NCDOT Facilities Management & Division of Motor Vehicles Summary of Requests for Proposals for Leasing Options for new DMV Headquarters Site
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1 NCDOT Facilities Management & Division of Motor Vehicles Summary of Requests for Proposals for Leasing Options for new DMV Headquarters Site Report Compiled by: NCDOT Facilities Management Unit Director: Sterling Baker, P.E. November 13, 2018
2 Executive Summary 1.1 Session Law As a required by Session Law Senate Bill 99, DMV shall vacate the New Bern Avenue Property and move into a leased facility. The legislative requirements read as follows: VACATE DMV NEW BERN AVENUE PROPERTY/ISSUE RFP FOR LEASING SPACE OUTSIDE RALEIGH SECTION (a) All Division of Motor Vehicles employees and contractors working at the Division of Motor Vehicles building located on New Bern Avenue in the City of Raleigh shall vacate the property by October 1, SECTION (b) By no later than August 1, 2018, the Department of Administration shall issue a Request for Proposal (RFP) seeking leased office space or spaces for the Division of Motor Vehicles employees and contractors currently working at the Division building located on New Bern Avenue in the City of Raleigh. The geographic scope of the RFP shall include Wake County and surrounding counties. SECTION (c) G.S reads as rewritten: " Offices of Division. The Commissioner shall maintain an office in Raleigh, North Carolina, Wake County, North Carolina, or a surrounding county, and in such places in the State as the Commissioner deems necessary to properly carry out the provisions of this Article." 1.2 Project History As required, NCDOT Facilities Management Unit (FMU) and the Division of Motor Vehicles (DMV) has been aggressively pursuing the proposed lease with the State Property Office (SPO) and CBRE, their client representative. After going through the SPO process of advertisement, site visits, and reviews, a Proposer s Conference was held on October 24 th, At this conference the proposers were allowed to ask final questions and then submit their Best and Final Offers. We received 12 proposals from eight (8) different lessors/owners Two proposers submitted more than one proposal. As required by SPO, the final square foot prices must include demolition and upfit, building and grounds maintenance, taxes, insurance, and other building operational costs as a part of their final cost. Proposers have the option to include utilities and janitorial services. There was a mixture of vendors/owners offering some, none, and a combination of these costs. Therefore, a spreadsheet was created to adjust the costs and properly compare the alternatives provided. These adjustments were based on square footage adjustments provided by the SPO (utilities - $1.5/sq. ft.; janitorial services -$1.00/sq. ft.; and water/sewer - $0.17/sq. ft.). These adjusted comparisons for all proposals can be seen in Appendix A. For the proposed 15-year lease, adjusted proposals range from $36,328, to $66,973, Page 2 of 9
3 1.3 Shortlisted Sites Based on the adjusted proposal costs, the review committee narrowed the options to two potential sites. Site A is located at N. Church Street in Rocky Mount (Exhibit 1). Site B is located at 2400 Ellis Road in Durham (Exhibit 2). Exhibit 1 Exhibit 2 Page 3 of 9
4 1.4.1 DMV Considerations Just under 600 employees are based out of the current DMV HQ site on New Bern Avenue in Raleigh. Exbibit 3 (below) contains a map illustrating the location of these employees across the Wake County and the surrounding counties. Exbibit 4 (below) shows a comparison of where the current employees whose duty station is currently the New Bern Avenue campus reside. Site A Site B Existing HQ Exhibit 3 Page 4 of 9
5 Percentage of DMV HQ Employees living in counties surrounding wake county Nash 1% All Other Counties 13% Johnston 15% Harnett 4% Granville 1% Wake 58% Franklin 5% Durham 2% Chatham 1% Wake Chatham Durham Franklin Granville Harnett Johnston Nash All Other Counties Exhibit 4 Based on the addresses of all of the employees, a centroid address was determined based on the average of the longitudinal and latitudinal coordinates for each address. The address of this centroid is 101 Timber Pointe Lane, Garner, NC. Based on this centroid address and the addresses of the two potential sites travel times and mileage (as obtained from Google Maps at 8:00am on a weekday) are as follows: Site Site Address Centroid Address Mileage Route Estimated Time A N. Church 101 Timber Pointe 59.8 mi US min St., Rocky Mount Lane, Garner B 2400 Ellis Road, Durham 101 Timber Pointe Lane, Garner 27.4 mi Via I min Based on the location of both of these sites, DMV acknowledges the potential for some loss of employees to retirement, transfers, etc. DMV s existing vacancy rate has hovered around 10%. The average turnover rate (including transfers) is 10.10% from November 2017 to October The average length of service for employees at DMV HQ is 164 months (13.66 years). Page 5 of 9
6 1.4.1 Wake County License Plate Agency (LPA) The DMV HQ site on New Bern Avenue also has the Wake County LPA office located inside. As this site must stay in Wake County (preferably near the current location) it could not move to either Site A nor Site B. As such, this would require that approximately DMV employees (this is a DMV staffed site) would have to remain on this site or move to another location in Wake County. As per G.S the only LPA offices that are allowed to be operated by DMV personnel are in Wake, Cumberland, and Mecklenburg Counties, all other LPA offices shall be operated through commissioned contracts insofar as practical and possible. Conversations between FMU and DMV have led us to recommend that it would be best to keep the LPA office on site and move them into the Annex Building. The first floor of this building could be up fitted to be a customer facing setup to facilitate this change in use. This could be considered contrary to the legislation and will have to be discussed further. There is the possibility that Toll Authority may relocate their call center to the Annex Building depending on future plans. Page 6 of 9
7 1.5 Cost Comparisons As noted previously the chart in Appendix A shows the adjusted yearly costs for all proposers and for all locations. The following Chart summarizes all of this in an abbreviated form: Site Site Address A N. Church St., Rocky Mount B 2400 Ellis Road, Durham C 2337 US 70 HWY East, Garner #B- Option 2 D 2337 US 70 HWY East, Garner #B- Option 1 E 2337 US 70 HWY East, Garner #A- Option 2 F 2337 US 70 HWY East, Garner #A- Option 1 G Sumner Blvd, Raleigh H Greenfield & Waterfield Parkway, Garner I 4800 Falls of the Neuse Rd and 3127 Smoketree Court (Dogwood), Raleigh J 4401/4405/4407 Bland Road, Raleigh K 1101 Shiloh Glenn Dr., Morrisville L 3100 Smoketree Court & 3127 Smoketree Court Avg. Annual Cost (Adjusted) Total Cost over 15 Year Term (Adjusted) Annual Delta Above Low Bidder $2,421, $36,328, $0.00 $0.00 Total Delta Cost Above Low Bidder (for 15 yr Term) $2,629, $39,435, $207, $3,160, $3,367, $50,507, $945, $14,178, $3,385, $50,788, $963, $14,459, $3,453, $51,802, $1,031, $15,474, $3,472, $52,084, $1,050, $15,755, $3,829, $57,442, $1,407, $21,113, $4,113, $61,708, $1,691, $25,379, $4,253, $63,798, $1,831, $27,470, $4,332, $64,987, $1,910, $28,658, $4,461, $66,919, $2,039, $30,590, $4,464, $66,973, $2,042, $30,644, Page 7 of 9
8 As shown above the difference between Site A and Site B is $ $207, on an annual basis and $3,160, over the entire 15 year term of the lease. After that, all other alternatives are at least $945, to as much as $2,042, more expensive on an annual basis. In regards to the total 15 year term for the lease, the other alternatives are at least $14,178, to as much as $30,644, more expensive. 1.5 Site A and Site B Comparisons Number of Buildings/Floors Site A 1405 N. Church St. Rocky Mount, NC 5 Buildings Total 1 Building w/ 6 floors 4 Buildings w/ 1 floor each Site B 2400 Ellis Rd. Durham, NC 1 Building w/ 3 floors Proposed Square Footage for 139,181 NSF 132,582 NSF DMV Usage Type Double Net Double Net Distance from Centroid 59.8 miles 27.4 miles Estimate Peak Travel Time 57 mins 52 min from Centroid (8AM M-F) Estimated Off-Peak Travel 55 mins 30 min Time from Centroid Current Status Vacant Partially Occupied tenant vacating in next few months Most Recent Update/Renovation Parking Is proposing parking lot addition to meet RFP specs Is proposing parking lot addition to meet RFP specs Site Access / Visibility Excellent Very Good Notable Comments during Proposers Conference Owner stated they wanted to work with DMV in order to minimize upfit costs as much as possible None Page 8 of 9
9 APPENDIX A Page 9 of 9
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