Planning District Commission Building Committee   10/2/2025

Mr. Rutherford?

Yes, I'm currently at my house, 963 Pea Vine Lane, Shipman, Virginia 22971.

My name is Jesse Rutherford, and my mother-in-law recently passed, so it is imperative I be home for a little bit.

Our condolences, my friend.

We allow Jesse to participate by all the claims that I

So speaking of that, has everybody heard about Moselle's passing?

I don't think there's anything else.

Anybody else?

Great, so the purpose of this building committee is to discuss potential tenant improvements to the building of TJPDC Rents.

We're going to walk through a staff memo that was provided in the packet to give some background on the existing building and then go through a potential scope of work.

Hopefully at the end of this meeting we'll have some good discussion about the scope of work and then the hope is that the staff

that the building committee will recommend to the full commission the funding that will come along with your recommendation on the scope.

So that's where we're gonna begin.

So the staff member that you have included some background, the leased space that we have here at both 401 and 407 Water Street is about 7,183 square feet.

The base rent currently per square foot is $15.12 in the fall of 24.

We had a discussion with the commission about the future of tenancy and whether or not the commission was interested in considering a purchase or renewing a five-year lease.

Staff was directed to begin negotiation on a five-year lease, but the commission also supported staff's request to develop a scope of work for some tenant improvements to do some cosmetic things, but also some

O'Brien,

subcategory, I don't know what you call that.

They just wanted us to know that.

And so the cost estimate for the full scope of work is $221,693.

If Emerick tries to cross our five-year lease, it would have a 3% annual escalator.

So that means the total cost across those five years would be $235,300.

And then I put a table just shows you what our base rent is.

Our current lease and the owners have indicated that they're willing in our renegotiated lease to also do three percent increase on that base rent.

So that would be the base rent for each lease year, as well as the improvements energized for each lease year for the total lease amount.

So our intent is then put this detailed scope of work in front of you and walk through it, answer questions,

See if there's anything on here that you do not believe either this committee or the commission would support or if there's anything that should be on here that was not included in the original scope of work.

So starting at the beginning, they did estimate that once we made a decision, they would be able to do the construction within about six weeks.

We did indicate that we would have some flexibility to be able to relocate staff working remotely during that time in order to expedite the timeframe.

but that we may need to have some considerations for public meetings and rental space if we needed to have in-person public meetings.

A majority of our bodies do allow for all electronic.

So if we could schedule around that and have all public meetings, all electronic, that would keep it within that six weeks.

This scope includes all of the permit costs as well.

And then at the risk of going through this too detailed, since you guys are all in the industry, the flooring,

What we looked at was a luxury vinyl plank in all of the common areas.

That includes the Water Street Center and all the breezeways, walkways, the front two bathrooms.

We did not include the back two bathrooms because they have tile that's in decent shape, so there was no need to replace those.

And then commercial carpet tiles in all of the individual office spaces.

So that would be in individuals.

This room would be luxury vinyl plank.

I'm missing any other areas.

and then all of the accessories to finish the board.

So any transitions, all of the, you know, or around, around the edges, all of the different finishes to get that floor installed.

Let me just keep going all the way through.

Okay, next would be paint.

That is sanding walls, wood trim, and repairing minor defects.

That is priming and painting all walls and trim.

In many areas, that includes taking down of old

Eder, dated sound paneling or billboards like this.

Also in the main hallway, if you haven't noticed, one of our walls is like an old carpet.

So they would remove all of that sanded down drywall, bring it back up to drywall and then paint the entire place.

It then also would include on the exterior windows, new window treatments.

We do have some like metal blinds that no longer open and close.

So just pulling down all of the metal blinds and putting in the

the UV pull down fabric screens.

And then included in this is also allowances for in our kitchen, doing a renovation of the kitchen that has all of the counters, countertop appliances, new drywall.

If you haven't been in there, it has a little bit of a drop ceiling there.

We believe that's more of a soffit than anything, not functional.

So bringing the ceiling back up to height, replacing all of the details in the kitchen.

and then on the interior office spaces if you haven't ever noticed there's also this metal blind material between the glass offices and some of them work well some of them don't some of them have broken pieces so it's pulling out all the metal blinds and putting a frosted film at about a third just for privacy or confidentiality but also leaving the top and the bottom open so you can tell who's where.

That is the majority of the scope.

What this scope does not include is any contingency.

One of the things that we did talk about in our walkthrough with the landlord and the contractors was the need for sound control in the Water Street Center, because if we're going to go with a luxury final plank and we have all the

Virtual meetings where there's a lot of echo and difficulty hearing that we would need to address sound that is not included in this.

We would have to do that separate.

While they're happy to help us source materials and then do installation, they didn't include it in the original scope because we didn't really give them a ton of detail.

Would that be drop panels from the ceiling?

Would that be paneling on the wall?

So that takes a little bit more research.

So that was not included.

And then any scope that you all determine

And there's only the one kitchen in the back.

There's two.

Yeah, there's the staff break kitchen.

The one in the Water Street Center wouldn't be touched other than the flooring and the paint.

There was a lot of unfinished storage space in this building.

The renovations?

Yeah.

It's in here.

8,000.

Do you remember?

Our, yeah, 8,094.

They're rolling in now.

What?

I would assume, since we're asking them to do improvements to those pieces, but I don't.

Does that include our lease, since we currently don't lease that space technically, right?

And we did the cost of these improvements per square foot based on the 7,100.

Which is 31,000.

And you're doing it by the square foot.

But I was also thinking in terms of stuff that we're not touching.

So.

So money and construction is a place where I come, you know, where I have, that nexus I dwell one of the times and it's the only thing that makes me, well there are a couple of things that I'm sort of questioning, but one of them is that there's one line I am for $103,000 that just simply says finishes.

But I guess that, yeah, they're providing the breakout.

here, but it's not really a truly a disconnect detail.

So I think the disconnect here is if we were doing the work ourselves, we would have a much better deal.

Yeah.

But they're spending $200,000.

Yeah I mean it's their money so in that sense it's our money.

But that said, have they indicated how much flexibility they have in this to work with us?

Kitchen is 12, 13 liter if you custom plastic laminate kitchen cabinets.

Yes.

Right.

You know, did we get product, did we get an idea to see what... No, they wanted to hear whether we're considering moving forward, and then they said they would come to us with material options for selection.

So in that case, does it make sense for us to declare our intent, then get the level of detail, then formally bless it?

Just on the grounds that the chances that the price is going to change is, you know, somewhere between, I'd say, 98 and 101 percent with the allowances and such.

So just in terms of having numbers that are numbers.

Because I agree with Keith on the kitchen.

My concern is that you have an expectation of A and this is minus A, right?

And to Phil's point, I think the question becomes, what are we getting for this amount of money, right?

And it might make more sense to follow it.

Yeah, a couple of comments on that.

Our purchasing procurement requires anything over 10,000 to go through, anything 10,001 to 100,000 requires that we see four bids.

I think that's what you're saying.

You're not saying us, we do the work?

I'm saying we do the work.

What I'm saying is if we,

In terms of the lease and paying for the improvements, it might make sense to front load it earlier.

So in other words, wrap it up in three years instead of five.

Yeah, if it's included in the lease, it doesn't matter if we pay it at the beginning or

Throughout the term of the lease, it will be covered under the procurement.

I'm not concerned about the procurement issue.

What I'm talking about is the actual cost benefit to negotiating the lease such that we amortize it faster.

And I'm not sure there is.

It's a $14,000, $15,000 leverage over five years.

It's $3,000 a year.

I'm curious for budgeting purposes if it would be easier for that to be consistent across five years.

It will not have a difference on our, we talked to the auditor with this, whether we pay it a little upfront and then pay it off in three or pay it across five, either way it'll have the same impact on our indirect cost rate because it will either be a leasehold improvement that is an asset that depreciates

Was there any conversation about, you know, hey we opened up a wall or we pull up a carpet and find out there's no work to be repaired.

Yes, that we don't know what we don't know.

Yes, we have talked about that.

And there was no contingency included in the proposal that they gave to the owner.

We don't necessarily get, you know, we can negotiate whether we want to add a contingency into this.

The other option, though, is we can

The other thing is is that depending on what they find it might be not something we're paying for anyway.

It's their problem.

Or what have you.

We don't see it.

It's not really part of our space.

We're not responsible for redoing the electrical work of a wall that they pull in.

O'Brien, and the rest of the panelists.

and Jesse, chime in because you know this world better than anybody.

But it is true that in the history of contracting, allowances have come in precisely after budget in my nearly 30 years in the finance world and maybe 500 projects.

Yes.

They show us.

They show us an iPhone one.

We're thinking we're getting a 17.

Yes, we can.

I mean.

In the history of allowances on any job site I've ever done, it's always been the wrong number.

I've always been incorrect.

It's just part of that story.

In my mind, I think we could ask ourselves seriously to what scope.

Can we control some of the upgrades that we're doing?

You know, obviously the landlord's going to do things that improve his situation, of course.

And if he can justify it with amortizing the rent in that over the next five years, good for him.

I don't think there's anything wrong.

Way below.

So honestly that I think the only thing up for discussion in my mind is asking ourselves, do we want to just get rid of allowances and then TJPDC just huff some of that, you know, figure that out.

Um, but you know, that's right.

So yeah.

Yeah.

Yeah, that's what I'm saying.

But I think if we leave the allowances in there, I'm almost metaphysically certain we're going to go over.

So that's just most easily handled with a check.

Well, I mean, maybe.

Contractor's making a markup on those allowances anyway.

He might have already priced that in.

They're fronting the cash.

They're doing it.

I think I have a solution for it.

So I just think, I just think we approve this the way it is.

And we roll in a, we roll in the motion and we roll in the thing that there's a 20% put aside.

Yeah.

And then you control that if you get to use that or not.

Yeah, that was the next question that I written down.

O'Brien,

No?

And then the recommended motion we have here won't have that contingency in it, but if it's tonight's budget, the FY 27 budget that you guys will be taking action on is the projected budget.

It comes back around to you in the spring, and I can include that contingency earmarked in the spring.

I may be going into weeds on this one at the moment.

We did talk about the time period that this was going to occur.

So sometime between November and the end of the year.

We also talked about maybe, you know,

If they could do...

Segregated.

Phasing it, yeah.

Well, I can tell you that the money from the district work is just going to be nuts in here.

Even if they phase it in.

But in those situations, we have the flexibility to rent space somewhere for those to be in person.

I would hesitate to have the final regional transit partnership be virtual if it's the last meeting of the body.

Can you get that figure to be closed?

Yes.

Well, it might be fun for them to go do something somewhere different.

The only other one is the commission.

But I'm requesting that the November meeting be virtual because I'll be out of town.

If we decide to do December instead because of this construction, it may be that that crucial meeting is held without me on my team.

So what do you need us to do?

Until late January, right?

So you've got some flux filled in to the start of the year.

Commission doesn't need the February.

Yeah, I mean I think it just gets, it will be, you know, it will get managed and parts of it will be unpleasant.

I do think that in terms of these contingencies we ought to be careful because in the history of when, you know,

This is the right committee to say that because it would be you all on that committee.

And it's already in there.

All right, so I move that we recommend the commission to accept the scope of work as the basis for the renovations and the cost therein, and that we include a 20% contingency for overruns and changes.

Kerry?

I think you need to add to that.

Second.

Sorry.

Okay, yeah.

I'll manage to include that.

Okay.

Everybody got that?

Who's taking notes?

Yes.

Second.

We got the motion now, right?

You got 30 seconds.

All right, all in favor?

Aye.

All right.