Dive Brief:

• Lawmakers urged federal agencies to address vacant office space and improve efficiency within their real estate portfolios during a Senate Committee on Environment and Public Works hearing Sept. 27. 
• Senators on the committee called for consistent benchmarks and better space utilization strategies to optimize the federal real estate portfolio.
• Driving the push to modernize federal properties are the increased prevalence of remote work and concerns about the cost and environmental impact of heating, cooling and maintaining underutilized federal buildings. 

Dive Insight:

The U.S. General Services Administration manages over 360 million square feet of space across more than 8,000 buildings. A U.S. Government Accountability Office report that sampled federal agencies’ use of office space across a three-week period earlier this year found that 17 of 24 agencies were using only an estimated 25% of their headquarters buildings. Committee chairman Sen. Tom Carper, D-Del., called the finding “alarming” as well as “not a sustainable or fiscally responsible way to manage our federal real estate.” Based on its calculations for one of the federal headquarters buildings, the GAO estimated that only 67% of building capacity would be used even if all assigned staff entered the building on a single day.

More government employees have been working remotely since the COVID-19 pandemic, catalyzing a renewed focus on the need to modernize the federal real estate portfolio as Americans “watch our federal buildings continue to sit empty,” Sen. Shelley Moore Capito, R-W.Va., said. “Each year, it costs billions of taxpayer dollars to operate and maintain these federal buildings, regardless of their utilization. This is simply unacceptable,” she added. 

Public Buildings Service Commissioner Nina Albert disputed the idea that federal office space is sitting empty. “We hardly have any buildings unoccupied. We have buildings that are underutilized, but buildings that are unoccupied usually move to the disposition list,” she said at the hearing. 

“Federal property management has been on the high-risk list for GAO for 20 years,” noted Sen. Pete Ricketts, R-Neb., during the hearing. “So, this is an ongoing issue, not just an issue created by the pandemic. And certainly, remote work is one of the contributors to the lack of utilization of office space.”

Capito also expressed concerns over wasted resources used to heat, cool and maintain underutilized buildings. “Committees have done a lot of legislative work to support policies that will reduce emissions. I would be interested to know the emissions associated with heating and cooling these buildings that are unoccupied,” she said. 

Carper echoed those concerns, noting that the bipartisan infrastructure law and Inflation Reduction Act gave the GSA “robust funding” to make buildings more energy-efficient and resilient to climate change and promote the use of low-carbon materials.

Capito recommended that federal agencies identify their current and future space needs to help the GSA evaluate lease options or invest appropriately in existing buildings. “Providing these agencies with better benchmarks regarding space and an understanding of what full utilization is would help” with efforts to course-correct and right-size the federal real estate portfolio, she said. Ricketts agreed with that approach. 

Carper noted that more than half of GSA-managed leases are set to expire by 2027, providing an opportunity for such right-sizing. He also touted space consolidation efforts made by the Department of Homeland Security. He cited GSA reports that the work will reduce the DHS footprint by more than 1.2 million square feet in the Washington, D.C., area and save taxpayers $1.3 billion over the next 30 years. 

David Marroni, acting director of physical infrastructure at the GAO, pointed to the importance of having more consistent benchmarks and targets for measuring and determining space utilization. That involves developing more uniform standards for space measurement and assessing what constitutes full utilization rather than using a one-size-fits-all approach, he said at the hearing.