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September 28, 2016

With A&M’s assistance, Travis County, Texas was able to prepare for a complex public-private partnership at a downtown Austin site and quickly shift gears following a political mandate to create significant value for the County and its taxpayers.

Client Mandate
A&M was engaged by AECOM on behalf of Travis County, Texas to perform a highest and best use market analysis for a mixed use development, as part of the potential Travis County Civil and Family Court house (“CFCH”).  The existing courthouse facilities were operating with significant space and configuration deficiencies. After purchasing a full city block, Travis County hoped to leverage the value of private development on the southern half of the site to offset the cost of constructing a new courthouse.       

A&M Approach
A&M assisted Travis County in determining the strategic and financial feasibility and appropriate holding and capitalization structure for a public-private development. Our tasks included performing a local market study to determine hard, soft, and financing costs associated with project development, contingency costs, density requirements, and general development regulations, specific to the Travis County real estate market.  Additionally, A&M performed sensitivity analyses to determine the development scope that would maximize earning potential for Travis County and the state of Texas. Upon completion of the highest and best use analysis, A&M was tasked with evaluating the ground lease value of the South Tower site under an office, retail, and parking development scenario.

Additionally, A&M analyzed both traditional and Public-Private Partnerships (P3) capitalization structures and the associated project delivery methods to determine which structure would generate the highest value to the local government.

Due to requests from the electorate that the courthouse site be relocated, A&M was re-engaged by AECOM and Travis County to perform a secondary highest and best use analysis and valuation of the full city block site based on expanded use allowances provided  by Travis County. Having determined the value of the full site, A&M is currently assisting the County with selection of a private development partner who can offer maximum value for the site. This work includes drafting solicitation documents, evaluating proposals, conducting lead bidder interviews and leading negotiation.

Results
A&M’s efforts positioned Travis County to select the most advantageous financing, delivery, and transaction method. As we assist with partner selection and negotiation, County leaders will be armed with up to the minute market intelligence and best practices to protect the interests of the County and its taxpayers.