The long-running saga of 1300 New York Ave. NW, a giant, empty office building downtown, took another twist this week as the General Services Administration, with only hours of preparation, submitted a last-minute bid to buy it from a unit of the Bank of Nova Scotia.
Over the past several months, the bank has been negotiating with the Inter-American Development Bank to lease the building with an option to buy it for an undisclosed sum. In addition, reliable sources said that the IADB offered a "multimillion-dollar, non-refundable good-faith bonus."
The deal was to have been signed by Wednesday, but the deadline was put off a week, a Bank of Nova Scotia spokesman said, to give the parties time to iron out details.
GSA has been making noises about buying or leasing the building for more than a year, ever since it became clear that its Canadian developer, Daon, was having trouble leasing it.
Daon has since lost the building to the bank, which held a $132 million construction loan, and the bank has been scouting about for a tenant or buyer. But the government has continued to back and fill between some officials' desire for a very nice building and others' objections to the cost.
Various federal sources speculated this week that the new GSA offer was for $129 million. Senior GSA officials refused to confirm the figure, but one knowledgeable official said GSA's offer was actually comparable to the IADB price, because GSA was offering cash up front and the IADB deal probably offered some type of financing scheme.
At a sometimes tense meeting earlier this week, assistant attorney general Carol Dinkins and acting GSA administrator Ray Kline tried to convince Joseph R. Wright, deputy director of the Office of Management and Budget, to lend support for the purchase, according to sources close to the action.
The Justice Department would be the likely tenant for the 750,000-square-foot building.
After Wright refused to sign off on the project, citing the enormous budgetary implications, Dinkins reportedly told Wright that Attorney General William French Smith would put the issue on President Reagan's desk that very day.
"We couldn't go along with that for two reasons: It's an extremely expensive building and that, from a budgetary standpoint, is not the direction we should be moving," said Wright. "In addition, it's a little too fancy for a normal government building."
The facility features an atrium and waterfall in the lobby.
Wright said that GSA should be looking to use funds designated for an "opportunity purchase" program to snare new, low-priced facilities across the country, and not try to unload the entire two years' appropriation on one project -- this one.
The White House, for its part, regards the issue as something that should be handled "in channels," and staff members said no memo would reach the president. If Smith wants to take it up with Reagan he would have to call himself, they said.
OMB officials also said that the government's offer is likely to be seen as "several million under what they the IADB were offering."
Meanwhile officials at the Bank of Nova Scotia professed little interest in GSA's overtures.
"For quite a while, GSA has contacted us periodically to say they are still interested," a spokesman said. But, he added, "GSA saying they're still interested doesn't mean anything," and that the bank would not be willing to wait for a long, drawn-out government purchase proceeding.
The General Accounting Office has refused to consider a bid protest against GSA filed by Hampshire National Inc. over the sale of the old Ford Motor Co. plant in Alexandria to Cook Inlet Region Inc. of Anchorage.
Hampshire National alleged that the $14.2 million sale was made before GSA could properly complete archaeological surveys, as prescribed by federal law.
The GAO, however, said not enough information was submitted to investigate. GSA's Federal Property Resources Service contends that the "invitation for bids" clearly stated that the surveys would have to be done before the property could be developed, circumventing the need to have GSA complete the surveys beforehand.
GSA is now waiting for routine clearance from the Justice Department -- as is required for all sales of over $1 million -- before transferring the property.
In November, GSA earned nearly $4.3 million from the sale of 16 properties in southern Florida that had been confiscated by the Justice Department from racketeers and drug traffickers.
Another, an 80-acre horse farm, is likely to be sold for $765,000, bringing the take to $5.09 million.
In fiscal 1984, GSA sold another five confiscated properties for $202,000 of pure profit.
George Gross Jr., who used to head GSA's fledgling program to rent out unneeded government space, has become a special assistant to Charles S. (Terry) Davis, an associate GSA administrator for regional operations.
Gross was forced out of Public Buildings Service by Commissioner Lester L. Mitchell last summer and spent the last several months working in the private sector.
In his new position, he's to concentrate on "expediting out-leasing and disposal projects, focusing on high priority opportunities," Davis said.
Gross came to the federal government with 20 years experience as chief executive officer with his own firm, Turks Head Corp., of Rhode Island.