Alvarez & Marsal’s P3 Infrastructure Real Estate Advisory group served as the real estate and transaction advisor to the Travis County Commissioners Court, leading the County through this innovative, $333 million public-private real estate transaction for Travis County’s new 430,000 square-foot civil and family courts facility. This transaction allowed the County to acquire both the land and a turn-key facility delivered and financed by Travis County Courthouse Development Partners (TCCDP).
Travis County has been working on plans to replace the Heman Marion Sweatt Courthouse, which opened in 1931, for over a decade. In February 2018, the Travis County Commissioners Court voted to solicit proposals from private partners interested in both putting up land for the project and providing a courthouse facility that would meet the County’s performance specifications.
The project features 25 courtrooms and 390 parking spaces within a raised podium. Phase II of the project is expected to include a 14-story office tower and leased space for synergistic tenants who wish to locate nearby. Additional amenities include a short-term child drop-off center, a large multi-function room for public events, a law library, as well as a self-help center and community plaza.
As transaction advisor, A&M prepared the real estate solicitation documents, provided expert advice in evaluation of the three competitive bids and advised Travis County throughout the negotiations with TCCDP.
“This innovative real estate transaction allows the County to acquire critical social infrastructure that meets modern justice facility performance requirements, while transferring appropriate construction and financial risk to the private developer, TCCDP, ” said Jay Brown, A&M Managing Director and lead transaction advisor to Travis County. “A&M’s multi-faceted approach was critical to addressing the space needs for the civil and family justice system.”
A member of the Courts Facility Subcommittee, Commissioner Jeff Travillion, said “The working team’s advice and analysis were critical throughout the process. Together, we were able to evaluate several design and funding options which address critical county functions mandated by the Texas Constitution.”
A&M’s approach to the project included offering the prior courthouse downtown site at 308 Guadalupe for lease and reinvesting its value in the court’s facility project. “It took a significant amount of expertise and know-how to navigate the delicate transactions of leveraging the value of 308 Guadalupe and the acquisition of a new civil and family courts facility. A&M’s guidance was central to achieving both goals,” said Courts Commissioner and Facility Subcommittee member, Brigid Shea.
Through the Purchase and Sale Agreement and Ground Lease executed on March 25, 2019, the County has already purchased the site from TCCDP and will acquire the courts facility when construction is completed by the end of 2022. The development team took on construction and other project risks, offering a guaranteed maximum purchase price to the County for the project.
For more details on the transaction, see this case study, original published in Inframation News, an Acuris company.