The General Services Administration signed an agreement last week to purchase an 18-story office building in Rockville for $47.5 million and to lease another for $128.7 million, as part of a plan to consolidate the Nuclear Regulatory Commission in one suburban location.
William F. Sullivan, commissioner of public buildings for GSA, said the purchase is the first step in the administration's effort to move and consolidate federal agencies into high-quality suburban space, as part of a plan to get the government out of expensive leased space in downtown Washington.
"The purchase of One White Flint demonstrates GSA's commitment to federal employes to provide safe, high-quality office space in less expensive suburban locations," Sullivan said. "This is the first big chunk, and we are working on plans to purchase or lease other large blocks of space in the suburbs for similar consolidations."
The purchase agreement is with White Flint North Limited Partnership, a group that includes Albert and Gary Abramson, and Theodore N. Lerner -- one of the developers of Tysons Corner Shopping Mall -- and his son, Mark Lerner. Settlement is scheduled for October.
The second building has not been built, but the lease agreement stipulates that it also will be an 18-story building, rented for $22.50 a square foot per year for 20 years. Each building will provide 286,000 square feet of office space and a small amount of retail space.
The NRC's 2,600 employes currently are in 10 buildings in Maryland and the District, with the majority in Maryland. NRC Chairman Nunzio J. Palladino said the consolidation would help the agency operate more efficiently and would save the government money.
GSA said NRC headquarters has been housed in downtown space costing the agency $24 a square foot per year. The other NRC offices are in cheaper space, offices costing from $16 to $12.50 a square foot per year, GSA said.
The building on the site, which is adjacent to the White Flint Metrorail stop, has stood empty since it was finished in February. The second building is expected to be completed in three years.
GSA has the authority to purchase the existing building as part of the four-year-old "Opportunity Purchases" program, a program designed to allow GSA to purchase buildings in glutted office markets at fire-sale rates. So far, GSA has spent $48 million on three purchases, out of $156 million authorized for the program. GSA will need congressional approval to lease the second building.
The existing White Flint building will be the second recent GSA purchase in the Washington area. In 1984, GSA bought the 95,000-square-foot Judiciary Square building at 633 Third St. NW for $12.6 million. GSA has purchased a building in Austin, Tex., and one in Dallas as part of the "Opportunity Purchases" program.
GSA Administrator Terence C. Golden announced his plans to move federal offices into suburban "campus-like settings" last fall, angering District officials who said that the city "would lose a great deal" under such a the plan.
Despite those plans, GSA recently has signed long-term leases for space in several prime downtown office buildings at rental rates that are close to the top of the market, including a lease for the entire Bond Building, a historic rehabilitation project at 1400 New York Ave.