1. Recent Developments in Federal Facility Privatization NCPPP P3 Connect July 2014 Marc Waddill Senior Vice President, Public Institutions JLL

2. 2 Introduction Federal Government owns or leases approximately 360,000 buildings and 3.3 billion square feet of space Major Real Estate Holding Agencies: −Department of Defense (Army, Air Force, Navy) −General Services Administration (GSA) −Department of Veterans Affairs (VA) −Department of Energy (DOE) Privatization Tools: −Fee Simple Disposal −Long-term Ground Lease (EUL, Section 111) −Exchange

3. Fee Simple Disposal 3 GSA Success Stories Georgetown West Heating Plant Approximately 2 acres Approximately 110’ tall Bethesda Federal Building 10-story building Approximately 130K SF

4. 4 Fee Simple Disposal Pipeline: −Primarily residential single family houses −Non residential includes mainly USPS sites, small tracts of land, SSA buildings, and small border patrol buildings −Unique Opportunities: Alan Bible Federal Building (Las Vegas) Plum Island (NY) Issues to Consider: −Private Sector Market −As-is / Where-is −Entitlements −Other Environmental Constraints

5. 5 Enhanced Use Lease (EUL) Agencies with EUL Authority: −Department of Defense (Army, Air Force, Navy) −Department of Veterans Affairs (VA) −National Aeronautics and Space Administration (NASA) Issues to Consider & Recent Trends: −Asset versus Market −Acquisition versus Disposition −Development of Single Asset versus Multi-Phase Development −Cash Consideration versus In-Kind Consideration

6. EUL: VA Affordable Housing 6 EUL Project NameDate ClosedTotal Number of Units 1Canandaigua, NY9/17/201233 2Dayton, OH11/7/201355 3Hines, IL12/13/2013122 4Lyons, NJ8/9/201261 5Minneapolis, MN5/12/201458 6Newington, CT9/7/201274 7Roseburg, OR10/5/201255 8Tuscaloosa, AL8/13/201350 Asset: Individual Building or Parcel for Specific Purpose Financing: Primarily Low Income Housing Tax Credits (LIHTC) Veteran Preference as Primary Consideration

7. EUL: VA Fort Howard Existing 7 Site Summary: Approximately 100 acres and 44 historic improvements (305k GSF) on the entire campus

8. EUL: VA Fort Howard Future State (Conceptual) 8

9. EUL: Army EUL Projects 9 ProjectProject Description Aberdeen Proving Ground - Maryland Boulevard 2M square foot class A office development on 250 acres; includes supporting retail Fort Detrick Central Utilities Plant, MD Central Utility Plant providing steam, chilled water and conditioned electric supply to National Medical Biological Defense Interagency Campus Fort Leonard Wood, MO 32-acre business and technology park Picatinny Arsenal, NJ Potential development of 1M square feet on 120 acres; R&D, office and flex space Redstone Arsenal, AL Mixed use development of 3-4M square feet on 400+ acre site. R&D, labs, hotel, academic space and retail Yuma Proving Ground, AZ Automotive Test Facility on 2500+/- acres; Army has use of the GM facility, and GM has constructed an automotive test track for Army's use

10. EUL: Air Force EUL Projects 10 ProjectProject Description Joint Base San Antonio (Fort Sam Houston) Developer leased 3 abandoned buildings and 10 acres of vacant land on Fort Sam Houston. Developer will develop additional office building on vacant land. Eglin AFB Water Reclamation 256 acres for maintaining an existing sewage effluent disposal field and construction of a 10M gallon per day wastewater treatment plant and a rapid infiltration basin effluent disposal system. Leased parcels are located outside gate. Eglin AFB Airport 108 acres to operate an existing airport terminal and construction, operation, and maintaining a fuel farm along with facilities for rental car agencies on an additional 23 acres. Leased parcels located outside gate. Nellis AFB Wastewater Treatment Facility City of North Las Vegas developed wastewater treatment facility on 41 acres. Hill AFB Office Park Mixed ‐ use commercial development on approximately 550 acres. The purpose of the project is to develop an aerospace research and technology park to benefit both the community and the AF. Potential to build up to 26 commercial buildings, 2 hotels, and 4 retail. Eglin AFB Hotel 17-acre parcel with 600 linear feet of beachfront. 152-room hotel to be constructed with development of retail pad. Provisions for second hotel if financial metrics met. Parcel located outside gate.

11. EUL: Navy EUL Projects 11 ProjectProject Description Moanalua Shopping Center, HI  Lessee constructed a 55,000-square-foot support services center for the Navy as in-kind consideration. The Navy pays no rent on the building, which was built for about $17 million  Lessee developed 30,000 square feet of commercial space for private-sector tenants Port Hueneme, CA – GAPS Industrial (Global Auto Processing Services)  Use limited to storage & processing of motor vehicles NB Point Loma, CA - ULA Industrial Lease (United Launch Alliance)  Leased for Production, Research and Development of Atlas Launch Vehicles and related components NB San Diego, CA – NASSCO Industrial Lease  Industrial space to aid in ship construction NAS Key West, FL – Mole Pier Commercial Lease  Outer Mole Pier is currently outleased to the City of Key West and utilized for cruise ship berthing

12. EUL: NASA Ames Research Center (ARC) 12 ARC has over 50 EUL agreements Tenants include Planetary Ventures (a subsidiary of Google, Inc.) and the University of California Received the 2003 GSA Achievement Award for Real Property Innovation

13. Exchange for Services 13 Equity Investment ($608M) Private Sector Ownership Conveyance of Forrestal to Private Sector Services Period: Construction, Renovation, and Other Services Value of Asset is Realized by Private Sector Capital Investment Private Sector Ownership Conveyance to Private Sector Issues to Consider: −Timeline −Services (level of detail, timing, change orders…) −Ownership Risks (As-is / Where-is, Entitlement Risk, etc.