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GSA’s New Way of Doing Business

Baltimore Multifamily

Thanks to federal budget cuts and the Office of Management and Budget’s Freeze the Footprint program (thank goodness Mother Nature’s Freeze the People program seems to be drawing down), the GSA basically can’t spend any money or grow. Here’s what new GSA administrator Dan Tangherlini is up to.


This morning, TargetGov president Gloria Larkin told us GSA initiatives can take 10 years to get going, but Dan, who’s been on the job just nine months, is already making waves. She’s seeing solicitations in which the GSA will trade unused buildings for construction services on occupied buildings in need of some work. (It's like baseball cards with way bigger stakes.) No money exchanged, no conflict with Dan's mandate not to spend. Regardless of whether such a move ultimately will lose or gain money for the government, it’s a creative way to keep the government running in the here and now, Gloria says.


The GSA also is doing land swaps and enhanced-use leasing. EULs put the cost of renovating, maintaining, and leasing in the hands of private owners, as St. John Properties is doing at Aberdeen Proving Ground’s 416-acre GATE (above, 6120 Guardian Gateway). Dan still faces money problems in 2014 and ’15, though. A quarter of the GSA’s leases (so 44M SF) will expire in the next two years. Gloria tells us the government counts the costs of long-term leases—say, 10-year terms—all in the first year. Short-term leases like three years are more expensive per year, but the cost is pro-rated over the term. What’s a GSA administrator to do?


Down near Fort Meade, contractors are angling for cybersecurity gigs, but office demand isn’t materializing because federal budget cuts are drying up opportunities in other sectors, Gloria says. But there's good news: People whose jobs were relocated from Virginia to Maryland in the BRAC move are finally giving up their commutes, selling their Virginia homes, and moving closer to Fort Meade. That’s good news for resi projects like Ryan Commercial’s Town Center Commons condos in Odenton (above).