Wells Fargo Bank, Dallas, Texas
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Analysis
Wells Fargo Bank (Wells Fargo) has been a tenant at Fountain Place in the Dallas Central Business District since March 1994 and its Lease is not set to expire until March 2005. However, The Amend Group was retained to determine and evaluate the rights, advantages and opportunities Wells Fargo could garner by taking immediate advantage of very weak market conditions.
Fountain Place is a landmark building in Dallas and was 99.7% leased when The Amend Group approached ownership. Given the major decline in leasing activity and the overall city vacancy rate approaching 40%, the owners of Fountain Place did not want to lose Wells Fargo’s tenancy. After securing very attractive proposals from both CBD Landlords and Suburban Landlords, it was clear that Wells Fargo had an opportunity to leverage an excellent restructured lease. The bank would secure an early renewal Lease restructuring to realize significant and immediate cost savings and lock in very attractive long term rental rates while also improving lease terms and conditions.
Methodical strategic negotiations over an extended period of time allowed maximum market leverage. After three proposal revisions, Wells Fargo secured an early renewal lease restructuring with a total of $2,067,076 in savings during the first fifteen months of the new lease.
Project Goals
- Tenant brokerage
- Space programming
- Negotiations
- Market analysis
Results Summary
- Locked in exceptional economic and space management terms for a total of 15 years
- Early commencement and rental abatement gave Wells Fargo an immediate savings of over $2 million
- Flat rental rate throughout the entire term
- Net Present Value is $3.75 per square foot less than rent before lease restructuring
- New Base Year for Operating Expenses and Taxes of 2003
- Over $1 million in tenant improvement allowance for space improvements
- Flexible renewal options at the end of the primary term of the lease
- Approximately 90,000 square feet of expansion space
- Increased size of building signage by 3 times