DHS Buys 3 More Detention Facilities From The Geo Group For $950M

A secure facility with high barbed-wire fencing and a locked gate, set against a clear blue sky and concrete pavement.
Desert View Annex detention center

The Department of Homeland Security is continuing its acquisitions strategy with a nearly billion-dollar purchase from The Geo Group. 

Three Adelanto, California, facilities were sold for $950M, Geo announced Tuesday. Desert View Annex, Adelanto West ICE Processing Center and Adelanto East ICE Processing Center total 2,644 beds and already serve Immigration and Customs Enforcement. 

DHS and The Geo Group have a close relationship, as the company has been used by the federal government to hold migrants for four decades. The government is pushing to buy facilities to detain and deport unauthorized immigrants, and Geo and CoreCivic have been its primary sellers.

Geo remains in talks to sell more facilities it owns and manages for ICE to the federal government, though future sales haven’t been confirmed. Its portfolio has 95 community reentry centers, facilities and processing centers, 52 of which are in the U.S., and amounts to 63,550 beds, according to its website.

DHS is also paying Geo and CoreCivic, two of the largest companies in the private prison space, a combined $240M a year to reopen closed facilities.

The Geo Group will pocket $705M in net proceeds from the latest transaction. Among other unnamed uses, the profit will be used to pay down debt and repurchase shares of common stock. Geo's common stock repurchase authorization has also been boosted to $1.25B, a $750M increase. 

ICE’s contract for The Geo Group to provide support services for the three facilities won't be altered by the sale and doesn't expire until 2034 if a five-year option period is accepted.

The Trump administration has renewed and accelerated its push to detain and deport immigrants. 

Earlier this year, the federal government pressed pause on its plan to convert empty warehouses into detention facilities and has listed some of those facilities for sale again. It has instead opted to buy them and has been purchasing properties in bulk to quickly increase capacity. 

That has been good news for The Geo Group’s revenue — its profits were up 63% as of the second quarter. 

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