This Fortune 500 chemical manufacturer selected UGL Equis to assist in managing its 8 million-square foot North American real estate portfolio.

The company’s goals for the partnership were to:

• Increase real estate savings and cost avoidance;
• Populate and organize a comprehensive database;
• Establish consistent real estate processes;
• Enhance support to its business units;
• Initiate strategic planning;
• Obtain greater flexibility through scalable resources of a service provider;
• Establish real estate metrics; and
• Obtain access to personnel with advanced skill sets in different areas.

Since contract inception, UGL Equis has rationalized the client’s portfolio, balanced the firm’s needs against its current assets, and considered financing alternatives that will best suit the company’s growth.

UGL Equis is currently reviewing the company’s third party logistics contractor strategy for its regional distribution centers. To date over 2 million square feet of contractor controlled space has been identified as opportunities to increase leverage with contract operators, reduce annual cost and increase space flexibility.

UGL Equis is also creating ongoing strategies to pursue that can minimize the client’s operating expenses while maximizing the amount of capital that can be released to pursue new business development. These strategies include opportunities to sell and partially leaseback space, create external tenancy, apply alternative financing methods and implement physical renovations.

In addition, through UGL Equis’ Project Services team, UGL Equis has developed a process for construction management, moves, adds and changes as well as capital budgeting and due diligence for all of the client’s asset types.

Since the client and UGL Equis began their partnership, the team has accomplished the following items:

• Populated and organized lease database that combined real estate and facilities databases;
• Executed critical activities resulting in annual revenue and savings exceeding $271,000 in FY 02, $4.5 million in FY03 and identified over $13 million in short and long term savings in FY 04;
• Implemented a national Project Services support team that has managed $5.9 million in capital expenditures in FY 04 alone;
• Established real estate standards and processes to better support the business unit managers;
• Provided real estate cost avoidance in excess of $4.3 million within the first year of the relationship; and
• Established files for 61 leased properties and additional 37 owned properties.

Currently, the team is facilitating the disposition of excess owned properties. In FY 04 alone, UGL Equis closed the sale of $4.9 million in excess owned properties.