DHS looking at how to consolidate as leases expire

Two years ago, when the Department of Homeland Security was planning to consolidate its headquarters at the former St. Elizabeths hospital in Southeast D.C., the agency decided the time was right to also find new space for thousands of other workers.

Thus began a search for 1.13 million square feet of office space to house operations such as Citizenship and Immigration Services.

Then the world of federal real estate began to change. The economy had turned, and Congress and the General Services Administration, which was handling the search for DHS, began to push agencies to cut back on their space needs. DHS put its plans on hold.

Now, with leases facing expiration, DHS is considering how best to consolidate some of its operations under the new unwritten rules of federal real estate decisions.

“Some of our leases in the National Capital Region are expiring ,and we will be re-competing those expiring leases with a goal of reducing our leased square footage,” said Jeff Carter, a spokesman for the DHS, in an e-mail. “No solicitation in this process has yet been issued by GSA, but that agency will release information about those lease solicitations when appropriate.”

Carter cautioned that DHS had not begun to look for space and was not planning to move CIS to a new facility. A GSA spokeswoman confirmed that there was an ongoing search for DHS space, but declined to elaborate.

Word that DHS was again considering its real estate options has begun to trickle to developers and federal real estate analysts, even as the larger consolidation of DHS facilities at St. Elizabeths has largely been put on hold for budget reasons.

Art Turowski, senior vice president at the services firm Jones Lang LaSalle, said that because CIS does not strictly play a security role, it never was considered part of the agency’s larger consolidation. “They are the agency that is really fragmented at DHS, and they don’t really need to be at St. Elizabeths,” he said.

When DHS began its search — back when it hoped to find 1.13 million square feet — developers in D.C. and Northern Virginia submitted proposals.

Darian A. LeBlanc, senior managing director at Cassidy Turley, said one sure thing is that it will be less than the 1.13 million square feet it was when the search began. “My sense is that it will be back out probably later this year,” he said.

Jonathan O'Connell has covered land use and development in the Washington area for more than five years.
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