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Case Study

Center for Strategic and International Studies (CSIS)

Center for Strategic and International Studies (CSIS)

"JLL was extremely thorough and provided us outstanding advice in the land acquisition, construction and financing of our new headquarters building. Their wise counsel saved us significant sums of money. We would recommend them to any non-profit facing complex real estate and financing decisions."  

Greg Broaddus
Chief Financial Officer, CSIS
 
Situation / Process

CSIS, a high-profile, foreign policy research organization, engaged Jones Lang LaSalle to create a strategy for new headquarters space to replace the 90,000 s.f. it leases in an older building with insufficient and outdated conference room space in Washington, D.C.

Our team reviewed lease vs. buy options and the timing of execution to determine which option would best meet CSIS’s goals. We negotiated the land purchase, once CSIS selected a land acquisition and build-to-suit structure.

Numerous financing structures such as taxable debt, tax-exempt debt and CRATS were examined to determine the type of financing with the lowest cost of capital and most financial flexibility to finance CSIS’s land acquisition.

Jones Lang LaSalle worked with multiple financial institutions to receive credit enhancement and underwriting term sheets to compete the financing and negotiate the best financial deal.

Results
Our team secured the land acquisition of one of the few remaining developable land parcels in Washington, D.C.’s CBD. The firm is currently managing construction of a 130,000 s.f. build-to-suit, state-of-the-art headquarters projected for completion by 2013.

We successfully negotiated a $33.6 million tax-exempt financing with a letter of credit fee of less than 20 bps and an all-in five-year cost of financing, including an interest rate swap, at 3.19 percent, for the land acquisition. The takeout financing totaled approximately $90 million, which included a taxable line of credit to be paid off with a gift campaign and a tax-exempt fixed rate bond issue, closed in June 2011.

The combined structure of the taxable line of credit and fixed rate bond issue produced dramatic savings over an all fixed rate bond issue.

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