Chicago Community Loan Fund
CCLF secures its office leasing future and gains $6,781 of unrestricted free funding
Challenge
Chicago Community Loan Fund desired to expand its space and reconfigure parts of its current layout, but had 4 years remaining on its lease at 29 E. Madison. It occupied 3/5 of a larger suite also occupied by a second organization with which it had originally negotiated to co-occupy the larger space under two separate leases.
The second organization, which desired to reduce its space, was unable to fund any expense to accomplish that. A third organization occupied the balance of the floor and also desired to reduce its space, but had 3.5 years years remaining on its lease. If the third organization could negotiate an early termination of its lease, that would enable the second organization to simply move into that adjoining space, thereby enabling CCLF to expand into the space that its suite-mate had occupied. That would solve the problem for all of these organizations.
Action
MAP Real Estate was asked by all three of these nonprofits to represent them in independent negotiations whose objective was to facilitate the agenda of each organization.
This involved negotiating simultaneously on behalf of each organization with the incumbent landlord of all three, as well as with landlords of other buildings to which the third organization might relocate. CCLF desired much more space than either of the other two, as well as a much longer lease. For that reason, the success of the CCLF transaction would make it possible for the other two transactions to be structured.
The “three-way deal” depended on the first lease being successfully negotiated before the other two would be possible to negotiate. This degree of complexity is unusual for a typical office lease transaction. And, although successfully negotiating the transaction for CCLF would enable the other two transactions to be attempted, it was necessary to negotiate all three simultaneously, in order to arrange the puzzle pieces to achieve CCLF’s agenda, then the agenda of the other two.
Each of the three clients was aware that their lease’s fate depended upon all three leases being consummated.
Action
MAP Real Estate was asked by all three of these nonprofits to represent them in independent negotiations whose objective was to facilitate the agenda of each organization.
This involved negotiating simultaneously on behalf of each organization with the incumbent landlord of all three, as well as with landlords of other buildings to which the third organization might relocate. CCLF desired much more space than either of the other two, as well as a much longer lease. For that reason, the success of the CCLF transaction would make it possible for the other two transactions to be structured.
The “three-way deal” depended on the first lease being successfully negotiated before the other two would be possible to negotiate. This degree of complexity is unusual for a typical office lease transaction. And, although successfully negotiating the transaction for CCLF would enable the other two transactions to be attempted, it was necessary to negotiate all three simultaneously, in order to arrange the puzzle pieces to achieve CCLF’s agenda, then the agenda of the other two.
Each of the three clients was aware that their lease’s fate depended upon all three leases being consummated.
Result
CCLF entered into a long-term lease extension for 8,556sf, commencing 4 years later, because of the favorable economics of its current lease. But the 4,006 sf expansion and turnkey construction of the premises proceeded as soon as its former suite-mate was able to relocate down the hall, after that space had been vacated by the third organization.
An additional condition of the lease was a renovation of the public washrooms on the floor at the landlord’s expense.
Testimonial
Our organization needed to expand and reconfigure its layout. Complicating matters, our lease had 4 years remaining, and we shared space with a separate organization. A solution for us had to include a solution for them, and our agendas were quite different. Michael was incredibly professional and attentive, and crafted a transaction that achieved our ideal scenario. On top of a superb brokerage result, we received $6,781 of unrestricted funding from IIC. I strongly recommend MAP Real Estate for any organization that uses office space!
Robert G. Tucker, COO and EVP of Programs, Chicago Community Loan Fund
Investing In Communities funding to Chicago Community Loan Fund: $6,781