Improving Florida S Real Estate Lease Procurement Process

Improving Florida’s Real Estate Lease Procurement Process

Welcome to our new and improved Leasing Guidelines. You will find everything you need within this publication to procure rental space for the State of Florida. Your role is vital in the partnership established between your Agency, the Department of Management Services and our Tenant Broker Representative, The Staubach Company. Our combined knowledge of the State of Florida’s core services and mission as well as real estate knowledge will continue to add value and reduce costs for Florida tax payers.

We look forward to your input. Please do not hesitate to contact us with suggestions and general comments about this publication. For your convenience, we are making this publication available on our official web page at

Ron Goldstein, General Services Manager

Bureau of Real Property Management

BUREAU OF REAL PROPERTY MANAGEMENT

LEASING CONTACT INFORMATION

Name / Expertise / Telephone No.
SC:
Fax No. / Email
Christine Brandon / Records Management / PH: 850-488-6680
SC: 278-6680
Fax: 850-488-6687 /
Ronald Goldstein / All Leasing Policies
Technical Assistance / PH: 850-488-3759
SC: 278-3759
Fax: 850-488-6687 /
Lisa Lehman / Data – Reports / PH: 850-488-9244
SC: 278-9244
Fax: 850-488-6687 /
Chuck Moneyham / Private Sector Leasing
Technical Assistance / PH: 850-488-9256
SC: 278-9256
Fax: 850-488-6687 /
Glenn Tedcastle / Private Sector Leasing
Technical Assistance / PH: 850-488-6478
SC: 278-6478
Fax: 850-488-6687 /

DEPARTMENT OF MANAGEMENT SERVICES

TENANT REPRESENTATIVE

STAUBACH CONTACT

NAME / EXPERTISE / CONTACT INFORMATION / EMAIL
Blair Bryan
(Carolina & Florida) / President, Staubach
Carolinas & Florida / PH: 704-943-2300
Fax: 704-943-2301
Cell: 704-905-2970 /
Larry Barninger
(Orlando) / Vice President
Central Florida / PH: 407-902-2617
Fax: 407-839-3880
Cell: 407-948-6919 /
Peter Brohoski
(Washington DC) / Vice President, Staubach Education & Municipal Services / PH: 202-639-4552
Fax: 202-783-6602
Cell: 202-669-0735 /
Blair Bryan
(Carolina & Florida) / President, Staubach
Carolinas & Florida / PH: 704-943-2300
Fax: 704-943-2301
Cell: 704-905-2970 /
Harriet Buck
(Virginia) / Vice President, Staubach Education & Municipal Services / PH: 703-287-0459
Fax: 703-448-6685
Cell: 410-869-4624 /
Clarissa Dunlap
(Tallahassee) / Business Manager
North Florida / PH: 850-893-7100 x111
Fax: 850-386-4957
Cell: 850-264-4228 /
John Gibb
(Washington DC) / Sr. Vice President, Staubach Education & Municipal Services / PH: 202-639-4553
Fax: 202-783-6602
Cell: 703-472-3850 /

DEPARTMENT OF MANAGEMENT SERVICES

TENANT REPRESENTATIVE

STAUBACH CONTACT

(Continued)

Dawn Givens
(Tallahassee) / Asst. Account Manager
North Florida / PH: 850-893-7100
Fax: 850-386-4957
Cell: 850-570-2072 /
Scott Goldstein
(Miami) / Account Manager
South Florida / PH: 305-446-9877
Cell: 305-968-8854 /
Mark Haney
(Tallahassee) / Director, Corporate Services
North Florida / PH: 850-893-7100 x113
Fax: 850-386-4957
Cell: 850-508-7979 /
David Hulsey
(Tallahassee) / Manager, Institutional Leasing
North Florida / PH: 850-893-7100
Fax: 850-386-4957
Cell: 850-545-4990 /
Peter Larkin
(Washington DC) / Sr. Vice President, Principal
Staubach Education &
Municipal Services / PH: 202-639-4551
Fax: 202-783-6602
Cell: 202-669-7267 /
Laura Malone
(Orlando) / Associate
Central Florida / PH: 407-902-2619
Fax: 407-839-3880
Cell: 407-538-2586 /
Michael McShea
(Washington DC) / Sr. Vice President Principal Staubach Education & Municipal Services / PH: 202-639-4550
Fax: 202-783-6602
Cell: 202-669-2580 /
Jon Pertchik
(Boca Raton) / Sr. Vice President &
Managing Principal
South Florida / PH: 561-944-9794
Fax: 561-241-3248
Cell: 561-504-8617 /
Collins Proctor
(Tallahassee) / Sr. Vice President & Managing Principal
North Florida / PH: 850-893-7100 x112
Fax: 850-386-4957
Cell: 850-322-9763 /
Katie Proctor
(Tallahassee) / Controller/Financial Advisor
North Florida / PH: 850-893-7100
Fax: 850-386-4957
Cell: 850-445-3128 /
Mark Stratman
(Orlando) / Sr. Vice President &
Managing Principal
Central Florida / PH: 407-902-2620
Fax: 407-839-3880
Cell: 407-448-1351 /
Doreen Tamayo
(Tallahassee) / Sr. Account Manager
North Florida / PH: 850-893-7100 x110
Fax: 850-386-4957
Cell: 850-322-3728 /
Daniel Wagnon
(Tallahassee) / Sr. Associate
North Florida / PH: 850-893-7100 x115
Fax: 850-386-4957
Cell: 850-766-2271 /
Ernest Watkins
(Tallahassee) / Manager, DCCS
North Florida / PH: 850-893-7100 x114
Fax: 850-386-4957
Cell: 850-228-6789 /
Danielle Vennett
(Boca Raton) / Associate
South Florida / PH: 561-994-9794
Fax: 561-241-3248
Cell: 561-254-4351 /

GLOSSARY OF TERMS

ACKNOWLEDGMENT - a formal declaration before a duly authorized person, such as a notary public, to the effect that the person executing the instrument is performing his free act and deed and that the signature is genuine.

ADA (Americans with Disabilities Act) - laws prohibiting discrimination against persons with disabilities.

ADDENDUM - a supplement or addition to a lease.

AFFIDAVIT - a written declaration made under oath before an official, as a notary public.

AMENITY - a feature or convenience that increases the attractiveness or value of a piece of property.

APPURTENANCE - a right, privilege, or property considered incidental to the principal property for purposes such as passage of title, conveyance, or inheritance.

ASSIGNMENT - a transfer of a claim, right or interest in property.

COMPETITIVE SOLICITATION – means an invitation to bid, a request for proposals, or an invitation to negotiate.

COVENANTS - binding clauses in a lease which define rights and obligations of lessor and lessee.

DEED - a legal document conveying title to real estate.

DISCOUNT RATE - an annual percentage which represents the required return on the capital invested in a depreciating asset, such as a building.

ENERGY PERFORMANCE INDEX - a measure describing the energy consumption of a facility expressed in BTU’s per square foot per year.

ESCALATION CLAUSE - a clause in an agreement providing for adjustment of a price, rent, or interest rate.

EXCULPATORY CLAUSE - a mortgage clause relieving the borrower(s) of personal liability to repay a loan.

EXISTING FACILITY - to be considered existing, the proposed space must be enclosed with a roof system and exterior walls in place.

EXTENSION - an agreement by which an existing lease is made effective on specified terms for an additional period of time.

FTE - full-time employee.

GROSS AREA - the sum of the floor areas included within the outside faces of exterior walls for all stories, or areas, which have floor surfaces.

HOTELING - equipped office space available on a reservation basis for use by multiple employees, who are not in the office on a daily basis.

INTERSTITIAL SPACE - that portion of the gross area which cannot be put to use because of the presence of structural or service features of the building.

LEASE - a legal contract between the lessee and lessor providing for the possession and use of a specified property or square footage.

LESSEE - a tenant under a lease.

LESSOR - owner of record or duly authorized representative of real property who has the power and authority to make a lease.

LIEN - a legal hold or claim which a person or entity has upon the property of another as security for some debt or charge.

MECHANICAL AREA - a portion of a building designed to house mechanical or electrical equipment.

MODIFICATIONS - changes to the standard lease agreement that change the terms of the original lease.

NET ASSIGNABLE AREA - the sum of all areas on all floors of a building assigned to, or available for assignment to, an occupant, including every type of space functionally usable by an occupant.

PHYSICAL DETERIORATION - depreciation of property due to wear and tear and the action of the elements.

PREMISES - property which is leased, i.e., a building or any part thereof.

RADON GAS - a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present a health risk to persons exposed to it over a period of time.

RECEIVER - a person or entity appointed by the court to manage a property being foreclosed.

RECOMMENDED ORDER - the official recommendation of a hearing officer of the Division of Administration.

RENEWAL OPTION - a lease covenant giving the lessee the right to extend the lease for an additional period of time on specified terms.

REQUEST FOR PROPOSAL - the method of competitive solicitation utilized by the state in seeking space to lease.

SUBORDINATION - a lender permitting a debt due him to be subordinated or inferior to the debt of another lender on the same property.

SUBORDINATION CLAUSE - a mortgage clause indicating the lender’s interest in the property has a lower priority than that of another lien holder.

SUBROGATION - the substitution of one party for another in a claim, lien or cause of action against others.

TERM - the specified duration of the lease.

USEABLE SQUARE FEET – measured in accordance with the Standard Method for Measuring Floor Area in Office Buildings, BOMA/ANSI Z65.1-1996.

GENERAL INFORMATION

The following information is provided to clarify terms and procedures covered in the chapters of the leasing manual.

1. Responsibilities:

A.Agency: Determine and justify space need and procure the most cost-effective space in accordance with the statutes and the procedures set forth in this document. Prepare leases and related documents.

B.Department of Management Services (DMS), Bureau of Real Property Management: To administer the State of Florida’s Real Property Lease Management Program, establish criteria for lease procurement, administer leases for state-owned DMS managed facilities, provide authorization to solicit competitive bids for leased space, review and approve leases for 5,000 square feet or more, review and file leases under 5,000 square feet, and provide technical assistance and training to agencies in all aspects of lease procurement.

2. These statutes, rules and regulations are applicable in the procurement of leased space:

A.Section 20, Florida Statutes - Organizational structure of the various agencies of state government.

B.Chapter 83, Florida Statutes - Landlord and Tenant Act.

C.Chapter 120, Florida Statutes - Administrative Procedures Act.

D.Chapter 253, Florida Statutes - State Lands.

E.Chapter 255, Florida Statutes - Public Property and Publicly Owned Buildings.

F.Section 267.061, Florida Statutes – Historic Properties, state policy, responsibility.

G.Section 267.061, Florida Statutes - Recycling.

H.Chapter 4A-3, Florida Administrative Code - Fire Prevention, General Provisions.

I.Chapter 10-22, Florida Administrative Code. Utilization of Minority Business Enterprises.

J.Chapter 60D-4, Florida Administrative Code. Rules for construction and leasing of state buildings to insure energy conservation.

K.Chapter 60D-5, Florida Administrative Code. Procedures for construction, contract bidding and award, negotiation and changes.

L.Chapter 60D-7, Florida Administrative Code. Minimum codes for state construction under the jurisdiction of the Department of Management Services

M.Chapter 60D-10, Florida Administrative Code. Public Facilities Conversion.

N.Chapter 60D-11, Florida Administrative Code. Procedures and requirements of Alternate Energy and Life Cycle Cost Analysis Programs for state-owned and leased facilities.

O.Chapter 60D-12, Florida Administrative Code. Physical and operational security for state-owned computer rooms.

P.Chapter 60H-1, Florida Administrative Code. Leases for real property.

Q.Chapter 60H-2, Florida Administrative Code. Space allocation in state-owned office building and privately-owned building.

R.Chapter 60H-4, Florida Administrative Code. Parking

S.Chapter 60H-5, Florida Administrative Code. Smoking policies in state office buildings.

T.Chapter 60H-6, Florida Administrative Code. Use of State Buildings.

U.Chapter 60H-7, Florida Administrative Code. Florida facilities pool.

V.Chapter 60H-8, Florida Administrative Code. Flags at half-mast.

3.Insurance: Refer to Department of Insurance, Division of Risk Management publications for information regarding insurance for leased facilities.

4.Service categories: There are four basic types of office space that the state leases:

A.Full Service. As part of the lease, the lessor provides utilities and janitorial services.

B.Full Service Less Janitorial. Utilities are furnished but not janitorial services.

C.Full Service Less Utilities. Janitorial services are furnished but not utilities.

D.No Services. Neither utilities nor janitorial services are provided by the lessor.

5.Rental Rate Guidelines: DMS has established the maximum rental rates for each category of service for specific areas in the state.

6.Private sector lease numbering system: Lease numbers are assigned by DMS and indicate the leasing agency and category of lease.

A.The lease numbers are comprised of seven digits. (example 590:1959)

1.The first three numbers designate the agency and are issued by the comptroller.

2.The last four digits designate the category of leased space and the sequential lease number within an agency.

B.The agency designation and the lease number are separated by a colon.

C.The three categories indicated by the lease number are:

1.Lease numbers sequenced from 0 through 7999 identify private sector leases.

2.Lease numbers from 8000 through 8999 identify turnkey leases.

3.Lease numbers from 9000 through 9999 identify nominal or no consideration leases.

4.For example, the lease number above, 590:1959, identifies the lease as a DCF private sector existing space lease. The lease number 590:9001 identifies a DCF nominal or no consideration lease.

Accessibility For The Physically Handicapped

1.Chapter 255.21, Florida Statutes, requires that any facility intended for use by the general public which is constructed or leased by a state agency, state board or other authority must be in compliance with Section 553.48, Florida Statutes.

2. Section 553.48, Florida Statutes, charges the Department of Community Affairs with the responsibility of preparing a manual which fully explains the requirements of the American National Standards Institute (ANSI) and Part V of Chapter 553, Florida Statutes.

3.The American National Standards Institute standard publication A117.11986 titled MakingBuildings and Facilities Accessible to and Usable by Physically Handicapped People is the national standard for accessibility.

4.To comply with this statute, the Florida Board of Building Codes and Standards of the Department of Community Affairs has prepared the Accessibility Requirements Manual.

5.As a part of the process of obtaining a lease or a modification to increase the square footage of a lease, the lessor is to be made aware of the need for adherence to the handicap accessibility requirements.

6.All requests for information or questions concerning accessibility for the physically handicapped should be directed to the Florida Board of Building Codes and Standards of Department of Community Affairs.

Processing Documents

Documents sent to DMS for processing or filing should be accompanied by a transmittal sheet or cover letter. The following is an example of a transmittal sheet:

Date

Mr. Ron Goldstein, C.P.M.

General Service Manager

Department of Management Services

Building 4050, Suite 315

4050 Esplanade Way

Tallahassee, Florida32399-0950

Re:Lease number:

Division:

Location:

Dear Mr. Goldstein:

Enclosed are the following for processing:

Lease Document: New Renewal Modification No.

Market Quotes

Disclosure Statement

Certification of Compliance

Floor Plans

Copy of Invitation to Negotiate

Change of Ownership or Payee

Renovation/Construction Plans

Other:

Contact person for this Lease: Phone #

Sincerely,

Facilities Service Manager

Enclosure (s)

Agency’s Signature Authority

DMS will not approve documents unless the signatures have been previously authorized with form FM 4106 (written delegation of authority must accompany documents submitted during the absence of the authorized agency person). The following form gives specific personnel the authority to sign lease documents:

STATE OF FLORIDA

DEPARTMENT OF MANAGEMENT SERVICES

AGENCY’S AUTHORIZED SIGNATURE AUTHORITY

PLEASE LIST ALL PERSONS AUTHORIZED TO SIGN THE FOLLOWING DOCUMENTS:

CERTIFICATE OF COMPLIANCE

LEASE AGREEMENT, MODIFICATIONS, RENEWALS AND CANCELLATIONS

REQUEST FOR PRIOR APPROVAL OF SPACE NEED

TENANT - AT - WILL

______

DEPARTMENT

______

NAME AND TITLE

______

SIGNATURE

______

DATE

FM 4106 (R05/04)

STANDARD METHOD OF SPACE MEASUREMENT

Building Owners and Manager Association International (BOMA) Standard

The purpose of this standard is to permit communication and computation on a clear and understandable basis. Another important purpose is to allow comparison of values on the basis of a generally agreed upon unit of measurement (usable square footage).

It should also be noted that this standard can and should be used in measuring office space in old as well as new buildings, leased office space as well as state-owned space. It is applicable to any architectural design or type of construction because it is based on the premise that the area being measured is that which the agency may occupy and use for its furnishings and its people.

This standard method of measuring office space measures only occupiable space, undistorted by variances in design from one building to another. It measures the area of office building that actually has usable (rental) value and, therefore, as a clear understanding of what is being measured. Area measurement in office buildings is based in all cases upon the typical floor plans, and barring structural changes which affect materially the typical floor, such measurements stand for the life of the building, regardless of readjustments incident to agency layouts.

All usable office space, private sector leased, state-owned, or other publicly-owned shall be computed by the methods on the following page.

PREPARING FLOOR PLANS AND SQUARE FOOTAGE CALCULATIONS

1.Floor plans verifying the net usable square footage must be submitted with new leases or modifications to increase or decrease square footage on leases 5,000 square feet or greater. This requirement may be met by using either a scaled line drawing or an architect's blueprint. The plans must contain all dimensions and calculations following the standard method of space measurement, necessary to compute the net usable square footage. They should be signed by the person who physically measured the leased premises.

2.Floor plans should be prepared and square footage calculations completed before lease documents are completed. The square footage on the floor plans and the lease document must agree.

3.Drawings are to be clear with measurement lines showing to which surface of the wall the measurement applies. Many times an architect's drawing will not indicate measurements to surfaces as required in the standard method of space method measurements procedure. In such cases measurement lines and distances may be drawn on the floor plans to make them correct.

4.Square footage calculations must be clear and easy to follow. For clarity areas of the facility may be designated with an alpha letter which is referenced to the calculations. Areas may be color coded if desired to make them easier to understand.

5.Any subsequent lease actions which change the square footage must be accompanied by a new set of plans indicating the total new square footage.

CALCULATION OF SQUARE FOOTAGE

1.Set calculator to three decimal places.

2.Calculate all measurements to three decimal places using the decimal equivalents provided as shown on the following page.

3.Do not round off any figures used in calculations until final square footage is obtained, then round off to nearest square foot to arrive at net rentable square footage for the facility.

DECIMAL EQUIVALENTS FOR SQUARE FOOTAGE CALCULATIONS

(To be used for ALL square foot calculations)

1/4" = .021 / 6" = .500
1/2" = .042 / 61/4" = .521
3/4" = .063 / 61/2" = .542
1" = .083 / 63/4" = .563
11/4" = .104 / 7" = .583
11/2" = .125 / 71/4" = .604
13/4" = .146 / 71/2" = .625
2" = .167 / 73/4" = .646
21/4" = .188 / 8" = .667
21/2" = .208 / 81/4" = .688
23/4" = .229 / 81/2" = .708
3" = .250 / 83/4" = .729
31/4" = .271 / 9" = .750
31/2" = .292 / 91/4" = .771
33/4" = .313 / 91/2" = .792
4" = .333 / 93/4" = .813
41/4" = .354 / 10" = .833
41/2" = .375 / 101/4" = .854
4/3/4" = .396 / 101/2" = .875
5" = .417 / 103/4" = .896
51/4" = .438 / 11" = .917
51/2" = .458 / 111/4" = .938
53/4" = .479 / 111/2" = .958
113/4" = .979

The State Fire Marshal has asked that all plans submitted to his office be clearly identified as new lease or a modification of an existing lease. If the plans are for a new lease, the inspector will automatically go out and inspect the property before it is occupied. Renovations should not begin until the State Fire Marshal has approved the plan.