WASHINGTON, DC—On Monday the General ServicesAdministration announced it has identified 19 buildings across the country into which it willencourage federal agencies to consolidate. Theinitiative is a long-standing goal of GSA's, KurtStout, executive vice president of the ColliersGovernment Solutions' national practice group, tellsGlobeSt.com.

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"This reflects a line of think that has been growing at the GSAfor years," he says, "which is that GSA as a fundamental duty toreduce the real estate costs of the federal government and one keyway to do so is to consolidate into their owned space, which theyview as cheaper than leased space."

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Local landlords perhaps used to hearing such vows from GSA inthe past-with little changing on the ground-should not be sanguineabout this latest pronouncement though. Stout says in the past GSAhas been constrained by a tight budget and found it difficult toget such projects to get off the ground.

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As Stout wrote in a blog post earlier this year, "despite theagency's stated goal of reducing reliance on 'costly leasing' therehas been little funding available for upgrade of federal buildingsto accommodate additional tenancy."

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Instead, in the last few years in particular, it has beenfocusing on short-term renewals in leased space and getting thebest deals from the landlords.

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Now, though, with the latest budget, the agency has some wiggleroom to launch more ambitious cost saving projects, Stout says.

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The good news for commercial real estate landlords is that thelist isn't concentrated in one city or region, such as theNortheast or Washington, DC, although both have been targeted onthe list, JLL's Chris Roth tells GlobeSt.com.

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Clearly this is fortunate for Washington DC because up until nowmuch of GSA's consolidation push has been aimed at the Nation'sCapitol, he says.

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From a taxpayer's perspective, of course, the move is a good oneand Roth says the numbers offered by GSA on Monday pencil in. "Theyseem to be aiming for a four-year payback period, which isgood." Just as clearly, though, there will be losers as well,namely owners of office buildings that are located close to GSA'targeted list, Roth says. "Some landlords won't get renewals goingforward, that is obvious."

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