Lease Cost Avoidance

PBS is focused on achieving taxpayer savings by avoiding increased lease cost through the timely replacement of expiring leases. The Lease Cost Avoidance Plan (LCAP) is GSA's plan to achieve approximately $4 billion in cost avoidance on leases becoming effective through Fiscal Year 2023. The LCAP targets the 20% of GSA leases that accounts for roughly 80% of annual leasing costs. As the targeted leases are near expiration, we will seek to avoid costs by establishing longer firm term leases; negotiating favorable rates; reducing rentable square feet (RSF) and utilizing GSA’s Total Workplace Program; backfilling vacant federal or leased space; and accelerating lease cycle time.

Lease Cost Avoidance is calculated by comparing an agency’s new lease or occupancy cost over the lease term to its prior lease or occupancy. Actual taxpayer savings is realized each year over the life of the lease.

Success Stories

PBS continues to realize successful lease cost avoidance through reduction of the lease footprint, achieving better pricing through longer terms, and negotiating rates below market. See examples of significant cost avoidance for taxpayers below (PBS Money Minutes linked below).

GSA's Public Buildings Service will deliver $1.43B in Courthouse Program Projects on budget. - This program ensures project delivery within budget for 14 new or modernized courthouses, totaling up to 1.7 million gross square feet of space. Nine of 14 courthouses will be substantially completed in the next two years.

GSA's Mid-Atlantic Region Saves the Department of Labor $51.2M - Their long term lease was negotiated 52% below the market rate, reduced their footprint by 31% and was awarded with a 10-year firm term.

GSA's National Capital Region Saves the Department of Health and Human Services $24.7M - Their long term lease was negotiated 47% below the market rate, reduced their footprint by 28% and was awarded with a 10-year firm term.

GSA's Heartland Region Saves the Veterans Benefits Administration (VBA) $2.1M - The VBA relocated to underutilized federal space and reduced their footprint by 54%.

GSA's Northeast & Caribbean Region Saves the Department of Housing and Urban Development $6.3M - Their long term lease reduced their footprint by 43% and was awarded with a 10-year firm term.

GSA's Southeast Sunbelt Region Saves the Bureau of Alcohol, Tobacco, Firearms and Explosives $3M - Their long term lease reduced their footprint by 30% and was awarded with a 10-year firm term.

GSA's National Capital Region Saves the Department of Treasury $8.4M - Their long term lease reduced their footprint by 32% and was awarded with a 10-year firm term.

GSA's National Capital Region Saves the Office of Special Counsel $8.8M—Their long term lease was negotiated 29.63% below the market rate and was awarded with a 10-year firm term.

GSA's Northeast & Caribbean Region Saves the Department of Health and Human Services $12.6M - Their long term lease was negotiated 18% below the market rate and was awarded with a 10-year firm term.

GSA's National Capital Region Saves the Department of Commerce $9.8M - Their long term lease was negotiated 39% below the market rate, reduced their footprint by 16%, and was awarded with a 15-year firm term.

GSA's Mid-Atlantic Region Saves the US Attorney's Office in Philadelphia $33.2M - Their new long term lease upgraded their space, reduced their footprint by 4.1%, and saves taxpayers more than $33.2 million dollars.

The Environmental Protection Agency’s 20-year firm term lease in Dallas saves taxpayers $56.8 million in Lease Cost Avoidance - EPA’s long term lease was negotiated 36% below authorization rate, reduced their footprint by 4.3%, and saves taxpayers $56.8 million dollars.

GSA’s Purchase of the Department of Transportation’s Headquarters Saves Taxpayers $409 Million - The early purchase saved taxpayers an additional $99.8 million in avoided rent costs.

The Department of Agriculture’s Consolidated Lease Saves $1.5 Million Annually in Rent - The new lease consolidated two leases into federal space and reduced the agency's footprint by 52%.

The Environmental Protection Agency’s Replacing Lease in Denver Achieved $67 Million in Cost Avoidance - The replacing lease was awarded with a 15-year firm term, negotiated 14% below the authorization rate, and reduced the agency’s footprint by 29%.

Last Reviewed: 2021-06-07