For more than 50 years, the General Services Administration has been the government`s leading provider of real estate services. We provide work space for over a million civilian employees in 100 federal agencies. Our involvement with historic properties is quite a big subject with many dimensions.
I`d like to give you a feel for what`s in our portfolio and some of the challenges we face, and a sense of our philosophy and serious commitment to preserving the historic and architectural treasures entrusted to us.
Nearly one half of the 1,700 buildings GSA owns are historic or at least of historic age. GSA`s 435 buildings listed in, or appearing to meet, National Register eligibility criteria provide about 55 million square feet of workspace. They include courthouses, customs houses, office buildings, laboratories, and border stations in all 50 states and several territories.
Public buildings constructed between the 1830s and 1930s set a high standard for design excellence and durability. Monumental entrances and elegant public spaces built in that era extend a gracious welcome to citizens visiting the offices of the federal government. During the 1930s, an expanded federal construction program introduced a new design esthetic but continued to maintain high standards for proportions, materials, and detailing in significant public buildings.
Preservation of these buildings is an integral part of our business.
We have five primary approaches to using historic buildings:
1. We reinvest in them so they can serve the modern federal workforce;
2. We reprogram them for new uses when necessary;
3. We lease out our historic properties to private tenants when there is no federal need;
4. We lease historic buildings (from non-federal building owners) and occasionally;
5. We acquire historic properties to meet federal needs.
First: By reinvesting in federally owned historic office buildings, we ensure that they can continue to serve a 21stcentury workforce. Our chief investments are in safety, building systems improvements, and exterior maintenance.
Second: As federal space needs change, we keep buildings viable by reprogramming them to serve new functions.
For highly ornamented buildings like the Alexander Hamilton Customs House in New York City -- which is one of my personal favorites -- we look for tenants, such as the Bankruptcy Courts, that need formal spaces. We also look for uses that enable the public to enjoy our most outstanding spaces. The Customs House also houses the Smithsonian`s Museum of the American Indian.
By using the special authority provided by Section 111 of the National Historic Preservation Act, we can also lease out space in underutilized historic federal buildings to non-federal tenants. Section 111 allows federal agencies to retain this rental revenue and reinvest it in historic buildings, so everybody gains. For example, we lease the Galveston, Tex., Customs House -- the oldest federal building west of the Mississippi and a National Historic Landmark -- to Galveston Historical Foundation for use as a public research center.
When space is not available in government-owned buildings, we consider historic buildings first when searching for spaces to lease. Historic industrial buildings such as the 1890s Stegmaier Brewery in Wilkes-Barre, Pa., provide daylight- filled, open-space work areas for a cross-section of consolidated federal agencies.
And finally, through our Good Neighbor and Design Excellence programs, GSA works with communities to make the most of historic properties it acquires. The Erie, Pa., federal courthouse expansion will reuse a 1930s Art Deco federal courthouse, a turn-of-the-century Beaux Arts municipal library, and a former Art Moderne clothing store -- all linked by a sympathetic glass addition serving as the entrance portal to the new complex. We think it will be one of a kind.
Occasionally we acquire historic buildings from cities, states, or other federal agencies. For example, the 1920s La Vista del Arroyo luxury hotel in Pasadena, Calif., once an army hospital, now provides gracious housing for the U.S. Courts.
It is a testament to the durability of the federal public building legacy that many of our historic buildings continue to serve the functions for which they were constructed. But much has changed in the way we manage these buildings.
GSA`s oversight of its owned and leased properties is a large and complex business.
During the 1990s the drive to balance the budget led to the government-wide focus on government that works better and costs less. The federal workforce and budget have been reduced. We are learning to do more with less money, to spend tax dollars wisely while maintaining high stewardship standards and high workspace standards for our federal client agencies.
The Public Buildings Service has adopted the real estate business practice of managing federal property as a portfolio of assets. Expenses must relate to income. Capital funding for repairs and improvements is based not only on need but also on the financial return expected for the government`s investment.
Federal agencies that lease space in either government-owned and privately owned properties pay rent to the Federal Buildings Fund. The fund pays for the cost of building operations, maintenance, repairs, and alterations, and for leasing other space where government space is not available.
To put it bluntly, the Fund -- our internal bank -- is not equal to the task.
To grow the bottom-line and keep our historic buildings financially viable we must 1) increase our rental income and 2) look for ways to control expenses.
We can increase our rental income by:
- Reducing vacant space;
- Charging appropriately higher rents for superior space; and
- Leasing underutilized space to private entities, under Section 111 of the National Historic Preservation Act.
We can control expenses by:
- Setting priorities for repair and alteration with an emphasis on essential rehabilitation needs;
- Using repair and alteration methods that require less intervention;
- Making cost-effective changes to reduce energy consumption; and
- Focusing major restoration efforts on high visibility public spaces.
Unfortunately many government-owned public buildings, including our historic buildings, operate at a substantial loss, and there is only so much we can do within the constraints of our market based pricing standards. Government Accounting Office studies on deferred maintenance of government-owned assets make it clear that the inventory cannot be maintained through current federal appropriation levels.
The good news is that proposed legislation on Capitol Hill -- introduced in the House in October -- will increase the ways we can leverage the equity of federal assets with private-sector investment. A bill to amend the Federal Property and Administrative Services Act of 1949 will help us to maintain the federal inventory by providing:
- increased authority to lease out space in all public buildings to the private sector;
- increased authority to engage in public-private partnerships to rehabilitate and redevelop federal property; and
- new authority to retain the proceeds from federal property disposals.
If this Property Reform legislation is enacted -- and we are very optimistic that it will be -- it will revolutionize the way we do business.
As our strategy for managing the federal portfolio evolves, we remain committed to the stewardship of our historic public buildings. Our capital investment program will continue to give additional weight to reinvesting in federal historic buildings-especially national landmarks such as the Court of Appeals in San Francisco; public buildings that are focal points in their communities such as the Pioneer Courthouse in Portland, Ore.; and buildings that maintain a federal presence in the center city such as our courthouse in San Juan, Puerto Rico, the oldest permanent federal building in old San Juan.
We`ll also actively seek to mend tears in the fabric of our cities while building tomorrow`s landmarks. In Scranton, Pa., we were able to persuade the city to let us demolish an apartment house that was tax revenue producing but architecturally incompatible with its neighbors, to construct a Courthouse Annex that would allow the federal courts to remain in the adjacent historic courthouse on the town square. The new annex has restored the design unity and enhanced the pedestrian scale of this important urban location. This is a gorgeous project, combining old and new with great impact.
We`re also taking a closer look at our buildings from the more recent past which are now beginning to show their age. We have held a number of panel discussions bringing together nationally distinguished architects to explore how to assess these buildings and involve community groups in our plans for change. Our goal is to develop criteria to evaluate their value and to guide us with investment and real estate decisions for this part of the inventory.
As our needs change, we will make an extra effort to keep highly significant buildings economically viable so that they can be maintained in the federal inventory. The 1840s General Post Office in Washington, D.C., will reopen in May 2002 as a boutique hotel under a 60-year lease to the Kimpton Hotel Group.
We will also work to promote the redevelopment of older urban neighborhoods by leasing space in buildings like Tacoma`s Union Station. Catalyzing economic rebirth in urban areas is an important mission of government. This building`s original rotunda houses a glass museum which is open to the public. Courtrooms and other secure functions are housed in a rear addition.
Security has always been a priority for the Public Buildings Service. The tragic events in Oklahoma City moved security in federal buildings to the top of the list forever. Our comprehensive response to the threat of terrorism includes new standards for design and construction, new security systems and protocols, and greater attention to the challenges of instituting security measures while still retaining the esthetics of federal workplaces.
The essential challenge is to be safe without compromising design quality and creating an oppressive climate of fear for people entering and using these buildings. We remain committed to keeping our public buildings open to the public. We continue to refine our standards for stricter security at federal buildings to ensure the safety of federal workers and visitors.
Improved security along our vulnerable building perimeter areas doesn`t have to mean buildings surrounded by unsightly vehicle bollards and lobbies cluttered with security processing equipment. For example, at the Federal Triangle in Washington, D.C., we have a new master plan that attractively integrates security features such as vehicle barriers into the redesigned landscaping.
Our First Impressions program streamlines the design of security devices and other equipment to keep our lobbies attractive. Our new Facilities Design Standards encourage keeping our most elaborate and gracious entrance lobbies accessible to the public by placing security processing functions in ancillary spaces adjoining entrance lobbies. This approach also allows us to better control circulation at our entrances.
As GSA faces more complex security challenges, we will still continue to create opportunities for members of the public to enjoy their public buildings. For example, the Great Hall of the Pension Building, which now houses the National Building Museum, provides an unforgettable setting for public ceremonies and events.
A Call for Guidance
And now, this is where you come in. As we strive to be worthy stewards of our historic inventory and continue the federal legacy of building public landmarks, GSA will be turning to you for help. We will look to you to encourage our client agencies to locate in historic buildings and reinvest in historic urban areas, and to help us identify historic buildings that can accommodate the space requirements of our federal clients.
We`ll look to you to share your expertise and experience to help us solve difficult program and design challenges, and to help us find reliable stewards for historic buildings that are no longer needed by the federal government.
We`ll look to you to help us use every available authority to put historic buildings to use while investing taxpayer funds prudently and living within our means. And we`ll look to you to have faith in us and trust in our commitment to stewardship.
We invite you to collaborate with us in preserving the federal legacy of the past as we build the federal legacy of the future.
Publication Date: Winter 2002
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