Management of Vacant Properties – 13YG017SM000
- Directorate:
- Supply Management & Facilities
- Program Area:
- Supply Management & Facilities
- Responsible Postal Official:
- VP, Facilities
- Start Date:
- 01-28-2013
- Estimated Report Date:
AUDIT OVERVIEW
The U.S. Postal Service is one of the largest real estate owners in the United States. In addition to owning and leasing land, the Postal Service has approximately 33,000 facilities nationwide with over 280 million square feet of space. The Postal Service’s Facilities Real Estate and Assets Group manages the Postal Service’s real estate portfolio by developing and implementing strategies that align with organizational goals and objectives related to the disposition, acquisition and leasing of property.
Opportunities may exist for the Postal Service to optimize excess facility and land space (either owned or leased) that is vacant. The OIG has identified instances where the Postal Service continues to rent vacant leased properties because the leases do not contain early termination clauses. Such clauses would allow the Postal Service to terminate leases early without penalty.
The OIG has also identified unused vacant land parcels the Postal Service has “land banked.” Land banking is the acquisition of land in anticipation of long-term future needs or expansion of services rather than for a specific project. The purpose of land banking is to gain control of land in high cost or land scarce areas when it becomes available.
We want to hear from you!
Do you know of any vacant Postal Service properties (facilities or land) in your area?
Is it better for the Postal Service to sell these properties now to generate revenue or hold onto the properties because the value may increase?
What else do you think the Postal Service can do with its vacant properties?
Please share your thoughts.
Thanks for your comment, Postal and Proud. The majority of properties that the Postal Service uses are leased. The main reason that this is done is to increase flexibility when needs change. Often property owners will not negotiate a lease without an early termination clause. The owners do this to assure themselves that they will continue to receive rental income for a set period of time. All Postal Service leases have renewal clauses at the end of each term,typically five years. When the term expires and the property is no longer needed, the Postal Service does not renew the lease. Hope this helps.
At the top of this blog you say: “The OIG has identified instances where the Postal Service continues to rent vacant leased properties because the leases do not contain early termination clauses. Such clauses would allow the Postal Service to terminate leases early without penalty.”
Why would the Postal Service sign a lease that cannot be terminated early? If I wanted to lease a building I would NEVER sign a lease that I couldn’t get out of.
Can you give me an example of one of the vacant properties? I’d like to see one for myself. (I live in Northern Virginia.) Thanks.