A Terminal Transaction. A Terminal Transaction – Exterior Renovation Terminal Tower.
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A Terminal Transaction
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Transcript of A Terminal Transaction. A Terminal Transaction – Exterior Renovation Terminal Tower.
A Terminal Transaction
A Terminal Transaction – Exterior Renovation
Terminal Tower
A Terminal Transaction – Exterior Renovation
A $10B Real Estate Company with a National Footprint
A Terminal Transaction – Exterior Renovation
The Union Terminal circa 1930
A Terminal Transaction – Exterior Renovation
34th Floor Cornice
A Terminal Transaction – Exterior Renovation
Floors 34 - 52
A Terminal Transaction – Exterior Renovation
The Union Terminal Rehab
A Terminal Transaction – Exterior Renovation
A Terminal Transaction – Exterior Renovation
• Pic of original ramp
Original Ramp Configuration
A Terminal Transaction – Exterior Renovation
Without Original Ramps
If we had to keep the ramps
A Terminal Transaction – Exterior Renovation
• Pic of redone ramps with sloping ceilings
Reconfigured Ramp
A Terminal Transaction – Exterior Renovation
• Pics of Interior 7
Interior shots of Retail Center
A Terminal Transaction – Exterior Renovation
The Tower Rehab - 2005
A Terminal Transaction – Exterior Renovation
Something’s Missing
A Terminal Transaction – Exterior Renovation
A Terminal Transaction – Exterior Renovation
OUCH!
A Terminal Transaction – Exterior Renovation
Before & After with Fiberglass Replacement
A Terminal Transaction – Exterior Renovation
15th Floor Cornice – “Before”
A Terminal Transaction – Exterior Renovation
Cornice Elements Removed, New Steel
A Terminal Transaction – Exterior Renovation
Finished Product.
Cornice Elements made of Fiberglass
A Terminal Transaction – Exterior Renovation
Challenges
• DEFINING THE BUILDING FOR SUBSTANTIAL REHABILITATION TEST PURPOSES
• WORKING AROUND SECURITIZED DEBT ALREADY IN PLACE
A Terminal Transaction – Exterior Renovation
Defining the Building
Existing complex components owned by different Forest City entities.
In 3 dimensions, components jut in and out of the space directly under the office tower.
The property master leased to the historic Lessee is only the office tower.
Didn’t include the mall space in “building”.
A Terminal Transaction – Exterior Renovation
Defining the Building (cont’d)
Definition of the building for Rehab Test purposes cuts off the office tower at ground level.
The “building” for purposes of the test is comprised of all or part of various components.
Easements were put in place to permit access through space owned by others to the office tower.
A Terminal Transaction – Exterior Renovation
The DebtSecuritized debt placed with Bear Stearns.
Virtually no wiggle room as to its terms. Loan “security” cannot be in any way compromised.
It took months of back and forth with the servicer to craft a deal.
One example:
Loan terms require that rent checks from tenants go into a lock-box controlled by the servicer. Servicer would then pull out debt service and remit remaining funds to building management company to pay bills.
Lessee must collect the rents, make lease payments, and operate as a legitimate separate entity.
Solution was to create additional lock-box at Lessee level.
A Terminal Transaction – Exterior Renovation
The Players
Developer: Forest City Enterprises, Inc
Investor: Morgan Stanley
Syndicator: Consortium Structured Investments
Developer Counsel: Squire Sanders and DempseyLead by Steve Mount
Investor Counsel: Nixon PeabodyLead by David Schon and Dan Kolodner
Financial Projections: Reznick Group, IncLead by Jo Ann Clipp
