USDA says it will begin transferring vacant South Building to GSA, citing $1.6 billion in repairs
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Summary
USDA announced it has started the process of turning the South Building back to the General Services Administration for disposition, citing heavy vacancy and roughly $1.0–1.6 billion in deferred or delinquent maintenance; GSA said it will consult stakeholders and explore reuse for Southwest D.C.
The U.S. Department of Agriculture announced on Thursday that it is beginning the process of returning the South Building to the General Services Administration for disposition, citing extensive vacancy and large deferred maintenance costs. "Today, we are officially starting the process of turning the South Building back over to the General Services Administration," the department said.
The announcement, delivered at a USDA press conference, framed the move as part of a broader reorganization intended to "right size" USDA's federal footprint and reduce taxpayer exposure to underused and deteriorating property. USDA officials said the building is currently largely empty and imposes high annual operating costs and a backlog of repairs. Officials cited figures in the transcript ranging from "well over $1,000,000,000" to "$1,600,000,000" for deferred or delinquent maintenance on the South Building and described daily operating costs as "tens of millions" of dollars.
GSA Administrator, speaking for the General Services Administration, said GSA will begin a process of stakeholder consultation and market engagement to determine the best reuse and to address the building’s maintenance liabilities. "This disposition removes $1,600,000,000 in delinquent maintenance," the administrator said, and called the disposal an opportunity to support economic revitalization in Southwest Washington, D.C.
USDA officials said the measure is not an immediate sale; GSA will consult with local stakeholders and potential buyers and consider reuse options. Deputy Secretary Steven Baden said USDA has planned moves mission-area by mission-area and expects to empty the South Building by the end of the year, though he emphasized legal, union and regulatory steps will be followed and notices given to employees.
Officials repeatedly cited the statutory occupancy benchmark Congress set in the "use it act," which the transcript describes as a 60% minimum occupancy threshold for federally owned or leased space. USDA and GSA officials said many National Capital Region buildings fail that 60% standard and argued disposition is required to reduce fiscal risk.
The department framed the transfer as part of a four-pillar reorganization: align workforce size with resources, bring USDA closer to customers, eliminate management layers, and consolidate redundant support functions. Officials stressed the process will be carried out with urgency but also with consultation and follow required legal and regulatory steps.
Next steps: GSA will lead a formal disposition process that includes stakeholder outreach and market assessment; USDA will make mission-area relocation announcements in the coming weeks and said it aims to have affected employees in new hub locations in time for the next school year for families with school-aged children.
(Reporting from the press conference; no formal sale contract or final buyer was announced.)
