MetroPCS Case Study

In 2007 Spencer Commercial (SCRE) completed the execution of a multi-phase real estate strategy for MetroPCS, a provider of wireless communications services with corporate headquarters in Richardson, Texas.  MetroPCS owns or has access to licenses covering a population of approximately 140 million people in 14 of the top 25 largest metropolitan areas in the United States, including New York, Philadelphia, Boston, Miami, Orlando, Sarasota, Tampa, Atlanta, Dallas, Detroit, Las Vegas, Los Angeles, San Francisco and Sacramento. Additionally, MetroPCS has over 3.6 million subscribers and offers service in the Miami, Orlando, Sarasota, Tampa, Atlanta, Dallas, Detroit, San Francisco, Los Angeles, and Sacramento metropolitan areas.

The Real Estate Challenge

When MetroPCS engaged SCRE in 2005, its subscriber base was fiercely growing.  (In its first year, MetroPCS earned more than $129 million.  This past year, it posted a profit of $147.5 million on revenue of $1.64 billion, up from a net income of $70.6 million and sales of $1.09 billion for the same period in 2006.)  Key to the MetroPCS offering is its retail stores located throughout each of its metropolitan service areas.  Additionally, it had already outgrown its headquarters, but had no corporate real estate structure.

The Strategy

Enter SCRE.  Together with MetroPCS, SCRE evaluated the long- and short-term corporate business objectives and developed a corresponding real estate strategy to be used as a catalyst in achieving their goals, which included positioning for an initial public offering (ultimately occurring in April 2007 for $1.5 billion).  SCRE developed and implemented a corporate growth strategy and corporate real estate model, providing the company with effective long-term real estate strategy as they prepared for IPO.  The strategy included:

• relocation strategy with a recommended 120,000 square foot headquarter move to Richardson
• development of a comprehensive retail store site selection process based on specific market and location analysis in conjunction with key performance indicators
• provision of project management for 28,574 square feet, including 135 employees in four divisions
• development of a facility management department, including detailed structure and policies and procedures for the division
• provision of outsourced facilities management for two-years, encompassing 312 people and 78,132 square feet

The Value-Add

At the completion of the project, MetroPCS had realized more than $1 million in savings due to a wide variety of strategy implementations – better positioning the company for its impending IPO.  Today, MetroPCS holds the record for the largest IPO for a Texas-based company.