Office of Real Property Asset Management GSA Portfolio Overview January 2009

GSA – Federal Agency Update U. S. General Services Administration The US General Services Administration leverages the buying power of the federal government to acquire best value for taxpayers and our federal customers. We exercise responsible asset management. We deliver superior workplaces, quality acquisition services and expert business solutions. We develop innovative and effective management policies.

GSA – Federal Agency Update U. S. General Services Administration Public Buildings Service (PBS) Federal Acquisition Service (FAS)

GSA – Federal Agency Update U. S. General Services Administration What’s going on TODAY? 1.Presidential Transition 2.Economic Stimulus Package

GSA – Federal Agency Update U. S. General Services Administration Public Buildings Service (PBS) One of the largest and most diversified public RE organizations in the world. In 2,100 communities 6,197 employees About 30 appraisers

GSA – Federal Agency Update 1,513 Owned Buildings; 176 million RSF 7,106 Leased Bldgs; 175 million RSF Over 1,000,000 workers in PBS space 420 historic buildings, including 63 National Historic Landmarks

GSA – Federal Agency Update PBS in your community Customers (major) Justice Judiciary Treasury Defense Homeland Security Social Security Interior Health and Human Services Education EPA……and many more Good Neighbor Program Arts in Architecture Design Excellence Day Care

world war II great society contemporary design excellence historic Construction Era Owned Inventory 46%

Historic 1810 – 1941 US Courthouse San Juan, Puerto Rico Alexander Hamilton Custom House New York, NY

World War II 1942 – 1949 Federal Center Kansas City, MO Federal Center Auburn, WA

Great Society 1950 – 1979 Federal Building and Courthouse Phoenix, AZ Federal Building Los Angeles, CA

Contemporary 1980 – 1993 Thomas O’ Neill Federal Building Boston, MA Alan Bible Federal Building Las Vegas, NV

Design Excellence 1994 – Present Lloyd George Courthouse Las Vegas, NV Federal Courthouse Islip, NY

Portfolio Trends Increase in square footage Decrease in number of buildings –New inventory and disposals –Lease consolidations/expansions Decrease in owned vacancy Maintained record low vacancy in leased

Space Trends

New Construction FY02FY03FY04FY05FY06FY07Total # of Assets Rsf (in millions) Cost (in millions) $483.6$163.9$496.9$110.9$860.9$1,983.6$4,099.7 Reported Excess FY02FY03FY04FY05FY06FY07Total # of Assets Rsf (in millions) Liability Avoided (in millions) $171.4$75.9$8.8$184.3$147.5$24.0$611.9 $ Proceeds (in millions) n/a $5.3$51.9$82.2$139.4 New Inventory Disposal

Vacancy Trends

Financial Trends Revenue increase driven by leases –Owned increased by almost 3% or $92M –Leased increase over 5% or $241M Growth in expenses outpaced revenue –Owned expenses increased by 4.4% –Leased expenses increased by 6.0% Leased FFO was negative for the second consecutive year

Financial Trends

Office of Real Property Asset Management Reinvestment Liabilities Realities Needs Funding Inflation September 2008

Reinvestment Realities Increasing construction costs Limited funding Large (expensive) national priorities Leasing for many long-term requirements

FY2007 Reinvestment Needs

Reinvestment Funding

Office of Real Property Asset Management The Path Forward Limited Call for 2010 Core Asset Review Leveraging Resources Section 412 Authority September 2008

2010 Limited Call FY New Construction and R&A Projects - $1.3B Total 32 Lease Prospectuses (including lease alterations) Focus on unresolved issues: i.e. Billings Courthouse FY New Construction and R&A Projects- $1.3B Total 67% of the projects submitted by the regions did not advance 56 Lease Proposals. Most are still under review Stimulus package impact? FY 2010 Expect 2010 Budget, at best, to resemble 2009 (Stimulus package impact?) 49 New Construction and R&A Projects identified for Directed Call

Core Assets Financial Performance Strategic Assets Investment Rating

Historic Portfolio Historic Portfolio vs. Total Core Assets Portfolio LegacyPortfolio Legacy Percentage Building Count % RSF 43,452, ,238,07525% PCS $ 2,020,335,518 $ 6,262,672,02432% IRIS $ 3,589,177,569 $ 7,724,416,31346% NOI $ 461,517,668 $ 2,082,079,06622% BA54, 55, 64 obs (FY05 - FY07) $ 1,645,758,459 $ 5,416,212,35930%

Historic Portfolio(cont.) Historic Portfolio – Core Asset Holding Periods >15 Long Term 6-15 Transition 0-5 Short TermGrand Total Building Count RSF 40,660,686 2,155, ,871 43,452,990 PCS $ 1,859,459,187 $ 92,287,085 $ 68,589,246 $ 2,020,335,518 IRIS $ 3,256,743,864 $ 172,143,341 $ 160,290,364 $ 3,589,177,569 NOI $ 454,953,383 $ 7,557,812 $ (993,527) $ 461,517,668 BA54, 55, 64 obs (FY05 - FY07) $ 1,575,221,895 $ 57,214,005 $ 13,322,559 $ 1,645,758,459

Capital Needs –New Construction $16.3 B. Courts $2.5 billion CBP $4.9 billion Executive Agency Priorities $4.8 billion Acquisition & New Construction$4.1 billion –R&A$8.1 B. R&A pipeline projects $5.1 billion Additional immediate repair needs $3.0 billion Limited scope projects & energy mandates$0.9 billion TOTAL NEEDS$25.3 B

Sources of Capital Traditional Sources Rent Direct Appropriations Existing Authorities Historic Outleasing ESPC 412 Disposal (exchanges, outlease) New Authorities Leasing (credit tenant leasing) purchase options Stimulus Package???

GSA – Federal Agency Update` Real Property Asset Management $2 to 3 Million $2 to 3 Million annually for individual contracts for appraisal services 3 Appraisal Programs: Fair Market Value (FMV) and Acquisition Fair Annual Rent (FAR) Property Disposition, Utilization

GSA – Federal Agency Update Dwight D. Eisenhower Executive Office Building Old Post Office U.S. Department of Justice Visit and

GSA – Federal Agency Update Oklahoma City Federal Building SSA Call Center; adaptive reuse, Auburn, WA Center for Drug Evaluation and Research, FDA, White Oak, MD Kansas City IRS; Lease construction

GSA – Federal Agency Update GSA National Appraisal Program Contacts: Acting Chief Appraiser and Disposal Appraisal Program Nicholas S. Hufford, MAI, CAE Market Value Appraisal Program: John N. Libeg, MAI, SRA Fair Annual Rent Program Jay Koepf Also see Regional Contacts list

GSA – Federal Agency Update Web Resources: USA websitehttp:// GSA websitehttp:// Central contractor registrationhttp:// Federal contracting opportunities Get DUNS numberhttp:// GSA Online RE auctionhttp://auctionrp.com/auctions2/ More government saleshttp://

GSA – Federal Agency Update

THANK YOU! Nicholas S. Hufford, MAI, CAE Acting Valuations Director and National Appraiser for Property Disposition General Services Administration Public Buildings Service Office of Real Property Asset Management Valuations Division 1800 F Street NW, Suite 7300 Washington DC cell fax