Title: Underused Federal Office Spaces

Description: The federal government has 500 million square feet of
office space, which costs billions of dollars each year to lease,
operate and maintain. But many of these buildings are under-occupied.
This is a long standing problem, but one that increased during COVID-19.
We'll find out more from GAO's David Marroni.

Related GAO Work: GAO-23-106200, Federal Real Property: Preliminary
Results Show Federal Buildings Remain Underutilized Due to Longstanding
Challenges and Increased Telework

Released: July 2023

[Music]

[David Marroni:] Now is the time for the federal government to act and
decide how much space it really needs.

[Holly Hobbs:] Hi and welcome to GAO's Watchdog Report--your source for
fact-based, nonpartisan news and information from the U.S. Government
Accountability Office. I'm your host, Holly Hobbs. The federal
government is one of the largest employers in the United States. So
naturally, it has a lot of office buildings for its workers.
Specifically, the federal government has 500 million square feet of
office space; and it costs billions of dollars each year to lease,
operate and maintain them. But many of these buildings are under
occupied. They have empty spaces. This is a longstanding problem, but
one that increased during COVID-19. So what's causing this issue, and
what's its impact? We'll find out more from GAO's David Marroni, who
testified before Congress today on this issue. Thanks for joining us.

[David Marroni:] Thanks, Holly. Happy to be here.

[Holly Hobbs:] So David, you testified this morning in front of
Congress. Why was Congress interested in this topic? What did they want
to know?

[David Marroni:] So Congress wanted to know how much are these buildings
actually being used. They know this is a longstanding problem. We've
been highlighting it for over 20 years. And after the pandemic, knowing
fewer federal workers are going in, it's how much space is being used.
And do we really need all this space? It all costs money. 

[Holly Hobbs:] What's the scale of the issue here? How many buildings or
spaces are under occupied?

[David Marroni:] So we focused on the headquarters buildings for 24
agencies in D.C. And what we found was that all 24 of those buildings
had extra space. In fact, most were using less than 25% of their
capacity. And while we didn't look at federal buildings outside of D.C.,
we expect we'd find similar issues there. 

[Holly Hobbs:] And there are empty office spaces all over the United
States, especially in the wake of COVID. But how is this different for
the federal government?

[David Marroni:] Yes. So you're definitely right. This isn't a problem
that's specific to the federal government. A big difference is the
private sector is able to shed unneeded space a lot easier than federal
agencies can. The federal process is complicated and can take quite a
long time. And that's one of the reasons we've had that issue on our
high risk list now for 20 years.

[Holly Hobbs:] And so we kind of talk to this. COVID emptied a lot of
office buildings. But you said this is a longstanding issue for the
federal government. Do we know why?

[David Marroni:] Yes. So the federal government's embrace of hybrid
work, lots more telework, certainly has something to do with this. There
just fewer people coming to the office, right? And that's definitely one
of the causes of low utilization. But there's two others. First, that
the federal government has been holding on to more space than it needs
for years. That predates the pandemic. And some of that's just due to
the age of the buildings. These headquarters are decades old. Things
have changed over time. We have better technology. We can do more with
fewer workers. But the building size doesn't change. So you have fewer
workers in the same sized buildings. That leads to unneeded space.
Second reason is simply that these buildings aren't always configured in
the best way. Think of things we no longer really use much of in the
digital age??libraries, storage spaces for big files. We don't really
need that kind of space anymore, but it costs money to reconfigure that
to better use the space and agencies often don't have that money to
invest in their facilities.

[Holly Hobbs:] What's the cost of all this to the government and
taxpayers?

[David Marroni:] So the most obvious is obviously financial cost, right?
It costs billions of dollars each year to operate these federal
buildings, whether they're being used or not. And so the more unneeded
space you have, the more taxpayer money that's going to be wasted.
There's also environmental cost, though. It takes a lot of energy to run
these buildings. And that means emissions that could be harmful to the
environment. And then the last cost is an opportunity cost, right? The
federal agencies are having to spend money to maintain this unneeded
space. Every dollar that goes to that is not going towards other higher
priorities.

[Holly Hobbs:] What about the cost to the communities these buildings
are in? Like, for example, here in D.C. where there's a lot of federal
office buildings?

[David Marroni:] Underused federal buildings mean you have fewer federal
workers in those buildings, which means there are less people to buy the
goods and services that surround those buildings. So if you walk around
D.C.'s core, you can see that every day. Some of the restaurants are
closed, some of the dry cleaners, other basic goods and services aren't
being sold now because the federal workers aren't there. Consolidating
into fewer buildings would benefit the local economies in these areas
because, again, you have more workers to buy things, but you also could
put some of these buildings if they're not needed anymore, to better
uses. We have some examples where federal buildings were turned into
hotels and they then contribute property taxes to the local economy. So
there's real costs to having underused buildings and there's real
benefits to getting rid of unneeded space.

{MUSIC}

[Holly Hobbs:] So David just told us that under-occupied federal office
spaces are a longstanding issue made worse by the pandemic. And that
these empty spaces can have significant costs to the government,
environment, and taxpayers. So, David, in addition to your testimony
today, we've got some ongoing work on this issue. What can you tell us
about that?

[David Marroni:] So we do have several ongoing studies looking at these
issues. One will follow up from the work we've done here. Now that we've
identified how much space is being used in these buildings, we're going
to take a look at what do you do about that? What can you do from here?
And we also have ongoing work looking at things from the personnel
standpoint. How efficient and effective are remote workers? And how does
telework affect agency operations and service delivery? So those will be
coming out in the months ahead. Stay tuned.

[Holly Hobbs:] And last question, what's the bottom line?

[David Marroni:] So the bottom line is that, underused federal buildings
are a longstanding and costly challenge that telework has made more
acute. Now is the time for the federal government to act and decide how
much space it really needs. 

[Holly Hobbs:] That was David Marroni talking about his testimony on
federal real property. Thanks for your time, David.

[David Marroni:] Thanks so much.

[Holly Hobbs:] And thank you for listening to the Watchdog Report. To
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