The body that was created to shrink the federal real estate portfolio has zeroed in on a 250-acre redevelopment opportunity just south of the National Mall.
A proposal to launch a massive redevelopment of a cluster of aging federal buildings had been gaining momentum behind the scenes, Bisnow reported last month, and on Tuesday morning it was given a prominent stage at a meeting of the Public Buildings Reform Board.
Bisnow/Emily Wishingrad
Looking down a street in D.C.'s federal southwest corridor.
The board invited Skidmore, Owings & Merrill principal Joseph Ruocco to present conceptual renderings of how 15.3M SF of office buildings in the Southwest D.C. cluster could be transformed into 13.3M SF of mixed-use development with public spaces.
Additionally, the board listed 24 buildings in the D.C. area that are under consideration for its next round of recommendations for disposal — a list that included the entire Southwest cluster.
“It’s the biggest and most obvious area for significant transformation,” PBRB member Dan Mathews, the former General Services Administration public buildings commissioner during President Donald Trump’s first term, told Bisnow after the meeting.
“So many of the buildings are at the end of their useful life and the government has to make a choice — are we going to put billions of dollars into it or are we going to do something else,” he added. “And that choice can’t be postponed much longer because the buildings are falling down.”
The renderings envision multifamily properties in an area that today has no residential, and it also calls for civic, cultural, entertainment, and research facilities. Such a development would benefit from its proximity to the National Mall to the north and The Wharf to the south.
“Southwest Federal Center offers the greatest potential for transformation,” one slide said.
Courtesy of Public Buildings Reform Board
A map presented at the PBRB meeting highlighting the cluster of federal buildings in Southwest D.C. that could be redeveloped.
The buildings in the Southwest cluster include the Forrestal Complex, home to the Department of Energy, the Sidney Yates building, The Bureau of Engraving and Printing, the Wilbur Wright building and the Department of Agriculture South building, where Tuesday’s event was held.
The six-member PBRB board was joined at the meeting by newly appointed Public Buildings Service Commissioner Michael Peters, Executive Director of the National Capital Planning Commission Marcel Acosta, D.C. Office of Planning Director Anita Cozart and Federal City Council Executive Director Anthony Williams.
“All the major stakeholders for D.C.’s future were represented here today,” Mathews said. “And they’re all saying this is a problem that absolutely has to be addressed and they’re all on board with addressing it.”
The PBRB, created in 2016 to advise the federal government on how to downsize its portfolio, has already recommended two rounds of dispositions totaling $775M and is required to make at least one more round of recommendations before the end of 2026.
The board is now analyzing over 40 properties and estimates the next round of sales would produce $19B in cost savings and $1.8B in proceeds from sales. It expects to present an analysis and recommendations by the end of the first quarter.
Bisnow/Emily Wishingrad
The Public Building Reform Board's Tuesday meeting at the Department of Agriculture.
At the meeting, the board showed slides of several dozen buildings in the D.C. area and dozens more nationwide that are under consideration for the next round of disposal recommendations.
Outside of D.C., the board pointed to buildings like LA’s Wilshire Federal Building, Boston’s JFK Federal, Miami’s Brickell Building and Peachtree Summit in Atlanta.
During the meeting, members of the PBRB expressed frustration about the pace of federal disposition and the lack of support they have received.
“Since I’ve been here, we’ve done most of the work we’ve done on our own without a whole lot of help,” PBRB member and former Congressional representative Michael Capuano said.
But they and fellow city stakeholders at the event see the new Trump administration as a chance to capture momentum.
“Everybody is finally — finally — ready to support the legislation that we passed in 2016,” said PBRB Member Talmage Hocker, who is the founder and CEO of The Hocker Group.
“This president has laid it out, he has spoken about it. He wants us to rightsize the federal real property portfolio. So because it’s coming out of the White House, I think we have a better chance than we had in the former administration where this was not in their top five issues.”
The GSA is ultimately the entity that calls the shots on offloading and consolidating property, as it maintains control over the federal government’s 360M SF owned and leased footprint.
New legislation that passed this month gives the GSA a new tool to push forward in disposing of federal property. The act directs agencies and the GSA to monitor occupancy and for properties that are under 60% utilized to come up with a plan to offload them.
The GSA in December announced plans to offload eight buildings across the U.S., including one in the Southwest cluster: the 845K SF Regional Office building at 301 Seventh St. SW. Earlier this month, Congress directed the GSA to sell another building in that Southwest cluster: the Wilbur J. Cohen Building at 330 Independence Ave. SW.
The Cotton Annex, a former federal building at 300 12th St. SW, has already been transformed into a 562-unit residential building. Carmel Partners delivered the project last fall after it sat vacant for nearly two decades.
During the question and answer session at the end, former PBS Commissioner Bob Peck implored the board to try not to fixate on which properties can garner the most value.
“There has been a tendency in the past to worry about ‘Oh my gosh this asset might not sell at the highest end of the market and we won’t make our mark for how much money we’re making off it,’” he said, noting that it’s important to realize office values have shifted, and that in addition to direct monetary value, offloading properties also rids the government of the liability of maintaining them.
PBRB Executive Executive Director Paul Walden said the board is planning more sessions like Tuesday's to gather public input, and he gave an outlook on what the board hopes to prioritize.
“What we’re planning to do is look at markets that have both a strong federal presence and have a relatively strong real estate market and to consult with the local real estate community to get their input on what they perceive are opportunities for disposal or consolidation,” he said
Walden highlighted other cities of focus for the board, including Atlanta; Miami; Fort Lauderdale, Florida; San Antonio, Kansas City and St. Louis, Missouri; Philadelphia and Minneapolis, where he said the board is also planning stakeholder engagement.