Case Study
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Think Tank
Financial Model
A Manhattan think-tank’s mid-town building had served as its “home base” for year, and also generated substantial operating income from commercial leases. Some board members argued that the building was an under-performing asset and an operating burden when real estate market conditions made a sale attractive in order to build an endowment-like financial reserve.
Challenge
The organization’s leadership began a healthy debate over the disposition of the building with thoughtful arguments in favor of and opposed to a sale. At core they asked: what real estate model and asset portfolio would enable the organization to optimally fulfill its mission and ensure long-term sustainability?
Solution
Plan A Advisors led a four-month planning process that engaged stakeholders with a range of viewpoints. Plan A employed creative decision-making structures and a set of agreed-upon goals (financial and programmatic) that brought transparency and objectivity to the board’s determination of the building’s fate.
Process
• Conducted interviews with a diversity of stakeholders and formed a steering committee representing their range of sometimes-competing viewpoints
• Established a set of “guiding principles” to frame the debate and designed a “decision tree” that provided a consistent and visually compelling graphic to accompany each stage in the planning process
• Completed a detailed financial model that analyzed likely capital and operating costs for a set of current and proposed real estate strategies
• Brought the board to consensus around two possible directions and an agreed-upon timetable for a final decision about the disposition of the organization’s real estate
• Crafted the board resolution authorizing a small committee to develop a final recommendation