Hundreds of federal offices could begin closing this summer at DOGE's
behest, internal records show
[March 14, 2025]
By RYAN J. FOLEY, JOSHUA GOODMAN and CHRISTOPHER L. KELLER
Federal agencies will begin to vacate hundreds of offices across the
country this summer under a frenetic and error-riddled push by Elon
Musk’s budget-cutting advisers to terminate leases that they say waste
money.
Musk's Department of Government Efficiency maintains a list of canceled
real estate leases on its website, but internal documents obtained by
The Associated Press contain a crucial detail: when those cancellations
are expected to take effect. The documents from inside the General
Services Administration, the U.S. government's real estate manager, list
dozens of federal office and building leases expected to end by June 30,
with hundreds more slated over the coming months.
The rapid pace of cancellations has raised alarms, with some agencies
and lawmakers appealing to DOGE to exempt specific buildings. Several
agencies are facing 20 or more lease cancellations in all, including the
IRS, the Social Security Administration, the U.S. Department of
Agriculture and the U.S. Geological Survey.
Many of the terminations would affect agencies that aren't as well-known
but oversee services critical to many Americans.
They span from a Boise, Idaho, office of the Bureau of Reclamation —
which oversees water supply and deals with disputes across the
often-parched American West — to a Joliet, Illinois, outpost of the
Railroad Retirement Board, which provides benefits for railroad workers
and their survivors.
The lease terminations do not mean all the locations will close. In some
cases, agencies may negotiate new leases to stay in place, downsize
their existing space or relocate elsewhere.
“Some agencies are saying: ‘I’m not leaving. We can’t leave,’" said Chad
Becker, a former GSA real estate official who now represents building
owners with government leases at Arco Real Estate Solutions. “I think
there’s going to be a period of pushback, a period of disbelief. And
then, if necessary, they may start working on the actual execution of a
move."
Errors add to confusion
DOGE says GSA has notified landlords in recent weeks that it plans to
terminate 793 leases, focusing mostly on those that can be ended within
months without penalty. The group estimates those moves will save
roughly $500 million over the terms of the leases, which in some cases
were slated to continue into the 2030s. The Bureau of Reclamation
cancellation in Boise, for instance, would take effect Aug. 31 and is
expected to save a total of $18.7 million through 2035.
But DOGE’s savings estimates — a fraction of Musk’s $1 trillion
cost-cutting goal — have not been verified and do not take into account
the costs of moves and closures. The group has released no information
about what they will mean for agencies.
“My initial reaction is this is just going to cause more chaos,” said
Jim Simpson, an accountant in Arizona who helps low-income people file
taxes and serves on an IRS panel that advocates for taxpayers. “There’s
a lot of room to help with government efficiency, but it should be done
surgically and not with a chainsaw.”
Simpson said he was surprised to learn that dozens of IRS offices,
including local taxpayer assistance centers, were facing upcoming lease
cancellations. He refers clients there to get paperwork to file returns
and answer IRS inquiries, and he said losing services would “cause a lot
of anxiety” and delay refunds.
Plans to cancel the leases at several of the IRS centers and other sites
were in error and have been rescinded, according to a person with direct
knowledge of the changes who spoke to the AP on the condition of
anonymity in order to avoid retaliation. Those changes are not yet
reflected on DOGE’s list, which only removed one and added dozens more
in its latest update published Thursday.
The GSA walked back the cancellation of a Geological Survey office in
Anchorage, Alaska, for instance, after learning it did not have
termination rights, according to the person familiar with the matter.
Rep. Tom Cole, R-Okla., said Monday that he’d convinced DOGE to back off
lease terminations planned for the National Weather Center in Norman, a
Social Security office in Lawton and the Indian Health Services office
in Oklahoma City. But all three leases remained on DOGE’s list of
cancellations as of Thursday.
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A chain link fence protects a satellite station and other equipment
behind the Bureau of Reclamation office Thursday, March 13, 2025, in
Boise, Idaho. (AP Photo/Rebecca Boone)
GSA's press office didn't respond to inquiries.
The real estate market is blindsided
While there was already a bipartisan push to reduce the government’s
real estate footprint, the mass cancellations blindsided an industry
known for its stability.
Landlords who had been expecting government agencies to remain
tenants, for several more years in some cases under their existing
leases, were stunned. Some agencies learned from building managers,
not their federal partners, that their leases were being canceled,
according to real estate managers.
Becker, whose firm is tracking the DOGE lease cancellations, and
other observers said they expect some agencies will be unable to
move their personnel and property out of their spaces within such
tight timelines. That may force some agencies to pay additional rent
during what’s known as a holdover period, undermining DOGE's stated
goal of saving taxpayer money.
The Building Owners and Managers Association, which represents the
commercial real estate industry, told landlords in a recent advocacy
alert to be prepared to seek payment from any federal government
tenants who stay beyond their leases.
Many affected agencies aren't speaking up
Asked about plans for buildings with leases that will soon expire,
the IRS did not respond. A Social Security Administration
spokesperson downplayed the impact of its offices losing leases,
saying many were “small remote hearing sites,” did not serve the
public, were already being consolidated elsewhere or planned for
closure.
Several other agencies provided little clarity — saying they were
working with GSA to consider their options, in statements that were
nearly identical in some cases.
But a spokesperson for the Railroad Retirement Board expressed
concern over the upcoming lease cancellations of its offices in
Joliet, Illinois, and eight other states, saying it was working to
"maintain a public-facing office presence for the local railroad
community.”
Government Accountability Office official David Marroni told a
congressional hearing last week that the push to unload unnecessary
federal real estate was “long overdue,” saying agencies have for too
long held on to unnecessary space. But he warned the downsizing must
be deliberate and carefully planned to “generate substantial savings
and mitigate the risk of mistakes and unexpected mission impacts.”
That process had already started before Musk’s team arrived, with
the federal government’s real estate portfolio steadily declining
over the last decade. Indeed, critics of DOGE say if it were truly
interested in cost-cutting it could learn from GSA, whose mission
even before Trump took office was to deliver “effective and
efficient” services to the American public.
A law signed by former President Joe Biden before he left office in
January directed agencies to measure the true occupancy rates of
leased spaces by this summer. Those that did not meet a target of
60% use rate over time would be directed to dispose of their excess
space.
”There is a logical and orderly way to do this,” Rep. Greg Stanton,
an Arizona Democrat, said at last week’s hearing. Instead, he said,
DOGE is pursuing a reckless approach that threatens to harm the
delivery of public services.
Industry observers cautioned that each situation is different, and
it will take months or years to understand the full impact of the
lease cancellations.
“It really depends on the terms. But it is a shock, there is no
question, that all of a sudden, boom, in six weeks all these things
have happened,” said J. Reid Cummings, a professor of finance and
real estate at the University of South Alabama. “It’s like a
blitzkrieg.”
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Foley reported from Iowa City, Iowa; Goodman reported from Miami;
and Keller reported from Albuquerque, New Mexico. Fatima Hussein in
Washington contributed to this report.
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