Over One-Third of All Federal Leases Available for Termination by End of Trump’s Term

As President Donald Trump and his administration make government efficiency a key part of his policy agenda, the sheer extent of office space that could be shed by the federal government is coming into focus.

The federal government is the biggest owner and operator of real estate in the United States, with about 360 million square feet of leased and owned space in its portfolio across 50 states and all U.S. territories. Nearly 150 million square feet of that total comes from leases, costing an annual $5.25 billion in rent. The General Services Administration, the government’s de facto property manager, has for years systematically reduced its office portfolio in the name of efficiency. But  recent reports indicate that Trump is considering going even further — potentially selling two-thirds of government offices and canceling three-fourths of its leases within Washington, D.C.

But it’s not just D.C. leases on the chopping block. Over 35 percent of all GSA leases, representing some 53 million square feet across 2,532 buildings and $1.87 billion in annual rent cost, are eligible for termination by the end of Trump’s term in 2028, according to a recent analysis by Trepp. More than 500 leases totaling over 8 million square feet are available for termination this year alone, accounting for about 5 percent of that annual rent number at roughly $260 million.

Much of that leased space is located, unsurprisingly, within the DMV. The government’s activity accounts for about 10 percent of the region’s total office inventory; 446 buildings totaling 35.8 million square feet fall under the GSA’s wing, costing an annual $1.47 billion in rent. About 27 percent of that space is available for termination by the end of this year, per Trepp.

The amount of leased space in other markets that could be cut by the end of 2025 is even more drastic. Over 38 percent of 113 buildings the GSA leases in the Chicago area are available for termination, while over 45 percent of the 90 leases used by the feds in and around Atlanta could be canceled this year. 

A spokesperson for the GSA did not immediately respond to a request for comment. Representatives for the White House could not immediately be reached. 

Washington, D.C., has long been considered “recession-proof” because of its interdependence with the government and the jobs it provides. But the District’s office woes — highlighted by dismal levels of vacancy and availability — could be compounded, and its relationship with the private sector totally altered in the years to come if the Trump administration ultimately moves forward with the vast amount of cuts available. But in the long run, that’s not necessarily a bad thing.

Yesim Sayin, executive director of the D.C. Policy Center, told Commercial Observer late last year that a severe shrinking of the government’s portfolio in the District could ultimately foster a more diverse economy as the private sector moves in to take space the feds leave behind. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.