of space per employee from 2014 to 2019.
*Space standards were revised in 2015. **Includes circulation and common space.

500

400

300

288

200

100

0
2014

*Space Standards were revised in 2008, 2012, 2014 & 2015*

353

302

300

244

292

2015*

2016

2017

2014 2015 2016 2017 2018 2019

2018 **

2019

Comparison of Georgia's Space Standards to Public & Private Sector (in square feet)

Georgia Virginia Kansas Massachusetts GSA (Federal) Private Sector Corporate

office
120-220 SF 120-196 SF 110-400 SF 100-200 SF 250-300 SF 120-225 SF

CUBICLE
49-64 SF 48-96 SF 45-100 SF 42-100 SF 64-200 SF 20-48 SF

18

2019 space PORTFOLIO

FY 2019

LEASE PORTFOLIO

Highlights Total Leases Multi-Year Leases Cost Avoidance with Multi-Year Leases Executed Multi-Year Leases Key Performance Indicators

2019 LEASE Portfolio

19

2019 highlights

The leasing of administrative space for use by State entities is also within the purview of SPC. The Leasing Division provides management and oversight of the State's leased property portfolio, as well as leasing assistance to State entities in both State and commercially owned facilities.

Lease portfolio consists of
2,277
leases, of which SPC manages 1,189
Multi-year lease agreements' cost avoidance was over
$54M
for FY 2019

379 709

1,189

FY 2019 Total Leases
SLePSasCPesCLMLeaneaaagsesedesbsy SPC AAggAeengcney MncaycnyaMgMeadaLnenaaasgegseedd BBooBaraodraodfrRdoegofefnRtsReeggeennttss
Managed Leases
SPC completed 16 new multi-year lease agreements in FY 2019

20

2019 lease PORTFOLIO

MULTI-YEAR LEASES
Since the ratification of the Constitutional Amendment in November 2012, which authorized SPC to enter in Multi-Year Leases (MYLs), SPC and the Georgia State Financing and Investment Commission (GSFIC) work together to safeguard Georgia's AAA credit rating. For FY 2019, GSFIC set a total MYL contract obligation limit of $215 million.

In FY 2019, SPC executed 16 multi-year leases that together, totaled 563,035 rentable square feet.
SPC's total contract obligation is $161,664,159, and the agency has avoided $53,689,780 in costs.

Department of Revenue, Albany

Department of Revenue, Albany

Department of Human Services, Canton Department of Human Services, Canton

2019 LEASE Portfolio

21

MULTI-YEAR LEASES

Cost Avoidance With Multi-Year Leases
Cost avoidance by the state year over year since gaining the MYL ability.

$49,454,000

$49,266,000

$53,689,780

$32,706,900

$6,574,600

Department of Family and Children Services, DeKalb

2015

2016

2017

2018

2015 2016 2017 2018 2019

2019

22

2019 lease PORTFOLIO

FY 2019 executed multi-year leases

Entity
Department of Banking and Finance

Sub-Entity N/A

Square Feet
2,800

City Dublin

County Landlord Laurens Southern Loan and Investment Company

Department of Human Services Division of Family & Children Services 11,522 Cordele Crisp

Perlis Realty Company

Department of Juvenile Justice N/A

3,200 Dublin

Laurens Southern Loan and Investment Company

Department of Human Services Division of Family & Children Services 112,731 Atlanta DeKalb FDS Georgia I, LLC

Department of Human Services Division of Family & Children Services 49,000 Marietta Cobb

The Center for Children & Young Adults

Department of Revenue

N/A

11,805 Albany

Dougherty Indusa Beverage, Inc.

Department of Human Services Division of Family & Children Services 27,337 Carrollton Carroll

Carroll County Board of Commissioners

Office of the Secretary of

N/A

State of Georgia

12,466 Atlanta Cobb

Interstate NW Owner, LLC

Department of Behavioral

N/A

Health & Developmental

Disabilities (Amendment)

0 Cumming Forsyth 1230 Bald Ridge Marina, LLC

Department of Human Services
Georgia Vocational Rehabilitation Agency Department of Human Services Department of Human Services Department of Driver Services Technical College System of Georgia Department of Human Services Department of Human Services Department of Human Services (Amendment) Total

Division of Family & Children Services N/A
Division of Aging Division of Family & Children Services N/A N/A
Division of Child Support Services Division of Family & Children Services Division of Child Support Services

26,958 5,983
15,678 32,850 128,272 92,640

Tifton
Warner Robbins Valdosta Canton Conyers Atlanta

Tift Houston
Lowndes Cherokee Rockdale DeKalb

5,664 24,129
0

Covington Covington Carrollton

Newton Newton Carroll

563,035

Tift County Board of Commissioners BY OS, LLC
GF Valdosta Mall, LLC Efficient Governement Public Service, Inc. Zephyr Holdings, LLC Clairmont Place Partners, LLC
Tango Mike, LLC Tango Mike, LLC WHLR-Riverbridge Shopping Center, LLC

2019 LEASE Portfolio

23

KEY PERFORMANCE INDICATOR

Department of Human Services Division of Child Support Services and Aging Services
Consolidation and Co-location

Consolidation and Co-location with No Additional Operating Expense Pass Throughs
The Opportunity
For over a decade, Child Support Services and Aging Services have occupied multiple separate administrative offices and training spaces. Co-locating these divisions will maximize space utilization while addressing the needs for additional operational space and staff growth. Through SPC's competitive RFP process, Valdosta Mall presented a cost effective option that satisfies the requirement from both an economic and size perspective. This former Sears box store will be converted into office space.
The Process
Due to the lack of available office product in the city of Valdosta, the only other proposals received were either too small, or required new construction, which resulted in unfavorable (over budget) economics. The decision to relocate to Valdosta Mall was in part due to the convenient and well-known location, as well as the proposed renovation of former Sears box into brand new office space. This newly converted space will allow the agency to proactively plan its space configuration. This results in increased efficiencies, lower costs, and greater product quality. The result of this proposed lease will be a fully functional, modern office space for the two divisions, allowing them to share common areas, whilst maintaining autonomy from one another in client-facing capacities.

Lease #8376
Address 1700 Norman Drive Valdosta, GA 31601
Space Use Office/Administration
Square Footage 15,678 RSF
Lease Term 180 months
Savills Services Transaction Management Project Management

24

2019 lease PORTFOLIO

KEY PERFORMANCE INDICATOR

Department of Human Services Division of Child Support Services and Aging Services
Consolidation and Co-location

Financial Details
The lease will have a flat rate structure of $22.66 per rsf with 1.65% annual escalations.
The general terms and conditions are highlighted below: Approximately 15,678 rsf Fifteen (15) year lease term $22.66/per rsf modified gross rental rate, with 1.65% annual escalations No additional operating expense pass throughs Turnkey renovations and base building improvements valued at over $1.1 million
The terms outlined above represent a below market deal while still including over an estimated $1,100,000 in additional Tenant Improvements to upfit the space to the agency standards for a turnkey buildout.

The current full service retail market rate, including tenant improvement allowance, in Valdosta is $24.38 per rsf. The cost savings and cost avoidance are detailed below:
Savings in DHS CSS & AS Rental Rate vs. Market Rental Rate/RSF $1.72
Total Cost Avoidance: DHS CSS & Aging vs. Market ($22.66/RSF vs. $24.38 RSF) $583,990.49
* a 3% annual market escalation
Estimated Value of Turnkey Improvements (@ $75.00/RSF) $1,100,000
*Turnkey buildout (inclusive of base building improvements and TI)

2019 LEASE Portfolio

25

KEY PERFORMANCE INDICATOR

Technical College System of Georgia
Lease Renewal

The Opportunity & Process
TCSG has occupied approximately 87,849 rsf of office space located at 1800 Century Place, NE, Atlanta, Georgia 30345 since 2004 under a multiyear lease between the landlord and Georgia Building Authority (GBA). TCSG wishes to continue their tenancy as the location serves them well and the property is well maintained. TSCG has requested SPC enter into a new lease on their behalf which would allow for improvements to the premises, including an expansion of 4,791 rsf in order for TCSG to occupy the entire building. Entering into a twelve-and-a-half-year lease will enable the landlord to complete all necessary tenant improvements to update and expand the premises.

Lease #9127
Address 1800 Century Place, NE Atlanta, GA 30345
Space Use Office/Administration
Square Footage 92,640 RSF
Lease Term 150 months
Savills Services Transaction Management

26

2019 lease PORTFOLIO

KEY PERFORMANCE INDICATOR

Technical College System of Georgia
Lease Renewal

Financial Details
The lease will have a rate structure of $19.06 per rsf with an annual average escalation of 3.0%.
The general terms and conditions proposed by Clairmont Place Partners, LLC are highlighted below:
At lease commencement, tenant shall occupy approximately 87,849 rsf
Premises will expand to include an additional 4,791 rsf beginning July 1, 2020 or when the landlord obtains a Certificate of Occupancy.
Twelve and a half (12.5) year lease term
$19.06 per rsf full service rental rate with 3% escalation of the base rate for fiscal year 2020.
Upon Commencement of the expansion space which is anticipated July 1, 2020, tenant will pay $21.10 per rsf full service with two (2%) percent annual escalations over the remaining term.
Tenant will only pay for actual increases in taxes and insurance over a 2019 base year capped at 105% over the previous year.
Landlord to provide and pay for painting, new flooring and moving expenses associated therewith.
Tenant improvement allowance of $35.00 per rsf on the additional 4,791 rsf area

The current full service office market rate, including tenant improvement allowance, in North DeKalb is $30.00 per rsf. The cost savings and cost avoidance are detailed below:
Year 1 Per RSF Savings in DHS DFCS Full Service Rental Rate vs. Market Full Service Rental Rate ($29.79/ RSF vs. $30.89/RSF) $10.941
Total Lease Term Cost Avoidance: DHS DFCS Full Service Rental Rate vs. Market Full Service Rental Rate ($29.79/RSF vs. $30.89/RSF) $12,402,8852,3
Notes:
1 Savings shown for the first year of the lease.
2 Cost avoidance shown is for the difference between the $30.00 current market rent, with 3% annual increases, and the rent under proposed lease over a term of 12.5 years.
3 A 3% annual increase applied to the current market rent as a commonly accepted industry standard.

2019 LEASE Portfolio

27

KEY PERFORMANCE INDICATOR

Department of Revenue - Alcohol and Tobacco Unit
Expansion and Lease Negotiation

Expansion with Concessions and Tenant Improvements
The Opportunity
DOR currently occupies 5,094 rsf of office space at 1105-D West Broad Avenue in Albany, GA. DOR needs to expand their office space to accommodate increased employee headcount and customer foot traffic, to expand the Alcohol and Tobacco unit and to add a regional training facility. The current landlord cannot provide expansion space for the agency. In January, 2018, SPC advertised a Request for Proposal (RFP) to relocate DOR. Three (3) proposals were received, and the selection committee visited the properties in February, 2018. In April, 2018, the selection committee selected Indusa Beverage, Inc. as the apparent awardee.
The Process
Due to the nature of the Albany market, most existing office spaces in the market are in old buildings that have not been renovated to modern standards. The Indusa Beverage, Inc. building is already slated for conversion to office, and the Landlord has already underwritten the majority of the shell conversion as part of its redevelopment plan for the property. Other existing product in the market would require significantly more improvement to meet minimum shell requirements for the State. The result of this proposed lease will be a fully functional, modern office space for the agency in a well located building that is easily accessed by constituents and agency personnel.

Lease #8348
Address 735 N Westover Blvd., Suite A Albany, GA 31707
Space Use Office/Administration
Square Footage 11,805 RSF
Lease Term 120 months
Savills Services Transaction Management Construction Management

28

2019 lease PORTFOLIO

KEY PERFORMANCE INDICATOR

Department of Revenue - Alcohol and Tobacco Unit
Expansion and Lease Negotiation

Financial Details
The lease will have a flat rate structure of $20.75 per rsf with no annual increase.
The general terms and conditions of the Indusa Beverage Inc. proposal are highlighted below: Approximately 11,805 rsf Ten (10) year lease term $20.75 per rsf modified gross (net of janitorial services) rental rate with no annual
increase Landlord is providing base building improvements of $221,510.00 ($18.76/SF) and
TI valued at $818,849.00 ($69.36/SF)
The terms outlined above represent a below market deal while still including an estimated $405,000.00 in additional TI to upfit the space to agency standards for the turnkey buildout.

The current modified gross market rate for office space in Albany is $22.70 based on an estimated $35.00 per RSF market Tenant Improvement package. The cost savings and cost avoidance of the DOR deal versus the current market are detailed below:
Savings in DOR Rental Rate vs. Market Rate Rental/RSF $1.95 / RSF
Total Cost Avoidance: DOR vs Market ($20.75 /RSF vs. *$22.70 /RSF) $230,175.69
*Rate is based on the average rental rate of a ten year term with a 3% annual market escalation
Estimated Value of Tenant Improvements $1,040,359.00
*Turnkey buildout (inclusive of base building improvements and TI)

2019 LEASE Portfolio

29

FY 2019

LAND PORTFOLIO

Highlights
Board Approved Items
Spotlight: CSX Lease
Legislative Approved Items
Other Approved Items
General Assembly Approved Surplus/Conveyance Completed Items

30

2019 land portfolio

2019 highlights

SPC is responsible for approving all acquisitions or dispositions of the State's real property. The Land Division assures that all acquisitions and dispositions of land in the State's name meet the legal, policy, and process requirements of the State.

SPC Board approved
52
items in FY 2019

SPC Board Meeting Approved Items

Other Items

11 5

Disposition-Short Term Lease 1

5

Disposition-Approve Sale

10 8

General Assembly approved
28
properties for Surplus/Conveyance in FY 2019

Reversion-Quit Claim Deed
Acquisitions-Ground Lease
Acquisitions-Easements Acquisitions-Conservation
Easements

3 4
2 2
6 4
2 3

2018 2019

Acquisitions-Fee Simple

21

25

2019 land portfolio

31

SPOTLIGHT: Csx LEASE

32

A new, 50-year lease agreement with CSX for the continued use of the state-owned Western & Atlantic railroad continues to derive significant economic impact for the State of Georgia.
The lease will generate $1.2 billion to the State Treasury, which is $509 million more than the previous leasing agreement.
2019 SPOTLIGHT

the western & atlantic railROAD

At approximately 1,550 acres and 137.33 miles, the Western & Atlantic Railroad was completed in 1850 and runs through several counties in Georgia and even enters Hamilton County, Tennessee. The Southeastern Terminus of the Western & Atlantic Railroad (W&A) later led to the creation of Atlanta. Since then, the W&A has been a tremendous aid to the economic growth of the State and its position as the hub of the South.
With authorization and support of the Georgia General Assembly through Act 71 (Senate Resolution 228) in 2017, the State Properties Commission negotiated with CSX Corporation (CSX), a new lease agreement permitting their continued use of the W&A. The original lease executed in 1969 and later amended in 1986 will be replaced with a new lease for 50 years beginning January 1, 2020.
CSX's operation of the W&A generates an additional $1.1 billion (NPV) in public benefits and supports approximately

1,800 jobs yearly. Operation of the line also diverts 362,053 cargo trucks off Georgia's interstates yearly--which equates to almost 1,000 cargo trucks daily.
The value of the lease payments to the State of Georgia total approximately $1.2 billion over a 50-year lease period. This is an increase of $509 million over the current lease agreement.
In addition to monetary consideration, CSX will also convey a 50-year lease to the Georgia Department of Transportation, allowing GDOT to ensure existing fiber lines running from the Traffic Management Center to Highway 75/85 and I-20 remain undisturbed. "The successful renegotiation of this long-term lease represents multiple benefits for the residents of Georgia," said Carol Comer, Director of the Division of Intermodal for the Georgia Department of Transportation (GDOT). "In addition to the long-term positive fiscal impact this lease brings, it also allows us to extend our fiber optic cable network, helping the Department to better manage our transportation network overall."
For most Georgians, the most exciting benefit of the new lease is the conveyance of 2.3 miles of unused rail to extend the Silver Comet Trail. The Silver Comet Trail is a 61-mile-long (non-motorized) trail in northwest Metro Atlanta. "This acquisition will allow for growth of the Silver Comet Trail and will offer new opportunities for recreation in Georgia," said Mark Williams, Commissioner of the Georgia Department of Natural Resources. "Runners, cyclists, and outdoor enthusiasts of all kinds will now have more access to our State's natural beauty and one of-a-kind attractions that make Georgia the best place in the country for outdoor recreation."

2019 SPOTLIGHT

33

Legislative Approved Items
Comparison of number and type of conveyance presented to the General Assembly.

Easements

Conveyances-To Sell

2

0

Conveyances-To Local

Government or GDOT

5

Conveyances-

4

Ground Lease

4

1

Conveyance-Exchange

2

Conveyance-Expedited

6

11 11
10

2018 2019

Other Approved Items
Comparison of number and type of additional transactions completed by SPC staff.

29 Title Certifications
Executive Orders
RLA's-SPO Approved
CE Appraisal Reviews Approved
CE Appraisal Reviews-In Process

13 12
11 12
11

18
20 28
19 23

2018 2019

34

2019 land portfolio

General Assembly Approved Surplus/Conveyance: Completed

This table includes all fully executed conveyances completed in FY2019; however, General Assembly approval may have occurred prior to the beginning of the fiscal year.

Agency County TCSG Henry

DNR TCSG SPC DOC DNR DJJ SPC TCSG

Clay Bulloch Cobb Richmond Jeff Davis Baldwin Bartow Columbia

DOC DOC DBHDD
TCSG

Tattnall DeKalb Chatham
Hall

TCSG GFC

Dougherty Wayne

GPSTC DHS GFC DNR DPS SPC SPC TCSG

Monroe Cherokee Cherokee Hall Clarke Various Glynn Washington

Tract Name Portion of Henry County Campus of Southern Crescent Tech Portion of George T. Bagby State Park Portion of Ogeechee Tech Portion of WARR Portion of Augusta State Prison Portion of Bullard Creek WMA Milledgeville YDC Portion of WARR Portion of Grovetown-Columbia Campus of Augusta Technical College Portion of Rogers State Prison Portion of Metro State Prison Portion of Savannah Regional Hospital
Portion of New Hall County Campus of Lanier Technical College Total Acreage
Portion of Albany Technical College
Wayne County Unit
Total Acreage
GPSTC Training Center
DHS Cherokee
Walesa Tower Site
Portion of Lake Lanier State Park
Athens Hanger
WARR
Sea Island Beach Renourishment
Portion of TCSG Campus

Acres 1.91

Consideration Nominal

Grantee Snapping Shoals EMC

0.534 0.06
0.267 0.21
3.956 0.12 0.32 0.63

Nominal Nominal $5,400 Nominal Nominal Nominal Nominal $7,331

Georgia Transmission Corporation Excelsior Electrical Membership Corporation Georgia Department of Transportation Georgia Department of Transportation Georgia Department of Transportation Baldwin County, Georgia City of Emerson Georgia Power Company

11.146 0.23
0.0351
0.217

Nominal $4,900 Nominal
$6,800

Atlanta Gas Light Company Blackhall Studios Chatham County, Georgia
Tribe Transportation, Inc.

19.64

$24,431

Total Easement Conveyances

0.64

Property

City of Albany

1

Property

Wayne County, Georgia

1.64

Total Exchange/Settlement Conveyances

$5,000/annually Justice Federal Credit Union

5 Improvements Efficient Government Public Service, Inc.

0.03

Nominal

Cherokee County Board of Commissioners

1.32

Nominal

City of Gainesville

0.74

Nominal

Georgia Aviation Authority

1,550 $1,008,333.33/mth CSX Transportation, Inc.

$444,150

Sea Island Acquisition, LLC

Nominal

Washington County Board of Commissioners

Conveyance Type Easement
Easement Easement Easement Easement Easement Easement Easement Easement
Easement Easement Easement Easement
9 Exchange Exchange 2 Lease Lease Lease Lease Lease (Assignment) Lease Lease (Mineral) Lease

2019 land portfolio

35

Agency County TCSG Decatur

SPC

Chatham

GFC

Morgan

GFC

Burke

GFC

Schley

TCSG
TCSG
DEcD DOA DJJ SPC DOD GFC DOA DNR DOA

Hall
Hall
Fulton Muscogee Baldwin Fulton Dougherty Lincoln Hall Rockdale Chatham

DBHDD Baldwin

DOD

Baldwin

DNR

Rabun

GFC

Brooks

DOC

Jackson

DOL

Coffee

Tract Name Decatur County Campus of Southern Regional Technical College Tybee Island Beach Renourishment Total Acreage Apalachee Tower Site The Chief Ranger Residence Schley County Unit Total Acreage Oakwood Campus of Lanier Technical College
Portion of Hall County Campus of Lanier technical College Hotel Site Columbus Farmers Market Milledgeville YDC GULCH Tract Albany Armory Lincoln County Unit Oakwood Poultry Lab Poynter Reservoir Black Shoals Park Portion of Savannah State Farmer's Market
Portion of Central State Hospital Campus
Portion of Milledgeville Readiness Center
Portion of Tallulah Gorge State Park Brooks County Unit I.W. Davis Probation Detention Center DOL Office

Acres
1557.09 0.25 0.5 0.5 1.25
41.188 6.55
7.2457 14.57 5.7 9.367 4.5 0.453 10.73 405.1 0.048
329.442 0.468
0.303 2
13.81 0.83

Consideration Nominal Nominal
Nominal Nominal Nominal
Nominal Nominal Nominal Nominal Nominal $15,000,000 Nominal Nominal Nominal Nominal $8,700
Nominal $63,500
Nominal Nominal Nominal $150,000

Grantee Board of Regents of the University System of Georgia City of Tybee Island
Total Lease Conveyances
M.H. Cochran, his heirs, successors, or assigns
Board of Commissioners of Burke County, Georgia
L.S. Tondee, their heirs, successors, or assigns
Total Reversion Conveyances
Board of Regents of the University System of Georgia City of Gainesville

Conveyance Type Lease
Lease (Mineral) 1 Reversion Reversion Reversion 3 Sale
Sale

Geo L. Smith II World Congress Center Authority Columbus Consolidated Government Baldwin County, Georgia 30 Spring St. (Atlanta) Fee Owner, LLC Dougherty County, Georgia Lincoln County Board of Commissioners City of Oakwood, Georgia Rockdale County, Georgia Georgia Department of Transportation
Central State Hospital Local Redevelopment Authority Georgia Department of Transportation
Town of Tallulah Falls, Georgia Brooks County, Georgia Jackson County, Georgia Seven Acres Properties, LLC

Sale
Sale
Sale
Sale
Sale
Sale
Sale
Sale
Sale ($8,238 General Treasury; Remainder to Agency for Site Improvements) Sale
Sale ($35,413 General Treasury; Remainder to Agency for Cost to Cure and Site Improvements) Sale
Sale
Sale
Sale*

* Proceeds retained by the Department of Labor, not deposited in Treasury.

36

2019 land portfolio

Photos Courtesy of: Cover Tybee Island Beach/City of Tybee
Page 7. Mackey Branch Waterfall/Matthew Moore Page 13. Albany, Department of Revenue/Greg Walker, Houser Walker Page 21. Albany, Department of Revenue/Greg Walker, Houser Walker Page 21. Canton, Department of Human Services/Michael-Chase Eaton,
Aerial Photography Inc. Page 22. DeKalb, Department of Family and Children Services/Don Chandler Page 24. Valdosta, Department of Human Services Division of Child Support
Services and Aging Services/Savills Studley

Page 25. Valdosta, Department of Human Services Division of Child Support Services and Aging Services/Savills Studley
Page 26. Atlanta, Technical College System of Georgia/Savills Studley Page 29. Albany, Department of Revenue/Greg Walker, Houser Walker Page 32. Western and Atlantic Railroad, CSX/Georgia Ports Authority Page 33. Western and Atlantic Railroad, CSX/Georgia Ports Authority Page 34. Canooche Sandhills/Department of Natural Resources

Digital copies of this publication and prior reports are available at www.spc.ga.gov. Find the State Properties Commission on the web: www.spc.ga.gov
Building, Land, and Lease Inventory of Property (BLLIP): www.realpropertiesgeorgia.org



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SPC
State Properties Commission
REAL PROPERTY REAL SOLUTIONS
270 Washington Street, Suite 2-129 Atlanta, Georgia 30334
www.spc.ga.gov
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