A vibrant and colorful arcade-style shopping mall in the wide concourse beneath the Pentagon?
Retail and fast-food shops at The Old Post Office at the staid National Aeronautics and Space Administration's headquarters--officially known as Federal Office Building 10-B--on Independence Avenue, across the street from the popular National Air and Space Museum?
The General Services Administration, which used to have a reputation as one of the U.S. government's least innovative agencies, has decided to move on both of these projects as part of a 7-year-old program that Congress designed to encourage cooperative public and private uses for federal buildings.
This morning, GSA began advertising for developers interested in the 110,000-square-foot Pentagon project, even though the space still is under the control of the Defense Department. The NASA headquarters building proposal is not quite that far along, but it ranks at the top of a list of 31 locations in the Washington metropolitan area that the government is interested in for cooperative-use space.
Just what is the U.S. government doing in the shopping arcade business?
While "mall management" is not going to be a new GSA job description just yet, the Cooperative Use Act of 1976 charged the agency with finding ways to encourage cultural, educational and recreational uses in and around federal office buildings.
Options, the law says, range from allowing a local high school drama department to use a government auditorium for a $1 fee to put on a play, to leasing space in an office building to a Defense Department consultant.
"This law was a breakthrough for the federal government," said GSA's regional director of business affairs, Dale L. Bruce, who watched the "space inside reach out to the neighborhood." For while the 1970s brought little government interest in retail and commercial uses, Bruce said, there was "considerable activity . . . for such things as art exhibits or groups wanting meeting or conference facilities."
In October 1977, Jay Solomon, GSA's administrator then, said he wanted to begin changing that tradition.
"They are called public buildings and there are about 10,000 of them nationwide, but how much use is made of them by the citizens and taxpayers who own them?" Solomon asked. "Frankly, not much. Except those working for or having business with the government agencies . . . the buildings die." Solomon moved to develop the much ballyhooed "living buildings" program, emphasizing the cultural, educational and recreational access, usually free of charge. In one statement, Solomon said that both courtrooms and courtyards should be utilized for the benefit of a community. Only political activities were banned.
But under the Reagan administration, the thrust of cooperative use has been bent toward a profit motive. In the past, leased office space that the government didn't need and couldn't turn back to a building owner used to sit vacant.
Now, GSA has a staff responsible for collecting competitive bids from prospective commercial tenants in a program to mitigate the drain on Treasury funds by leasing unused space.
Today, GSA's tenants include such diverse entities as Harry Wall's Barber Shop at 814 15th St. NW; Columbia Business Furniture at 1717 H St. NW; and the NAACP Legal Defense Fund at 806 15th St. NW. The space ranges from $7.30 per square foot at the Washington Navy Yard and $7.08 per square foot at 1900 Half St. SW, to $42 per square foot for a 1,000-square-foot suite that is now a botique at 1925 L St. NW.
In government-owned space, most of the effort has been directed toward the multimillion-dollar renovation and refurbishing of the stately Old Post Office at 12th Street and Pennsylvania Avenue.
Pressured to do something with the 1890s-vintage building by Nancy Hanks, then-chairwoman of the National Endowment for the Arts, GSA developed an innovative 55-year contract for the commercial development of the facility with the Evans Development Co. of Baltimore. For just $3.55 a square foot and 10 percent of the profits above a specific base rate, Evans got a gold mine.
"It has exceeded our wildest dreams, but we're not trying to be overconfident," said Evans chief Charles C. G. Evans. "This is an example of how the cooperative use act should work, allowing tenants to come in and pay a rate that they can afford, to present the proper mix of shops and food services to our visitors."
Evans believes the labyrinth of fast-food bars and sit-down restaurants blended with specialty shops in the Old Post Office is a tail wagging a dog and spurring business along the 12th and Pennsylvania corridors.
"We even had a delegation from Communist China over recently to specifically look at how we developed the Old Post Office Pavilion. They couldn't do it there, though, without free enterprise. That's what makes this work."
"I'm happy about these initiatives," said Bob Peck, an aide to Sen. Daniel P. Moynihan (D-N.Y.), the prime mover of the Cooperative Use Act along with Sen. Robert T. Stafford (R-Vt.).
With the success of the Old Post Office behind him, one might think GSA Public Buildings Commissioner Richard O. Haase would be looking to another grand historic monolith to renovate. Instead, he has his eyes on the Grand Concourse of the Pentagon, an expanse of open, and empty, aisles, just outside the cramped quarters in which Woodward & Lothrop has to operate.
Haase would like to expand on the 40,441 square feet of space now used by 18 stores--including several banks and the last remaining Walgreen's Drug Store in the area--creating a 110,000-square-foot mall with lively colors, a vibrant atmosphere and dozens of fast-food emporiums for the 27,000 employes who work at the Pentagon and the thousands of others who pass nearby each day as they transfer from subways to buses at one of the Metro system's major commuter exchanges.
Shortly after GSA was established as the government's building manager in 1949, the agency yielded authority to manage the fledgling Pentagon shopping area to the Defense Department. The delegation of authority meant that DOD would collect rent of $1.63 per square foot plus about one-half percent of the retail profits.
Today, however, under terms of the Federal Buildings Fund, GSA collects $9.96 per square foot for most of the space storeroom space is billed at $7.04 per square foot from DOD, which gets the money from Congress.
The rental income that DOD earns, however, goes to the DOD Concessions Committee, a social club, for recreational-related activities, and not to the Treasury. Thus, the taxpayers, through the Defense Department's annual appropriations, foot the bill for the space.
Haase, however, believes he has the authority to stop that by revoking the now long-lost delegation of authority under provisions of another law, and running the mall himself.
"We wouldn't want it as it is, though," he said, explaining that while the same tenants could stay, the area would have to be renovated and expanded. A bidders' conference is scheduled Nov. 9 with Haase in Room 315 of the Old Post Office.
A Defense Department spokesman said Friday that the Pentagon had "no knowledge" of any interest by GSA to recover control of the concourse.
Some GSA officials believe Haase's attempt to turn the underutilized Pentagon concourse into a thriving shopping mall with eateries intermingled with more botiques and specialty shops may end up as a head-to-head battle with Defense Secretary Casper W. Weinberger. Said one: "All he Weinberger has to do is assign a team of 25 people to fight this with a flick of the finger."
One reason Haase is moving on the Pentagon project is a March 1983, report by the GSA Inspector General that questioned the nebulous authority that Defense had over the control of the shops.
"A legal ruling is needed to determine if GSA can delegate control over commercial operations in one of its buildings," Benjamin H. Friedman, GSA's assistant inspector general for auditing, said in his report. So far, all Haase has is a fact sheet from GSA leasing division official Jack Burrows that recommends that GSA "assume control of retail operations in the Pentagon."
"The issuance of concessions contracts to private entities in space assigned to DOD indicates that the space under contract is not necessary to fulfillment of the Defense Department's mission and is excess to their needs," Burrows concluded. "This would not only improve . . . administration . . . but also ensure that proceeds from the use of federal buildings are deposited in the federal treasury."
Other parts of the IG report criticize GSA for failing to have an adequate program in place to meet the provisions of the law.
At the Pentagon, Haase--a former Washington appraiser--said his long-time friend, Woodies' Chairman Edwin K. Hoffman, is interested in the Pentagon project and is enthusiastic about expanding his 40-year-old store there as a cornerstone of the effort. Woodies, Walgreen's and Virginia National Bank are believed to be the only original tenants dating to 1949. Hoffman was not available for comment, and Haase emphasized that if the project were to move ahead, Woodies would be accorded no special favors.
"He's a businessman and he knows what's a good deal and what isn't," Haase said. "Anyone interested in the project will make their evaluation along those lines."
If the Pentagon project moves forward, GSA officials under the control of Kenneth L. Perrin, regional GSA subleasing chief, will move ahead on some of the other buildings in the Washington area.
The NASA headquarters building, Haase said, may be the first target, since it is across the street from Washington's biggest tourist draw, the National Air and Space Museum.
That choice location, in an area short on restaurants and shops for the 12 million visitors to the museum,, is what Perrin calls "an excellent in-town location for the next Pavilion-type project."
Across the street, Air and Space Museum director Walter J. Boyne is planning fast-food and sit-down restaurants under a permanent bubble-top canopy on the building's now-unused east front.
Currently, Smithsonian Institution officials are planning to solicit proposals from the private sector for what is planned as a facility to serve 1,000 fast-food customers and another 250 diners in a classy restaurant, Boyne said.
"I am very enthusiastic about the possibility" of GSA developing the NASA office building, Boyne said. "We will consider keeping the museum open longer hours for what will become the best deal in town--breakfast, lunch or dinner here or even across the street, plus our theater show, plus the museum."
Smithsonian chief S. Dillon Ripley has also outlined plans to Congress for the renovation of the Old General Post Office Building (sometimes called the Tariff Building) that include a restaurant.
Around the city, other government-influenced projects are in the offing, including the massive 12-story, one-million-square-foot Federal Triangle Building on 14th Street, between Constitution and Pennsylvania Avenues.
In addition, Haase has suggested that more than a dozen buildings could be constructed on GSA's portion of the Old Navy Yard as a new Southeast Federal Center complex featuring facilities that have virtually all of their ground floor space devoted to cooperative use activities.