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Housing privatization to begin at six bases

by Michael Briggs
Air Education and Training Command Public Affairs

9/20/2007 - RANDOLPH AIR FORCE BASE, Texas (AFPN)  -- Improved living conditions for Airmen and their families at six Air Education and Training Command bases will become a reality Oct. 1.

That's when Pinnacle-Hunt Communities, LLC, as the selected housing developer for the AETC Group II Housing Privatization program, will take charge of the design, construction, renovation, maintenance and management of 2,199 units at Columbus AFB, Miss.; Maxwell AFB, Ala.; Vance AFB, Okla.; and Goodfellow , Laughlin and Randolph Air Force bases in Texas.

Under the terms of its 50-year agreement with the Air Force, Pinnacle-Hunt will build 420 new units, renovate nearly 1,300 units, and provide maintenance and management of about 500 units that require no renovation, said Garrett Smith, AETC Group II project manager at the Air Force Center for Environmental Excellence at Brooks-City Base, Texas. The project also involves demolition of more than 720 units that are excess to AETC's needs.

The demolition, construction and renovation projects should begin within six months and will be completed by March 2011, Mr. Smith said. Each base has a construction manager who will communicate project timelines with the local base community to keep residents informed of the activities that will affect them. Projects will be conducted in phases to minimize disruption during construction with the goal of moving people only once and only if necessary.

"Housing privatization provides our Airmen and their families with the best housing possible in these times of leaner construction budgets and limited resources," said Gen. William R. Looney III, AETC commander. "This quality of life initiative guarantees we'll be able to house our families in comfortable, well-maintained homes for years to come."

The general said the command will receive a return of about $4 in value from Pinnacle-Hunt for every $1 the Air Force invests. Military construction projects can't match that value.

"Privatization offers the best way forward in terms of the quantity and quality of housing we can offer our Airmen," General Looney said. "We'd like to be able to build new housing units for all of our Airmen and their families, but fiscal constraints do not allow that option."

The transition to Pinnacle-Hunt housing management should be seamless for most base housing residents.

"Under the program, residents sign a lease with the housing developer similar to landlord-tenant agreements for apartments and rentals on the economy," said Col. Mark Pohlmeier, AETC civil engineer. "Every basic allowance for housing dollar goes directly back into the housing project to ensure residents receive quality housing and services for the next 50 years."

A key aspect of housing privatization is the "lock box" that sets aside part of the rent, in the form of members' BAH, for scheduled and reoccurring maintenance and recapitalization of the housing, Colonel Pohlmeier said.

"This is not only a 50-year deal with the housing developer, it is also a 50-year commitment to provide quality housing for our Airmen and their families," the colonel said

Pinnacle-Hunt is a joint venture between Hunt ELP, Ltd., and Pinnacle AMS Development Company, LLC. Pinnacle is a well respected property management firm that has closed five privatized military family housing projects totaling 11,485 units with development costs in excess of $1.6 billion within the past five years, Colonel Pohlmeier said. Similarly, Hunt has closed 15 privatized military family housing projects totaling 20,000 units with development costs in excess of $2.9 billion within the past seven years.

Congress established the Military Housing Privatization Initiative in 1996 as a tool to help the military improve the quality of life for its service members by improving the condition of their housing. The program was designed and developed to attract private sector financing, expertise and innovation to provide necessary housing faster and more efficiently than traditional military construction processes would allow, according to information from the Office of the Deputy Under Secretary of Defense for Installations and Environment.

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