As Musk Exits, DOGE’s Shock And Awe Campaign Against Office Space Grinds On

Elon Musk came to Washington, D.C., on a mission to cut costs and find inefficiencies. He almost immediately aimed his chainsaw at the federal government’s commercial real estate footprint. 

His Department of Government Efficiency at one point promised to sell as many as 443 buildings and vacate another 10M SF worth of leases. As Musk decamps from the nation’s Capitol, the federal government has targeted less than 7M SF in its footprint for termination, and much of that space is still occupied. 

DOGE, the quasi-public agency spearheaded until last week by Musk, arrived in Washington with shock and awe. Despite the outsized promises, the agency has made relatively little progress, but the space-saving part of its mission is charging forward inside President Donald Trump’s White House. 

“DOGE came in with a huge splash and, in my opinion, did very little,” said Darian LeBlanc, an executive vice chairman at Cushman & Wakefield leading the brokerage’s government services group. “Now what we're seeing is the administration taking a more traditional approach to changes in the federal government at an agency level, and that may ultimately drive changes in the real estate.”

The federal government’s approach to shedding space has evolved since Trump began his second term. The General Services Administration has been focused on cutting its footprint for more than a decade, and the pledge from Trump and DOGE to cut up to half the government’s 173M SF of occupied office space is an attempt to supercharge the process. 

Through the end of May, the GSA has terminated 6.7M SF worth of leases, accounting for roughly 3.8% of the federal government’s leased footprint, according to agency data. That’s more than triple the 2M SF of space savings the federal government achieved in 2024 but is still broadly in line with a decade-long effort at the federal level to cut space.

“If everything ended today and it’s just that much space that’s canceled, it’s a drop in the bucket of water, whether you’re talking about the U.S., the DMV or D.C.,” Tucker White, office agency research lead at Avison Young, said, using an acronym for the broader Washington metro area. 

Announcements from the GSA in the early days of the Trump administration sowed chaos across and beyond the Washington office. By the sixth week of the Trump administration, DOGE had identified 748 leases totaling 9.6M SF it said the government would vacate. 

“My phone started ringing nonstop shortly after the administration came into office just because of all the press and the noise around DOGE,” said Gordon Griffin, an attorney at Holland & Knight who focuses on GSA leasing and federal real estate. 

The waves of lease terminations released by DOGE rattled office owners, he said. But owners’ immediate concerns were alleviated as the lists were pulled offline and amended in the days that followed. Hundreds of the properties caught up in the maximalist approach to space savings would be necessary to keep the federal government running, the government found. 

“We still have a lot of new business coming in, but it’s not quite as urgent and time-sensitive anymore,” Griffin said. 

The list of properties for sale, which initially included the headquarters for the FBI, Department of Justice, Department of Labor and a host of other agencies, was whittled down to eight locations later in March and has since grown to 46 properties. 

DOGE also removed 135 leases from the planned termination list in March, the same month the first list was released. A spokesperson for the GSA told Bisnow at the time that more leases were likely to be saved.

“GSA’s letters of intent to terminate have no immediate effect and do not mean the lease has been terminated,” the spokesperson said. The GSA didn’t respond to Bisnow’s request for comment for this story.

The Trump administration’s broader cost-cutting efforts have not spared the GSA, where 600 employees were laid off in March in the first round of ongoing staffing cuts. As many as half of GSA staffers could be targeted for layoffs, and the exit of veteran employees is already impacting services and leading to significant delays. 

“All of the leasing professional staff were [laid off] overnight, and leases have been reassigned to people who aren't familiar with the background and history,” Griffin said. “I’m in litigation on several matters where I'm on my third or even fourth attorney assigned to the case.” 

While branded as radical, the efforts from DOGE and the White House to slash the federal footprint are more an acceleration of existing policy. A 2015 policy framework from the Office of Management and Budget directed federal agencies to aggressively sell surplus real estate, and the GSA cut its office footprint by about 20% in the decade ending in 2023. 

On his way out of the White House, Joe Biden and Democrats in Congress used an unrelated water resources bill to push the policy further, adding language to the legislation that required the GSA to maintain a 60% office utilization rate at each property in its portfolio.  

The budget debate in Congress has refocused lawmakers on the mission of specific agencies rather than the number of floors it occupies, LeBlanc said. Space savings in the near term are likely to be driven by the Trump administration’s effort to reset federal policy priorities. 

“Whether you're talking about [the National Oceanic and Atmospheric Administration], whether you're talking about the National Science Foundation, all of these agencies are undergoing massive change that’s not necessarily driven by DOGE, but is being driven by the administration,” he said. “Focusing on real estate as a driver to change the agency is a misnomer. The agency will change, and then the real estate will follow.”

GSA lease terms typically allow agencies to be shuffled between leased buildings, and the government has been consolidating its footprint into its most modern properties the same way that private sector leasing has been driven by the flight to quality spaces, LeBlanc said. 

Nearly 80% of the space the federal government has announced it plans to exit in the Washington metro area since the start of the year is Class-B or below, according to Avison Young.

In some markets, the federal government is planning to launch pilot coworking programs that are similarly aimed at pushing multiple agencies into high-quality space. The size of the federal workforce and number of agency headquarters in Washington makes coworking an unlikely solution for the capital, LeBlanc said. But the space consolidation efforts will still push workers into the highest-quality properties. 

Many of the federal government’s older properties are well-located in urban cores and are prime candidates for conversion or redevelopment, said Avison Young’s White. They are unlikely to be added into overall office inventory if vacated by the government, preventing some of the properties from weighing on overall market fundamentals, he said.  

The high-profile pronouncements and sweeping plans to offload real estate have thus far been more show than substance. But commercial real estate transactions aren’t known for their speed, and Musk pledged in a post to X, his social media platform, that the mission of DOGE “will only strengthen over time as it becomes a way of life throughout the government.”

Despite all the efforts of Musk, who spent most of his career as a political outsider, to reshape Washington, the wholly precedented, centuries-old budget process is likely to do more to shape the federal footprint than anything DOGE has done to date, LeBlanc said.

“A lot of people spend a lot of time thinking about DOGE and about what it was going to do. Ultimately, it did some things, but not nearly what they set out to do,” he said. “The more critical changes are going to be brought about over the course of the next five or six months as a result of the budget.”