IRES Helps Client Save $2.8 Million
February 2010 – IRES partners with client, Invensys, to help them save millions by negotiating an early lease renewal at their 127,000-square foot corporate headquarters.
Who are Invensys’ clients?
Invensys’ clients are some of the world’s most important industrial organizations — large oil refineries; chemical, gas, LNG, power, pharmaceutical and mineral processors; food and beverage companies; metals and mining companies; water and wastewater facilities; pulp and paper mills — and its solutions deliver significant cost benefits associated with the secure, efficient operation of industrial plants and facilities. Invensys Operations Management (“IOM”) is a newly created division of Invensys that combines the Wonderware, Triconex, Foxboro, SimSci/Esscor and Eurotherm business units into a single operating entity.
Assignment & Challenge
IRES was exclusively selected to assist Invensys relative to its 127,000 square-foot IOM / Wonderware corporate headquarters lease negotiation and renewal in South Orange County, CA. Invensys’ specific requirements were as follows:
- Reduce footprint of IOM facilities in Orange County, CA, via consolidation of IOM operations.
- Reduce overall run rate and total facility operating costs in the 2010 fiscal year, and beyond by taking advantage of current market conditions.
- Provide future expansion capabilities for IOM operations.
- Minimize future capital requirements associated with the maturing in-place lease.
- Enhance Invensys “Green Standards” by securing a future LEED® Existing Building rating for the campus facilities.
- Minimize business disruption.
Colliers developed and implemented its ten-step programmatic tenant strategy aimed at achieving the corporate objectives noted above, within a prescribed time period.
Outcome & Results
As a result of the combined partnering efforts of Invensys and Colliers, the Invensys lease in Lake Forest was renegotiated and extended through March, 2019. The revised lease structure provided Invensys with the following benefits:
- Reduction of the original remaining real estate obligation by $2.8 million, or 26.2% of the total remaining rental and operating expense obligation.
- NNN rent was reduced to “market”, representing a 41% reduction in the remaining rental obligation.
- The extension provided the tenant with long-term security and certainty for their core HQ facility and included generous rights to expand into adjacent premises.
- Colliers implemented the process for LEED® certification with a projected completion date of 4th quarter of 2010.
- The negotiations resulted in NO business disruption. In fact, the stability of the operations continues to aid Invensys in employee attraction and retention.
Colliers continues to provide transactional consulting and advisory services on behalf of Invensys’ worldwide operations.
Bret Hardy