Qwest Communications was an exclusive account of members of our team, and upon the merger of Qwest and US West, a large opportunity to create operating efficiencies was pursued. The Denver metro Portfolio was over 6mm sf with 16,390 employees in 37 facilities. The current book value as $310mm, with annual occupancy costs of $75.64m. Of this portfolio 2.5m was owned and 3.01m was leased, all in the downtown metro area. US West had a growth rate at the time of 3% and Qwest’s was 25% .
The strategy put in place and executed upon defined first the strategic assets and then a schedule of targeted space dispositions pursued.
Our strategy outlined how to manage the sublease and disposition schedule as Qwest’s downtown occupancy level, if vacated, would materially affect the market conditions, pushing rents down and hurting themselves.
The project was completed over a 2 year period with great success.
The reductions in Denver metro from 6.1m sf to 4.5m reduced the portfolio 1.6m sf. This savings was approximated at $34.3m per year.