House Republicans Pressure GSA to Sell Washington Warehouse

In the latest of a two-year series of field hearings at vacant federal properties, a House Oversight subcommittee on Thursday grilled the General Services Administration over how long it is taking to sell off a vacant warehouse in Southeast Washington near the Navy Yard.

“I’m continuing again to try to highlight public assets that sit idle or are undertilized,” said Rep. John Mica, R-Fla., chairman of the House Oversight and Government Reform Subcommittee on Government Operations, in a later interview with Government Executive. “It’s just a pattern of not being able to make decisions, and it’s remarkable given that we’re in the nation’s capital.”

Republicans have been critical of what they see as GSA’s slow pace in selling such properties as the Old Post Office Building, now leased to Donald Trump for conversion to a hotel, and the Georgetown West Heating Plant. The plant is being readied for purchase by a developer working with Four Seasons hotels to construct apartments as well a public park along the C&O Canal.

Efforts to sell off federal property often take more time than comparable private sector deals, some say because of bureaucratic inertia. Others cite laws requiring GSA to consult with other federal agencies, neighborhood groups, local government and advocates for the homeless who could have first claims to the property.

Michael Gelber, acting deputy commissioner of GSA’s Public Buildings Service, used the hearing to review the Obama administration’s three-year campaign to generate revenues for deficit reduction by accelerating the sale of obsolete properties. “Since 2008, GSA has disposed of 93 of our federally owned assets, generating proceeds of more than $134 million,” he said in written testimony. “When we identify vacant space in areas where a continuing federal need exists, GSA works aggressively to reuse the asset, renovating as necessary to achieve greater utilization. As a result of our efforts, our vacancy and utilization rates lead the market average.”

Gelber noted that the Office of Management and Budget has backed a plan to create an independent board to package and propose properties to be sold in a manner similar to the Pentagon’s Base Closure and Realignment Commission. Rep. Jeff Denham, R-Calif., of the House Transportation and Infrastructure Committee has long pushed legislation to create a civilian board. Denham has worked with Mica on many of the field hearings.

The vacant Southeast warehouse, built in 1924, consists of 32,013 square feet of rentable space on seven-tenths of an acre in the “fast-growing Capitol Riverfront neighborhood,” Gelber said. It was formerly used by the Joint Chiefs of Staff but had deteriorated to the point where GSA began considering a sale in 2008. The U.S. Court of Appeals for Veterans Claims considered taking over the space but abandoned its plan as too costly. The Architect of the Capitol also expressed interest. GSA is now exploring a plan to exchange the facility with a private entity for services, Gelber announced. A federal tenant who had inquired about the property backed out days before the hearing.

GSA now sees the blossoming amenities in the surrounding real estate market as an opportunity to make a sale to benefit taxpayers, Gelber told lawmakers. Overall, he said, GSA has “a robust asset management program to track the utilization of our inventory.”

That claim was not backed by a recent Government Accountability Office study concluding that data problems continue to hamper federal efforts to sell off excess properties. David Wise, director of GAO’s physical infrastructure program, told the committee that at 23 of 26 properties visited auditors had identified inconsistent and inaccurate data on their use, condition, annual operating costs and value.

GAO’s report noted a “comprehensive, long-term national strategy would support better management of excess and underutilized property by, among other things, defining the scope of the problem; identifying achievement goals; addressing costs, resources, and investments needed; and clearly outlining roles and coordination mechanisms across agencies.”

Lawmakers also heard from D.C. Councilman Tommy Wells, who favors converting the warehouse into a market complex. “Indicative of the new energy developing in the neighborhood,” he said, “neighbors have worked together to outline a proposal for a creative reuse of this particular building -- known as the Half Street Market initiative.”

Ed Kaminski, the area’s advisory neighborhood commission member, said in written testimony that he would favor using the property for an “educational-commercial partnership” to create a new institute for culinary business education.

Mica said he is also expecting GSA action soon on a proposal to sell the Agriculture Department’s now-vacant Cotton Annex in Southwest near the National Mall, saying “it is also stuck in their bureaucratic red tape.” Noting that his new assignment as subcommittee chairman gives him broader jurisdiction than his previous post heading Transportation, Mica said, “I’m hammering them.”

Mica said he will soon pressure the administration to sell off parts of the Agricultural Research Service’s complex in Beltsville, Md. “We’re looking at 7,000 acres,” he said, “the size of the city of Key West [Fla.], with 500 buildings -- 200 of which are vacant or derelict.”

Correction: An earlier version of this story incorrectly stated that the properties audited by the Government Accountability Office all were owned by the General Services Administration.