National CRE News In Your Inbox.
Sign up for Connect emails to stay informed with CRE stories that are 150 words or less.
Trump Administration Weighs Putting Federal Office Space on the Chopping Block
The Trump administration is considering the sale of two-thirds of the federal government’s 363 million square feet of owned office real estate to the private sector, the Wall Street Journal reported. On top of that, about three-quarters of the 70 million square feet of space the General Services Administration leases from private landlords in Washington, DC–nearly half the national total–is likely to be canceled. reported the WSJ.
Much of the DC office stock the GSA can sell will likely come to market at fire-sale prices, developer Don Peebles, long a presence in the DC market, told the WSJ. That could drag down the worth of other DC office buildings, which have already plunged in value in recent years.
“Buildings will sell for 30 cents on the dollar,” Peebles said. “It’s a paradigm shift. There will be a dramatic reset on property values.”
S&P Global estimates 52% of the federal government’s office leases are eligible for termination through the end of 2028, when President Trump’s second term ends, the Business Journals reported. The Business Journals quoted Trepp senior research manager Thomas Taylor as saying early terminations of a significant share of those leases would cut a lot of rent from the landlords’ income statements.
Pictured: GSA headquarters in Washington, DC.
- ◦Lease
- ◦Sale/Acquisition
- ◦Policy/Gov't
