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Federal Office Leases in DOGE's Crosshairs

Elon Musk’s movements around Washington, D.C., last week are causing speculation about potential cuts to the federal government's workforce and real estate portfolio of owned buildings and leased space in private-sector buildings under the auspices of the Department of Government Efficiency.

Last week, Musk visited General Services Administration headquarters in Washington, causing speculation that real estate right-sizing activity could be imminent, according to an article in The New York Times. DOGE so far has focused on terminating leases on underutilized federal offices, which are managed by GSA. The agency recently announced it had already terminated three such leases for a savings of $1.6 million. The government leases more than 7,500 spaces that could be targeted by DOGE.

Stephen Ehikian, recently appointed acting GSA administrator, announced last week that two of the agency’s properties will be listed for sale in a ‘first step’ to cutting real-estate expenditures, according to the article. GSA also recently appointed Michael Peters as commissioner of the Public Buildings Service, which will play a role in managing cost-effective workspace solutions for federal agency customers.

“PBS will ensure the federal government’s real estate footprint is managed with the utmost discipline and strategic rigor,” Peters said upon his appointment.

Several of Musk’s former employees and associates have roles at GSA. Former Tesla engineer Thomas Shedd was named the GSA’s director of technology transformation services last month tasked with modernizing government systems. And Boring Company executive Steven Davis reportedly is assisting with Musk’s work at DOGE, including a focus on the GSA. Davis played a key role in cost-cutting efforts at X after Musk bought the social media company in 2022.

Musk’s time in Washington last week also reportedly included a visit to the Office of Personnel Management, which is led by tech executives who previously worked for him. Following that visit, the agency sent an email to federal employees outlining office work requirements and new performance standards. The email echoed one sent to Twitter employees after Musk’s 2022 takeover, including an identical subject line: “Fork in the Road,” according to The New York Times article.

“The only way to stay ahead of the upheaval is to put Air Tags in the pockets of former Tesla and SpaceX employees roaming D.C., but if you’re not already with them then you’re just in the way,” said one former GSA employee in a NextGov article about the reach of Musk’s associates.

Reprinted with permission from the Tuesday, 04 February 2025 06:24:20 EST online edition of GlobeSt © 2025 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or reprints@alm.com.