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A Trump administration effort to reduce government spending may result in federally-owned property in Detroit and elsewhere being sold off.
The Patrick V. McNamara Federal Building at 477 Michigan Ave. is among those General Services Administration, or GSA, owned buildings that are deemed by the agency as “non-core,” according to reporting from Wired earlier this week, and could be subject to sale.
The agency did not specify in its response to an inquiry from Crain’s as to which buildings could be targeted for sale, but in a statement said, “GSA is reviewing all options to optimize our footprint and building utilization. GSA is actively working with our tenant agencies to assess their space needs and fully optimize the federal footprint … “
Steve Morris, a longtime commercial real estate broker fluent in the Detroit office market, said it could command $12 to $15 per square foot in a sale based on its location and rent roll, and that the GSA would likely have to hire a national brokerage firm for the undertaking.
The McNamara building was recently selected for a total of $48 million in investment through the Biden Administration’s Inflation Reduction Act, which was for building facade repair, parking garage improvements, improved electrical and lighting systems and electric vehicle charging station installation.
Wired reported there are more than 1,500 GSA-owned properties, of which more than 900 are considered “core” and, for the time being, not subject to sale. Those are things like courthouses, and buildings like border inspection facilities and those with law enforcement uses.
Wired reported, based on government documents it received, that the GSA wants to reduced its owned real estate portfolio by 50%, in terms of square footage, and the number of buildings it owns by 70%. Agencies in those owned federal buildings would shift into private-market leases with whoever buys them.
The McNamara tower not the only GSA-owned building in the Detroit region, although it’s the only building in the Wired-report identified as “non-core” that could be sold off.
Other GSA-owned buildings, according to the agency’s website, include:
• 333 Mount Elliott St., Detroit
• The Detroit Enrollment Center, 2810 W. Fort St., Detroit
• 530 Howard St., Detroit
• The Rosa Parks Federal Building, 985 Michigan Ave., Detroit
• The Theodore Levin U.S. Courthouse, 231 W. Lafayette Blvd., Detroit
• 200 E. Liberty St., Ann Arbor
The GSA is an independent agency and acts as a real estate broker for the federal government. Some 20 or so Elon Musk loyalists are now in the ranks of GSA staff — plus other agencies — since the inauguration of President Donald Trump, all with the task of cutting spending, various news organizations have reported.
Musk, a major Trump donor and a 2024 campaign surrogate, is the head of the new Department of Government Efficiency. The DOGE was established within the executive branch in Trump’s first few days in office.
However, there have been concerns about DOGE for a host of reasons in the weeks since Trump returned to the Oval Office, ranging from accountability and transparency to the cuts themselves.
Musk, through the DOGE, has engaged in efforts to reduce the federal workforce. At the end of January, the GSA sent out a directive to terminate leases on all of the roughly 7,500 federal offices nationwide, The Associated Press reported.
In a statement on Thursday, a spokesperson for the GSA said: “Acting Administrator (Stephen) Ehikian’s vision for the GSA includes reducing our deferred maintenance liabilities, supporting the return to office of federal employees, and taking advantage of a stronger private/government partnership in managing the workforce of the future.”
The GSA maintains some 360 million square feet of real estate, according to a press release announcing Ehikian’s appointment last month.
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