Donald C. Kendig, CPA FCERA Realty Group LLC Agent 7778 N Palm Ave Fresno, CA 93721 BOARD AGENDA LETTER DATE: May 2, 2018 TO: Board of Retirement as Sole Member, FCERA Realty Group LLC FROM: Donald C. Kendig, CPA, Agent SUBJECT: Consideration of Property Management Proposal for FCERA Offices located at 7772 and 7778 and Authorization for the Retirement Administrator to Execute and Agreement with Dana Butcher Associates Once Reviewed and Approved by Board Counsel – APPROPRIATE ACTION Recommended Action 1. If the Board wishes to contract with a professional property management company outsourcing FCERA’s management of the offices, staff recommends approval of the attached property management proposal and the authorization of the Retirement Administrator to execute an agreement with Dana Butcher Associates once the agreement has been reviewed and approved by Board Counsel. Alternative Recommendation 1. If the Board does not wish to contract with a professional property management company outsourcing FCERA’s management of the offices, staff recommends working with Fresno County Facilities for the majority of FCERA’s facility needs leaving it to the discretion of staff to determine whether or not to contract directly with a particular facilities maintenance trade. Fiscal and Financial Impacts Approval of the recommended action would guarantee an additional cost of $900 a month ($10,800 per year) for facilities costs, of which a portion, if not all could be offset by the efficient selection of cost effective service providers and the prevention of any potential costly deferred maintenance items, preserving the value of the asset. The amount of potential savings is not guaranteed or easily estimated.
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Donald C. Kendig, CPA FCERA Realty Group LLC Agent 7778 N Palm Ave Fresno, CA 93721
BOARD AGENDA LETTER DATE: May 2, 2018 TO: Board of Retirement as Sole Member, FCERA Realty Group LLC FROM: Donald C. Kendig, CPA, Agent SUBJECT: Consideration of Property Management Proposal for FCERA Offices located at
7772 and 7778 and Authorization for the Retirement Administrator to Execute and Agreement with Dana Butcher Associates Once Reviewed and Approved by Board Counsel – APPROPRIATE ACTION
Recommended Action
1. If the Board wishes to contract with a professional property management company outsourcing FCERA’s management of the offices, staff recommends approval of the attached property management proposal and the authorization of the Retirement Administrator to execute an agreement with Dana Butcher Associates once the agreement has been reviewed and approved by Board Counsel.
Alternative Recommendation 1. If the Board does not wish to contract with a professional property management company
outsourcing FCERA’s management of the offices, staff recommends working with Fresno County Facilities for the majority of FCERA’s facility needs leaving it to the discretion of staff to determine whether or not to contract directly with a particular facilities maintenance trade.
Fiscal and Financial Impacts Approval of the recommended action would guarantee an additional cost of $900 a month ($10,800 per year) for facilities costs, of which a portion, if not all could be offset by the efficient selection of cost effective service providers and the prevention of any potential costly deferred maintenance items, preserving the value of the asset. The amount of potential savings is not guaranteed or easily estimated.
Consideration of Property Management Proposal for FCERA Offices located at 7772 and 7778 Page 2
Background & Discussion FCERA Realty Group LLC obtained a competitive proposal from Dana Butcher Associates to manage the 7766 N Palm Avenue Building through a public RFP process. During a discussion of the management services to be provided Dana Butcher, staff explored if it would be possible to separately manager the other two buildings, that are anticipated to be transferred back to FCERA, and how much that would cost. Staff received a cost of $900 per month and, during the quarterly LLC financial report during the April 4, 2018 Board meeting, communicated that there was an opportunity to have the properties managed professionally, even after transfer back to FCERA, if the Board chose to do so. The Board expressed interest in pursuing professional property management and directed staff to return with a proposal at the next meeting. The attached proposal is provided for the Board’s review. If the Board wishes to contract with a professional property management company outsourcing FCERA’s management of the offices, staff recommends approval of the attached property management proposal and the authorization of the Retirement Administrator to execute an agreement with Dana Butcher Associates once the agreement has been reviewed and approved by Board Counsel. The LLC would execute the agreement and would then assign the agreement to FCERA, if the properties located at 7772 and 7778 N Palm are transferred to FCERA. The contract would be drafted such that it could be transferred and ultimately canceled, if the Board felt that the services provided were not worth the additional cost. Attachment
1. Property Management Proposal by Dana Butcher Associates
PROPERTY OWNERS PROPERTY Blair Pence Multiple Office Buildings Pence Investment Corp. (310) 555-6414 ext. 105 Eldora Rossi Office Building (559) 275-2041 Clovis, CA Vic Roznovsky Craycroft Park Spano Trust 6535-6495 N. Palm (559) 435-5100 1060-1080 W. Sierra Fresno, CA John Travis Shaw Commerce Center East Group Properties 4055,4057,4065,4069 W. Shaw Ave. (602) 840-8600 4603 N. Brawley
Fresno, CA Patricia Macartney (Previous Client) The Virginia Hotel–Office Complex AmericanWest Bank Fresno, CA (541) 282-5156 Eric Wilkins (Previous Client) Multiple Medical/Office Buildings Wilkins Enterprises Fresno, CA (559) 439-9200 Tom Anderson Premiere Plaza A. T. Investments IV S/W Corner First & Nees (559) 437-1303 Fresno, CA Kevin Tweed Tulare Pavilion Shopping Center A.T. Investments IV 1531-1565 N. Hillman (559) 229-4444 Tulare, CA
Jerry Cook (Previous Client) 2773 N. Business Park Dr., Fresno Cook Land Company 5856 E. Brown, Fresno, CA (831) 687-0900 5823 E. Princeton, Fresno, CA Frank Gong First/Bullard Shopping Center Gong, Young Inc. Bullard Fair Shopping Center (559) 439-6760 Fresno, CA Casey Abe Trading Post Shopping Center Rich Development Enterprises, LLC Clovis, CA (310) 547-3326
DANA BUTCHER ASSOCIATES BROKER REFERENCES
BROKERS COMPANY & DIVISION Phil Sousa Newmark Grubb Pearson Commercial Senior Vice President Office Division (559) 447-6283 Direct Line 7480 North Palm Avenue, Suite 101 BRE License #00853867 Fresno CA 93711 [email protected] Jeremy Reed Newmark Grubb Pearson Commercial Senior Vice President Office Division (559) 447-6285 Direct Line 7480 North Palm Avenue, Suite 101 BRE License #01203327 Fresno CA 93711 [email protected] John Lee Retail California Vice President Retail Division (559) 447-6257 Direct Line 7480 North Palm Avenue, Suite 101 BRE License #01406883 Fresno, CA 93711 [email protected] Lewis Smith Retail California Senior Vice President Retail Division (559) 447-6235 Direct Line 7480 North Palm Avenue, Suite 101 BRE License #01214178 Fresno, CA 93711 [email protected] Steve Rontell Colliers International Senior Vice President | Principal Retail Properties Group (559) 221-1271 ext. 113 7485 North Palm Avenue, Suite 110 BRE License #00932510 Fresno, CA 93711 [email protected] Brett Vincintainer Newmark Grubb Pearson Commercial Vice President 7480 N. Palm Avenue, Suite 101 (559) 447-6265 Fresno, CA 93711 BRE License #01792092 [email protected]
Brandon Lamonica Fortune Associates Vice President Office Division (559) 490-2500 ext. 114 680 W. Shaw Avenue, Suite 200 BRE License #01317857 Fresno, CA 93704 [email protected]
Patric Davis Colliers International Vice President Retail Division (925) 227-6219 Direct Line 3825 Hopyard Road, Suite 195 BRE License #01193278 Pleasanton, CA 94588 [email protected] Scott Carruth CBRE Vice President Retail Division (916) 446-8717 Direct Line 555 Capitol Mall, Suite 100 BRE License #01372285 Sacramento, CA 95814 [email protected]
Certified Property Manager 1690 W. Shaw Avenue, Suite #220 Fresno, CA 93711 (559) 446-2001 BUSINESS HISTORY: 1986 - Established Dana Butcher Associates, a full service
Property Management Company specializing in Commercial Property Management; Retail, Office Buildings, Industrial and Commercial Associations.
Our management portfolio includes the following (located from The Inland Empire and High Desert to Sacramento and the Bay Area):
A) 66 shopping and strip centers totaling 2,581,171 square feet B) 55 office buildings totaling 1,346,267 square feet C) 5 industrial centers totaling 560,689 square feet D) 11 commercial owners associations
We employ 14 full-time office staff including, three licensed Property Supervisors, two licensed Assistant Property Supervisors and eight support personnel.
AFFILIATIONS: Licensed Real Estate Brokerage Firm Member – California Association of Realtors Member - National Association of Realtors
IREM – San Joaquin Chapter #85, Certified Property Manager Member – Fresno Area Chamber of Commerce Member – Fresno Better Business Bureau
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760
SAVINGS BALANCE FORWARD -$
CHECKING BALANCE FORWARD 280,513.42
CASH BALANCE FORWARD 280,513.42
RENT INCOME 38,992.50
CAM REIMBURSEMENT 13,392.13
DEPOSIT INCOME (1,800.00)
INTEREST INCOME 0.00
MISCELLANEOUS INCOME 0.00
TOTAL INCOME 50,584.63
OPERATING EXPENSES 37,900.66
DEBT SERVICE 0.00
TOTAL EXPENSES 37,900.66
NET CHANGE 12,683.97
FUNDS TO OWNER (20,000.00)
FUNDS FROM OWNER 0.00
NOTE PAYABLE (RECEIVABLE) 0.00
PREPAID RENTS (9.32)
DEPOSIT IN TRANSIT 0.00
FUNDS TO (FROM) SAVINGS 0.00
FUNDS TO (FROM) CHECKING (7,325.35)
CASH AVAILABLE IN SAVINGS -$
CASH AVAILABLE IN CHECKING 273,188.07
LESS PREPAID RENT BALANCE (3,267.96)
AVAILABLE CASH 269,920.11$
OCTOBER 2016
SHOPPING CENTER
SAMPLE FINANCIAL POSITION REPORT
760
<-------- CURRENT -------> <-------- YEAR TO DATE ------->
BUDGET ACTUAL VARIANCE BUDGET ACTUAL VARIANCE
INCOME
RENT INCOME 36,396.91$ 38,992.50$ 2,595.59$ 433,863.10$ 470,831.61$ 36,968.51$