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Disposing of Unneeded Federal Real Estate

Disposing of Unneeded Federal Real Estate. SAME Luncheon. August 2011. John E.B. Smith. $3 billion by 2012, $15B by 2015?. President ‘s June 2010, memo ordered federal agencies to use less space in an attempt to save $3 billion by 2012 by: disposing of unneeded Federal real estate,

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Disposing of Unneeded Federal Real Estate

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  1. Disposing of Unneeded Federal Real Estate SAME Luncheon August 2011 John E.B. Smith

  2. $3 billion by 2012, $15B by 2015? President ‘s June 2010, memo ordered federal agencies to use less space in an attempt to save $3 billion by 2012 by: • disposing of unneeded Federal real estate, • increasing sales proceeds, • cutting operating costs • innovative workplace strategies and, • improving energy efficiency.

  3. Civilian BRAC Proposals $15b by 2015; $19b by 2020 • Several versions and ideas about how to organize and execute • Any reform to real property asset management must address these central challenges: • Incentivizing disposals by enabling agencies to realize the benefits of proceeds • Addressing the upfront costs associated with disposals and consolidations • Resolving competing stakeholder interests that can slow down or prevent good asset management decisions

  4. Disposing of Unneeded Federal Real Estate Space Optimization • We need to look at the way we work differently and adopt policies to reflect that. • It’s time for the Fed to get creative. • Increase utilization by engaging a mobile workforce. • Make technology work for our workforce

  5. GSA’s Three Pronged Approach • We expect to use a three-pronged approach to meet the President’s goal: • First, we must dispose of vacant or otherwise underused properties. Low lying fruit. • Second, GSA will be asking agencies seeking new leases or new construction to reduce their square-footage requests and increase their reliance on mobility or other workplace strategies to reduce their space needs. • Third we must begin eliminating lease arrangements that are not cost effective as one way to reduce unneeded space. • We expect step two and three will provide additional space for repositioning.

  6. Our Approach to Analyzing Opportunities Step 1: Identify buildings with poor performance and low mission impact/risk • Operating $/SF • Energy Use/SF • Low Utilization (Employees/SF) • High Mission Impact • High Risk • Low Mission Impact • Low Risk • Step 2: Buildings are mapped to look for opportunities: • Consolidation • Improved work space efficiency • Collocation

  7. XXX Excess Facilities by GSF – • Data Selection: • - using Organization is XXX, • Exclusions: • “Land” property type • “Service” (other than buildings) • “Storage” (other than buildings) property use

  8. Agency Space trends • Historic Data based on assignable RSF - Active buildings, • Differs from FRPP, which includes GSF(not RSF) for Active and Excess. • Differs from Budget Figures, which are billable RSF only.

  9. Number of Facility Leases by Lease Expiration Year

  10. Operating Costs of XXX Occupied Owned Space 2010 Government-wide Operating Costs exceeded $33b!

  11. Mobility and Space Utilization This is a huge inefficiency.

  12. GSA Central Office Space Optimization Phased renovation 2010-2014 • Administrator Johnson challenged PBS to fit all of the Washington GSA operations into the Headquarters facility at 1800 F St, NW, Washington D.C. • Renovation will increase building size approximately 100K sq ft • Finished product will have approximately 2600 seats • GSA employee population in D.C. approximately 6000 personnel • How can we develop the correct mix of productivity and office utilization? • Industry leader visits • Other government agencies, other governments • Look inwardly for solutions –share your stories! • Leverage solutions

  13. What if the Civilian BRAC doesn’t pass? Space Optimization • We need to look at the way we work differently and adopt policies to reflect that anyway. • It’s time for the Fed to get creative. Right now. • Increase utilization by engaging a mobile workforce. Just do it! • Make technology work for our workforce – its 2011!

  14. Collaboration - Productivity Nottingham-Spirk is known for its inventions and open innovation process have garnered more than 900+ worldwide commercialized patents. They moved into an old church without partitions to separate teams and the laundry detergent team collaborated with the paint can team and created the Twist and Pour paint container. Dutch Boy Twist & Pour paint container quickly tripled sales of this Sherwin-Williams brand and was named one of the Ten Best Packages of the Decade.

  15. Collaborate and Share, Blend, & Create New Ideas • Builds web-based productivity tools • New ways to conceptualize working and creating • M&M’s distractions • No talk Thursdays Steven Johnson. • English Coffee House – brought the age of enlightenment • Recommends we design our offices like the coffee shop – open, collaborative, an incubator for ideas. Jason Fried. Most of our offices need both concepts to operate – blending good ideas

  16. Questions What impact will this action have on the market? What impact will the current real estate market have on the process? What are some of the obstacles agencies are facing to meet the objectives in the President’s Memo to reduce unneeded real estate holdings? What assistance can GSA provide to agencies to assist them in meeting the goal? Don’t you need up front capital investments to accomplish many of the activities to reduce real property inventory? Can you cite some examples where agencies have reduced space using alternative work solutions/mobility? What about the Federal budget?

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