Challenge
CPP North America provides products that help people cope with the challenges of modern life. Their products range from Identity Theft Protection and Gadget Protection to Purchase Protection and Discount Plans that help people get the most out of life. CPP North America is part of CPP Group Plc, a UK-based leading international provider of assistance products and services with over 10 million customers worldwide.
In April 2004, CPP entered into a sixty-six month lease at 5100 Gamble Drive, in St. Louis Park MN, for 43,878 sq. ft. The nature of CPP’s operation changed shortly after lease commencement, leaving a significant portion of their space vacant. CPP engaged ULG Equis’ Workplace Integration and Transaction Management team to analyze CPP’s space needs, develop and implement occupancy cost reduction strategies, achieve necessary tenant improvements, landlord improvements to the building, and to maintain exterior building signage along Highway 100, an important Twin-Cities Highway.
Solutions
UGL Equis’ Workplace Integration team determined that 29,223 sq. ft would accommodate CPP’s operation and that expansion rights would suffice for anticipated growth. The Transaction Advisors engaged the landlord in restructuring discussions regarding the disposition of 14,655 sq. ft., tenant improvements, signage and building improvements, including common area renovations and building entry upgrades.
The team negotiated the lease and secured termination/renewal/expansion options. CPP shed the 14,655 sq. ft. of unneeded space (representing 33% of the obligation) and saved $750,000. In addition, CPP received a generous concession package with $200,000 in tenant improvements, building signage, additional underground parking stalls, and an upgrade to the buildings appearance.
Benefits
· Mitigation of $750,000 in lease obligation
· Alignment of real estate with CPP’s business drivers
· Enhanced building appearance
· Free underground parking
· Exterior building signage
Rory Johnson 10/09/2007
rory@intelligentcre.com
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