Alternative Third Party Financing Plans

1
SC Facilities Management Workshop

• Alternative (Third Party) Financing Plans
• E.T. Murphy, P.E.
• Brookhaven National Laboratory
• October 24, 2002

2
Alternative Financing - Background

• BNL has pursued private sector financed
  construction for many years
• Guest House/dormitory project, 1987
• Cogeneration, 1989
• Office building development study, 1995
• Steam Plant conversion, 1999
• Apartment area reconstruction project, 2001
• DOE/SC encouraging use of alternative financing
• Institutional Plan onsite review
• FY 02 and 03 contract performance measures

3
Alternative Financing - Plans

• Three major projects planned in near future
• Apartment Area Reconstruction
• Energy Sciences Building
• Chilled Water Plant Expansion

4
Alternative Financing Current Status

• Apartment Area Reconstruction
• 70 apartment units varying from 1-4 bedrooms
• 2 apartment units with 3 bedrooms with upgraded
  furnishings and appliances at the Directors
  discretion
• TEC 8 10M
• Sited on out-leased DOE land within apartment
  area
• Summer 2004 occupancy
• RFP and facility lease in review
• Internal
• Input from Battelle/ORNL
• RFP approval authority likely at DOE/BAO level
• Targeting RFP issuance 11/02

5
Alternative Financing Current Status

• Central Chilled Water Expansion
• In-house planning team
• Existing plant at 94 of peak demand no firm
  capacity
• Chilled Water Storage vital to handle peaks
• Expansion needed to support new buildings,
  including Center for Functional Nanomaterials
• Additional 5,000 tons needed by 2005
• Exploratory meetings with energy development
  companies in progress for last 5 months
• Discussions with NYPA and LIPA Total Energy
  Facility (Cogeneration and chilled water)
• Satellite plant an interim approach
• Chilled water cost would rise

6
Alternative Financing Current Status

• Energy Sciences Building
• Currently above target SLI FY 2004but
• Specifically encouraged by R. Orbach as
  alternative financed projet at Institutional Plan
  onsite review
• 40,000sf Lab/Office demolishes 51,000sf WWII
  buildings
• In-house economic study in progress
• Developer Workshop next 3-6 months
• Likely to require mortgage guarantees Battelle
  support
• Battelle considering their future role in Alt
  Financing decision expected by end of November 02

7
Alternative Financing Economics

• Economics
• Cost savings will be realized
• Energy
• Maintenance
• Operations
• Productivity
• Net costs expected to increase
• Developers desire 15 year amortization
• Borrowing costs are 6-9
• Profit expectations 10-15