Property Appraiser and Property Appraiser and Tax CollectorTax Collector

Office Space Search UpdateOffice Space Search Update

Administrative Services Department

February 25, 2014

• Background• Property Search• Properties Considered• Additional Option• Summary of Options• Tax Collector Proposal• Moving Forward• Summary

Presentation Outline

Background

• BCC currently leases 49,307 SF of office space at SunTrust Center

• Property Appraiser = 31,064• Tax Collector = 18,243

• Lease expires December 2014• Current Cost $1.22 M/Year

• CBRE and REM have conducted a search of available properties for purchase over the last year.

• Utilized criteria provided by the PA and TC which initially did not include requests for additional space beyond the current 49,307 SF.

• Identified approximately 26 properties.

Property SearchProperty Search

Properties ConsideredProperties Considered

• Narrowed the list to 4 options based on location, price, size, parking and improvement costs.

• 2600 & 2611 Technology Drive • 815 Herndon Ave• 320 E. South St. & 501 N. Orange• 250 North Orange

•Additional option for purchase presented by Mr. Randolph at 11-19-13 meeting

• 3670 Maguire Boulevard

Properties Considered

Additional Option

• 3670 Maguire Boulevard

•Consists of 45,000 SF •New owner purchased in December 2013 along with second building of same size for $4.75 M.•Land is on a long term ground lease •Sent LOI in the amount of $6.5m for both buildings and 8 acres of land•Owner countered at $8.3, but stated he really only wanted to sell one building•Buildings have some tenants•Break even is 15 years

Summary of Options

Option 1 (Technology) Property SOLD

Option 2 (Herndon) Extensive renovation, priced above

market, break even minimum 14 years

Option 3 (South St. & Orange Ave) split campus, parking shortfall, size constraints, no

commitment from Orange Ave owner to sell, break even 14 years

Option 4 (250 N Orange) Asking price, inefficient floor

plates, shortage of parking, break even

beyond 30 years

Option 5 (3670 Maguire Boulevard) Asking price, existing tenants, 15 year break even

Tax Collector Proposal

Recently learned the Tax Collector has been negotiating to lease 34,167 SF in year one and then 42,630 SF in years 2 through 10 at 3670 Maguire Blvd. for his – Principal Offices

– Operations

– Support Services

– Tag Office

• $14/SF full service

• Move cost in the $500,000 range

• For 10 year term

Tax Collector Proposal

Issues related to Mr. Randolph’s proposal

– Florida Constitution & State Statutes:• Counties provide Principal office at no charge

(Article VIII § 1)

• Tax Collector has no authority to lease Principal office

• Can lease branch offices for County business only with BCC approval (Board Approved in 1979)

• Cannot use Ad Valorem Taxes for leases over

60 months (F.S. 125.031)

Tax Collector Proposal

Issues related to Mr. Randolph’s proposal

– Not a long term solution

– Had no input from Real Estate

Management or CBRE – Separates Property Appraiser and Tax

Collector Offices

Tax Collector Proposal

Issues related to Mr. Randolph’s proposal

– Indicates Maguire 5 year cost is $2,150,841

– Using the numbers in his chart Maguire 5 year costs amount to $3,410,841

– He deducts $1,575,000 for a reduction of 7 staff through consolidation

Tax Collector Proposal

Issues related to Mr. Randolph’s proposal

– Indicates SunTrust 5 year cost is $3,757,886

• This assumes the reopening of the Winter Park Tag Office that was previously closed by Mr. Randolph on April 4, 2013

• He now says he needs to reopen it if he has to stay in SunTrust

• The 5 year cost for this office is $628,390 ($26.74/SF)

Tax Collector Proposal

Issues related to Mr. Randolph’s proposal

– Also includes $43,800 for employee out of pocket parking not paid by the County

– Includes $184,136 for 5 years of parking paid by the County

– We will actually pay $84,693 for the 5 years or $99,443 less

– The analysis also includes $180,000 for renovations to the Tag office in the Administration Center Parking Garage where they pay no rent

Comparison

Issues related to this proposal - Recap

Mr. Randolph County

5 Year Rent/

Parking $ 3,225,841 $2,929,527

Moving Cost $ 500,000 0

5 Year Total $ 3,725,841 $ 2,929,527

5 Year Savings/Loss $ 796,314

Tax Collector Proposal

Other issues related to Mr. Randolph’s proposal

– Just received Letter of Intent from Mr. Randolph’s office

• Terms are based on a 10 year lease– Ad Valorem taxes may not be used to pay a lease of this

length

• If they leave after 5 years must repay 5 years worth of Tenant Improvements or $630,000

• They have six months of free rent but that begins July 1, 2014.

– We would still be obligated to pay Sun Trust for six months of rent totaling $219,000

Tax Collector Proposal

Other issues related to Mr. Randolph’s proposal

– Tax Collector says he will give space to Property Appraiser in his branch offices

• No Confirmation

• May require additional staff for Property Appraiser

• Don’t know if they have room in branch offices for this proposal

Moving ForwardMoving Forward

• Continue to look for a building(s) to purchase

• Look for other lease options• Cost of move could negate any savings• Not a long term solution

• Discuss renewal options with SunTrust

• Develop a scope and cost estimate for a new building next to Admin.• To house Property Appraiser, Tax

Collector and other County offices currently in leased space (120,00 to 150,000 SF)

• Submit during Budget CIP process

SummarySummary

• Search assumed we want to own not lease because leasing does not solve long-term issue

• Tax Collector not authorized to sign a lease for his Principle office

• Analysis presented by Tax Collector comparing SunTrust and Maguire lease is based on inaccurate and misleading assumptions

SummarySummary

• If BCC decides that leasing is appropriate, REM needs to negotiate the lease and both Property Appraiser and Tax Collector should move to that space

• If BCC decides Property Appraiser and Tax Collector should be in a County owned building, then a short term renewal of SunTrust is appropriate

Property Appraiser and Property Appraiser and Tax CollectorTax Collector

Office Space Search UpdateOffice Space Search Update

Administrative Services Department

February 25, 2014