WASHINGTON, DC—Tucked away in President Obama's $3.9 trillion budget proposal is an item of interest to the commercial real estate industry: the restoration of the General Services Administration's authority to fully use incoming rent funds to reinvest in its real estate portfolio. This could lead to more than $1 billion in maintenance for federal buildings, many of which have been needing renovations and even basic repairs.
Other elements of the budget also give a nod to real estate. It identified $745 million in nine construction projects across the country, ranging from land ports of entry to office buildings and courthouses.
It also requested $100 million to further efforts to consolidate agencies within existing federally owned space.
In truth it is difficult to get excited about even these modest proposals because the budget is still exactly that-a proposal. But the suggestion to restore the GSA's so-called zero net budget looks promising and could deliver real dividends to the portfolio, JLL's Chris Roth tells GlobeSt.com. "It is a better business model for the GSA and it is based on how private sector portfolios operate."
Other items of note in the budget:
- A request for $100 million for projects that will improve safety systems, meet security requirements, cut energy costs, and reduce water consumption.
- A request for $420 million in provisions for three border crossing and inspection projects.
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