Corstone Capital and one of their portfolio companies, Astra HR had their headquarters in an older, inefficient property with few amenities available for the employees. Their annual rent expense was low due to the secondary location and building quality, which made any increased cost of a possible relocation an important consideration. The ability to recruit new employees to support the anticipated growth was going to be an important factor in any new building selection. The balance was to achieve benefit versus cost.
Consideration & Analysis
Serten Advisors worked with the executive team to identify opportunities that met the extensive criteria established during the early vision and strategic planning sessions. Properties were toured, RFP’s submitted and a shortlist of three final candidate properties was created for parallel negotiations. A potential renewal in their current space was viewed as a low cost alternative and was weighed against the relocation alternatives by occupancy cost, operational efficiencies, commuting drive times and employee work/life quality.
A renovation plan was created for the existing facility, along with a detailed construction/FF&E budgets for each of the relocation alternatives. This analysis was coupled with the lease terms negotiated with the shortlist landlords, enabling Corstone to understand the capital and long-term lease costs of the selected alternatives.
Corstone signed a long term lease for a full floor comprising of 25,979 square feet in a multi-building office campus. The negotiating leverage created by Serten resulted in significant economic incentives, including a long period of base rent abatement, generous buildout allowance, new emergency generator, bathroom and common area renovations, top of building signage and free parking for the first four years. The space accommodated Corstone’s current and long term space requirements in a consolidated, highly efficient environment.