RD497 - Department of General Services Combined Real Estate Report – November 15, 2017
*This report was replaced in its entirety by the Department of General Services on November 30, 2017.
This report is provided in compliance with Section 4-8.01e of Chapter 836, 2017 Virginia Acts of the General Assembly, which provides:
“e. Utilization of State Owned and Leased Real Property:
1. By November 15 of each year, the Department of General Services (DGS) shall consolidate the reporting requirements of § 2.2-1131.1 and § 2.2-1153 of the Code of Virginia into a single report eliminating the individual reports required by § 2.2-1131.1 and § 2.2-1153 of the Code of Virginia. This report shall be submitted to the Governor and the General Assembly and include (i) information on the implementation and effectiveness of the program established pursuant to subsection A of § 2.2-1131.1, (ii) a listing of real property leases that are in effect for the current year, the agency executing the lease, the amount of space leased, the population of each leased facility, and the annual cost of the lease; and, (iii) a report on DGS’s findings and recommendations under the provisions of § 2.2-1153, and recommendations for any actions that may be required by the Governor and the General Assembly to identify and dispose of property not being efficiently and effectively utilized."
See Page 1 of the Report for the Summary of Savings and Income during the Period of November 2016 to November 2017.
The Savings and Income negotiated by DGS increased in all categories this year, except for the Surplus Real Estate Being Negotiated for Sale category. The real estate transaction that was in process last year transitioned to Surplus Real Estate Under Contract. Lease savings throughout this report are divided between cost savings and cost avoidance.
Cost savings are defined as the reduced occupancy costs typically attributable to renegotiation of existing rents, reconfiguration of space to reduce rented areas, collocation efficiencies achieved, and relocating from leased to owned properties, when that is the most economical choice. These savings reduce the real cost of doing business for the occupying agency.
Cost avoidance is typically attributable to improved economic terms through value added in negotiations. Examples of cost avoidance include the landlord’s agreement to pay a larger share of the cost of tenant improvements and/or the landlord’s agreement to pay for furnishings and equipment ordinarily paid by the tenant.
The combined report for 2017 follows.