Energy Savings Performance Contracting

A smart partnership

:+ : By D’Wayne Kendrick

SMARTCAP, based in Redmond, WA, is a private real estate organization focused on delivering high value for its investors by leveraging its unique approach to analyzing investment opportunities. Utilizing detailed market research and proprietary tools, SMARTCAP builds sophisticated and accurate financial models for each of its assets. This data-driven approach enables SMARTCAP to find and build value faster than its competitors.

MacDonald-Miller is thankful to be a part of SMARTCAP’s process from acquisition through capital improvement and performance. The newest building being added to MacDonald-Miller’s Performance Contracting (Private Sector) portfolio is the K405 building, purchased by SMARTCAP in 2019. During SMARTCAP’s acquisition process, we worked closely with SMARTCAP to deliver our observations and recommendations report to identify and define this asset’s specific upgrade needs and develop a financial strategy for the improvements.

Utilizing MacDonald-Miller’s Performance Contracting designed specifically for the private sector, SMARTCAP will be able to complete significant energy saving capital improvements while reducing its required capital contribution by roughly 82%. This can be achieved without increasing the tenants’ expenses – a factor typically experienced with a capital amortization financing strategy.

K405 is Packed Full of Added Value:

  • Tenants will benefit from a modernized HVAC system including retrofitting existing zone boxes, complete controls upgrade, air balancing, and the ability to adjust the system using real time occupancy demands.
  • Upgraded lights and lighting controls will provide both improved workspace experience and the technology needed to control spaces based on actual occupancy demands.
  • Retrofitting the building’s elevator to improve safety, functionality, and appearance.
  • A 10-year energy savings guarantee is being provided and supported by MacDonald-Miller’s Smart Building Services to ensure the required financial accountability and system performance is realized for the full 10-year performance period.
  • MacMiller is guaranteeing this building will be compliant with the Clean Buildings Standard Energy Use Intensity (EUI) requirements and reporting for the next 10 years.
  • This project will use the soon-to-be available CPACER program in King County, which will provide more favorable financing terms. This program also has flexibility that will be beneficial when the building is sold.

SMARTCAP and MacDonald-Miller continue to deliver win-win results for both tenants and investors!

Design started in July with an estimated completion of Q1 2022.

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Categories: General

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