Federal Office Lease Expirations
Commercial Observer
Connecting and informing industry leaders of trends and individuals defining the global commercial real estate landscape
More than half of the federal government’s office leases are set to expire by 2029 or have termination clauses that could be exercised by then. That amounts to well over 77 million square feet. Also for today: Amazon buys 200 acres in California’s Inland Empire for a new industrial complex.
Enjoying these stories on all things real estate? Unlock unlimited access to our content with a subscription.
— Tom Acitelli, Deputy Editor
More Than Half of Federal Office Leases Vulnerable to Cuts by 2028
Turns out Elon Musk and Vivek Ramaswamy may have an even easier time cutting the size of the federal government than previously thought. Some 52 percent of the federal government’s office leases nationwide are set to expire or have termination options by the end of 2028, according to a recent report by S&P Global Ratings. That cumulatively amounts to about 77.7 million square feet — 59.2 million of expirations and 18.2 million of termination options over the next four years — of the nearly 150 million square feet the government currently uses across about 7,000 separate leases. The total cost of the 7,000 leases is about $5.5 billion per year, with the average lease over the past 10 years extending about 21,000 square feet, per S&P. The chance to cut that by more than half is potentially inspiring news for the heads of the newly formed non-government Department of Government Efficiency, or DOGE for short.
领英推荐
Amazon Pays $162M for 200 Acres in California’s Inland Empire
When it comes to warehouse space in the Inland Empire, Amazon keeps on delivering. The e-commerce giant in October paid $161.9 million for 200 acres in Hesperia, Calif., a site entitled for about 2.5 million square feet of industrial space, Bisnow reported on Wednesday. Dallas-based investment firm Covington Group sold the land. An Amazon spokesperson confirmed the deal, though did not comment further. Grading is already underway at the property, per Bisnow, dubbed Hesperia Commerce Center II in city planning documents from 2022. The site is directly south down U.S. Highway 395 from an Amazon fulfillment center at 18580 Gateway Drive near Victorville. Representatives for Covington did not immediately respond to requests for comment.
Enjoying these stories on all things real estate? Unlock unlimited access to our content with a subscription. And for a daily version of this newsletter, sign up here.