ULI Washington News

Federal Government Office Supply and Demand Recap

By Anthony Balestrieri
May 1, 2012

Edward V. Gregorowicz, Jr., Principal, Avison Young
John Holloway, Director, OBMS, Transportation Security Administration, DHS
Elaine Clancy, Director of Leasing, General Services Administration – NCR
Bradley Provancha, Deputy Director, Facilities Services Directorate, Washington Headquarters Services

This panel focused on the major influences and challenges facing the constantly shifting government real estate landscape.  Specifically with major cuts proposed in the Federal Government budget, agencies need to become more efficient and effective in their ownership and leasing of real estate assets. These changes have a significant impact on the Washington, DC National Capital Region as the GSA and its agency clients alone represent over 43.3 million square feet of owned space and 57.7 million square feet of leased space with annual lease payment totaling over $2.0 billion.

The panelists all agreed there are significant challenges facing government real estate in today’s complex regulatory, fiscal and political environment including challenges to maintain best in class facilities and provide appropriate real estate solutions for a modernizing workforce.  Additionally, users of government controlled real estate are tasked with achieving green buildings, maintaining appropriate security standards, staying under budget and incorporating the latest technology.

The biggest trend affecting government real estate right now is the dual mandate to incorporate the latest technologies and decrease the footprint of the average government employee.   Specifically, the panelists described two prime examples.  First, the GSA has been tasked by OMB to reduce the average square feet per employee from 300 square feet/employee to a goal of 200 square feet /employee.  Second, the Washington Headquarter Services which controls all DOD real estate in the Washington Area, with an estimated replacement value of 620 billion, has decreased its footprint by over 15% since 2003.

According to our panel the Future Trends to be aware of are the increasing role of teleworking, which according to one of our panelists approximately 50% of agency employees will be doing some time in the very near future, a continued effort towards “Government First” solutions for real estate needs before accessing the private sector and the ambitions goal of right sizing the government real estate footprint through a 7% decrease in government controlled space.

Our final panelist, John Holloway from DHS, spoke to all these Future Trends by highlighting a recent real life case study detailing his work at the Transportation Security Administration (TSA) at their Headquarters location.  Through the successful implementation of a new teleworking program the TSA decreased the average employee footprint from 168 square feet/employee to 120 square feet/employee.

In conclusion our panelists agreed today’s government real estate professional is required to do more with less, yet achieve a higher level of operational success.  Which, as one participant pointed out is increasing harder to do achieve since, “it takes money to save money, but right now we do not have any money.”

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