Kormendi \ Gardner Partners is part of a multi-disciplined team, the Pruitt Group EUL, retained by the U.S. Department of Veterans Affairs (VA) to serve as advisors on a variety of Enhanced-Use Lease (EUL) projects. The EUL approach provides an avenue to capture market opportunities without using additional governmental budget constraints or appropriated dollars thus allowing under-utilized and obsolete facilities to be returned to a productive use to the benefit of the Department. KGP assists the VA by identifying and linking under-utilized assets with potential EUL opportunities.
Increasing operating and capital costs at the St Albans Veterans Affairs facilities in Queens, New York lead the VA to consider an Enhanced-Use Leasing project to minimize budgetary impacts caused by these increasing costs by leveraging assets to generate revenue, reduce costs and obtain private investment. Key activities performed by our team include:
• Identification of stakeholder needs (primarily through direct discussions)
• Identification of multiple Business Plan Options
• Estimations and projections of potential consideration provided to the VA
(e.g., cash, equipment, facilities and/or in-kind services) for the EUL
• Feasibility and Market analyses, including gathering community ideas and
• Marketing and Solicitation of the project
• Proposal review and Developer recommendation
Kormendi \ Gardner Partners developed cash flow models to prepare quantitative estimates of the valuation range of the land and buildings to be leased for each Business Plan Option (“BPO”) identified. These estimates were based on rental, operating cost, capitalization rates and land value data derived from national, regional and local sources. The analysis considered issues involving the use and availability of public incentives such as tax financing, tax abatement, sales tax sharing agreements, public funding of roads/utilities, transportation development and other special taxing districts, state and federal tax credits, grants, job training funds and joint development agreements to facilitate the project and its intended beneficiaries. In addition, KGP was required to develop substantive qualitative narrative analyses corresponding to each BPO.