How the Feds Are Improving Their Real Estate Usage

August 25, 2017

How the Feds Are Using Data to Right-Size a Massive Real Estate Portfolio

Big Government Equals Big Real Estate

According to the 2016 summary of findings from the Federal Real Property Profile dataset, the U.S. government has 267,000 buildings in its domestic real property inventory—managing over 2.8 billion square feet of buildings. With such vast real estate under management, the federal government is seeking ways to right-size its property portfolio.

A recent Government Accountability Office (GAO) audit revealed that the real estate inventory costs nearly $19 billion annually in operations and maintenance. More than $7 billion is spent in leasing—a number that the government would like to reduce. Buildings are sometimes leased for decades that would have been less expensive to build.

In February 2017, the GAO once again identified real property management on its High Risk List as one of the areas needing attention from Congress and the Executive Office. The GAO further noted that “solutions to high-risk problems potentially save billions of dollars, improve service to the public, and strengthen government performance and accountability.”

Improving Data Collection and Analysis

The key to making more strategic decisions about the property inventory lies in better analysis of data about occupancy and utilization of each piece of property. Like the civilian workforce, the U.S. government has more employees working flexible schedules or telecommuting than ever before. It’s important to determine how much of each building is used, what it costs to maintain it, and whether each space still meets a valuable purpose.

The General Services Administration (GSA) has long maintained a database of the real property of the U.S. government, called the Federal Real Property Profile (FFRP) database. It used to be a static database, but in 2016, GSA launched a new, more dynamic version of the Real Property Management Tool with the goal of collecting and disseminating better information about real property to all agencies. Agencies can view leases and occupancy agreements, rent per square foot, operating costs, information about mission relevance, utilization rates, and maintenance costs for each building. They can compare the performance of one property to another or to the entire government portfolio. A new Asset Consolidation Tool allows agencies to view all federal real estate in a geographic area to identify possibilities for consolidation.

Using Data to Drive Real Estate Decisions

In 2012, the government initiated a “Freeze the Footprint” policy to prevent additional real estate from being added to the real property portfolio. From 2012 to 2015, the federal government has been able to eliminate almost 25 million square feet, saving $300 million in rent, and operations and maintenance costs.

In 2015, the government published a new initiative named “Reduce the Footprint (RTF).” That year, 23 agencies identified more than 7,000 excess or underutilized properties.

Now that better data is being collected for every property, it is easier to identify underperforming assets—those with high costs and poor utilization. A poorly performing building may be able to be remodeled, repurposed or transferred to a different agency that could better utilize it. Other assets could be sold altogether.

According to the GAO, the new Reduce the Footprint strategy will be able to “improve utilization of government-owned buildings to reduce reliance on leasing, lower the number of excess and underutilized properties, and improve the cost-effectiveness and efficiency of the federal real property portfolio.” In order to achieve its goals, the government will focus on improving the quality of its real property data. As you can see, accurate, real-time utilization and cost data is critical to being able to optimize real property, whether it is for the U.S. government or a corporate entity.

Improve Workspace Utilization with Technology

The same types of measurement and analysis employed by the federal government can help your business optimize its real estate footprint. Asure Software’s SmartView solution is a comprehensive workplace utilization analysis solution that helps businesses to make educated, cost-effective decisions about workspace. It employs occupancy sensors to measure accurate, ongoing information about occupancy and utilization and then provides in-depth, interactive reporting dashboards to help you analyze space throughout your entire facility.