GSA Administrator Says No 'Grand Plan' For Selling Federal Buildings

In his first appearance testifying before members of the House of Representatives, President Donald Trump’s new General Services Administration head told lawmakers that his team is focused on creating new federal neighbors to free up buildings to sell.

Testifying on Capitol Hill Wednesday, Edward Forst — the former CEO of brokerage giant Cushman & Wakefield who was sworn in as GSA administrator in December — told lawmakers that the GSA has three or four different opportunities to colocate agencies in buildings together. 

“I am very optimistic right now about several conversations that we have underway where we will have two agencies combined in the same space,” he told the House Subcommittee on Economic Development, Public Buildings and Emergency Management.

“We've lived in a world of sovereignties where each agency needs its own building, its own fax machine, its own everything,” he said. “And I'm now quite heartened by the fact that we have three or four possible combinations, one of them in the headquarters building of my agency.” 

The “twinning” strategy, as Forst called it, will help speed along the process of offloading some of the most distressed properties in the federal portfolio, sales that he hopes will unlock cash that can then be put back into the rest of its owned portfolio.

But despite hundreds of buildings being listed as targeted for sale at one point last year, he said the government's real estate arm is taking a more deliberate approach under his leadership.

“We do not have a grand plan for the disposition at this point,” he said. “We are looking at buildings that are not needed, and we're trying to be more expeditious about realizing return on those and moving the people out of underutilized real estate into areas, collaborating together so we have more density of usage, because that's an intelligent design as well.”

Forst used part of his first appearance before the subcommittee, which is tasked with GSA oversight, as “show-and-tell” to display the dire state many federal buildings are in and make the case for his agency to have more control over its own funds. 

He said a ceiling had caved in over the weekend over an employee’s desk at the FBI’s J. Edgar Hoover Building, and he brought a piece of concrete that had fallen from the exterior of that crumbling property to drive the point home. He showed slides of the damage to federal buildings, including a hole in the wall of GSA’s own headquarters at 1800 F St. NW.

He asked that the GSA be allowed to hold on to more of the funds that it collects from agency leases so that it can funnel that into sorely needed building maintenance and improvements. While the GSA has previously estimated its portfolio needed $26B worth of repairs, Forst said Wednesday the true need is likely “tens of billions” more.

He also argued to raise the cap that the agency can spend before having to get clearance from Congress. That cap is $3.96M, he told lawmakers, a sum that barely covers the cost of three new elevators.

“These are not issues that should require a lot of debate, if we want to replace a boiler, a roof,” he said.

Forst, who was Cushman & Wakefield's CEO between 2013 and 2015 after a long stint at Goldman Sachs, is just getting his feet wet 2.5 months into the job. 

He comes to the role after a chaotic year for federal real estate, during which the GSA saw a revolving door of leadership, massive staff cuts and the mass confusion wrought by Elon Musk’s Department of Government Efficiency. Forst is the first confirmed head of the GSA since Trump started his second term.

“I must say, it's been a tumultuous 14 months for GSA,” Rep. Rick Larsen, a Democrat from Washington state, said in his opening remarks. “Staff have been reduced. Regional offices shuttered. Building sustainability goals eliminated. Leases terminated, then reinstated. Buildings have been on and off and on and off the disposal lists.” 

The federal government has long been working to shrink its owned and leased footprint. But the Trump administration came in moving fast and furiously. Its efforts have so far resulted in some big headquarters relocation announcements but haven't yet resulted in any big dispositions.

During Forst’s tenure, the GSA announced it will dispose of the 2.2M SF brutalist Agriculture South Building near the National Mall. That follows public listings of the Department of Energy's 1.7M SF James V. Forrestal Building, the 1.2M SF Wilbur J. Cohen Building, the GSA’s 845K SF Regional Office Building, and the Department of Housing and Urban Development's 1.1M SF former headquarters, all in Southwest D.C.

Forst told lawmakers that he met with D.C. Mayor Muriel Bowser this week to discuss ways to explore redevelopment options for the federal portfolio in the city. He also acknowledged that announcing a building is up for sale while it is still in use causes “tremendous disruption” to its staff.

He said the GSA would look to engage private brokerages for advice based on market research to determine how best to play out the disposition process, citing his experience running Cushman & Wakefield.

“I think we need the intelligence and we don't just run down a path,” he said. “That's why I'm not a fan of just putting something on a website, putting it out there and having it happen. I think we ought to curate this process to maximize the benefit to the taxpayer.”