Houston Office 'Rightsizing' Makes DOGE's Termination List, Reflecting Broader Confusion
Ronnie Miranda was in the final stages of helping the Occupational Safety and Health Administration plan its downsized lease renewal at a Webster office building when the Department of Government Efficiency included it in a list of leases to be terminated.
But it wasn't a termination. A 1,100 SF downsizing of the 7,200 SF office had already been in the works, the broker for 713CRE told the Houston Business Journal.
The incident is just one of many indicating broad national confusion about the General Services Administration's lease terminations and whether the information being put out is accurate and complete.
The DOGE website did indicate the OSHA lease was a “termination by mass mod,” meaning it is being modified. Three out of four of the Houston GSA listed lease terminations include that description instead of wording such as “true termination,” with additional details such as “agency closed” or “move to federal space.”
Although it isn't a true lease termination, the downsizing of OSHA’s Camino Center II lease at 17625 El Camino Real in Webster will indeed save at least $13K, the number listed on DOGE’s website, according to Miranda.
“They're terminating the lease, as they see it, with the square footage that was in place,” Miranda told the HBJ. “What they're really doing is modifying the lease, or rightsizing it.”
The GSA said in a statement that actively managing leases allows it to “enhance space utilization and secure better terms for the government — including better pricing.”
But pressed for details about properties on the termination list, the GSA guided the HBJ to contact the specific agencies on the list, and those agencies directed it back to the GSA. That aligns with the “pure chaos” that sources involved in federal leasing told Bisnow they are experiencing as they attempt to pin down what exactly is on the chopping block.
The GSA and DOGE had identified nearly 800 leases for termination as of mid-March, but 146 lease terminations have been rescinded for various reasons, and the GSA said more could be spared.
Other lease terminations have become reality. The U.S. Agency for Global Media this month backed out of a full-building lease for its D.C. headquarters that it signed in September.
Houston has also seen its number of properties slated for “accelerated disposition” fluctuate. The list of for-sale federal buildings that was posted, removed, then reposted on the GSA website had 24 Texas properties for sale earlier this month, Chron reported.
There are now only two Texas buildings on the list, including the La Branch Federal Building at 2320 La Branch St. in Houston.
The government isn't communicating well with local property owners, Partners Real Estate Senior Vice President of Research and Market Forecasting Steve Triolet told the HBJ. Houston typically sees GSA leases in Class-B office properties, which are already suffering from weak demand, he said.
“Any cuts, even modest ones, could put additional pressure on this segment of the market,” Triolet said.
