Government Agencies Seek to Sell Costly Buildings
January 15, 2016
While doing some research for an in-house assignment a few months ago, I learned that government agencies own or lease a ton of buildings. I also learned, and I am not sure I am very surprised, that many of these agencies have no clue how many they own, where some of them even are, and how much they are worth.
Apparently my suspicions aren’t that far off base. They were confirmed in an article I recently read on the Chicago Sun Times website titled “For sale: Illinois isn’t only state looking to unload ‘money pit’ buildings.”.
The article chronicles states trying to sell buildings that rack up escalating maintenance costs. The buildings, of course, are supported by taxpayer money.
The portion of the article that first caught my eye was South Carolina Gov. Nikki Haley, upon arriving in office in 2011, asked about state-owned real estate, and nobody could tell her what the state owned. She issued an executive order to determine that, and learned that South Carolina owned 7,800 buildings and 2,500 parcels of land — a number she deemed excessive.
The efforts of other states to sell property and land to get the cost of maintaining and operating them off the books are also mentioned. The idea of selling the properties, the article states, is to take advantage of hot real estate markets and commercial developers who want the buildings.
A couple other examples of state governments trying to unload significant properties include:
• Illinois wants to sell a 17-story office building in Chicago’s Loop that cost $172 million to build in the 1980s and faces $100 million in deferred maintenance fees.
• Georgia placed a 41-story office tower in downtown Georgia on the market that was given to the state in 1992 but faces nine-figure renovation costs.
This Quick Read was submitted by Dave Lubach, Associate Editor of Facility Maintenance Decisions, and Managing Editor of facilitiesnet.com. Reach him at email@example.com.
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