CenterPoint Properties & the NNSA Set a New Precedent for Government Real Estate

Executive Summary

The U.S. government owns nearly 3 Billion SF and 42 Million acres of real estate1 across the nation. In the past decade, a number of initiatives have been introduced in order to reduce the amount of under-utilized public sector properties and foster more sustainable real estate solutions, including the White House’s “Campaign to Cut Waste” and the Office of Management and Budget’s “Freeze the Footprint” policy.

This case study discusses how CenterPoint Properties partnered with the U.S. General Services Administration (GSA) to develop the National Nuclear Security Administration’s (NNSA) new National Security Complex in Kansas City, Missouri—an intricate project that not only reduced the Administration’s space and energy footprint, but ultimately set a new standard for government real estate developments going forward.

Finding Creative Solutions to Meet Complex Government Property Needs

As early as 2010, the U.S. federal government has led the charge to improve its real estate management capabilities, eliminating excess properties and identifying new cost savings opportunities. A 2010 directive from the President pushed federal agencies to purge $8 Billion in real estate expenses by 2012.2 A 2011 Executive Order launched the “Campaign to Cut Waste,” an initiative to help agencies reduce all forms of wasteful spending; in 2013, the Office of Management and Budget unveiled its “Freeze the Footprint” policy to better maintain agencies’ square footage of office and warehouse space.3,4.

To comply with these new programs, many state and federal agencies are looking to dispose of or redevelop surplus real estate. Exemplifying this trend is the NNSA, an agency within the U.S. Department of Energy, which is responsible for the management and security of the nation’s nuclear weapons, global nuclear nonproliferation and naval reactor programs, as well as other national security-related projects.

In 2007, the GSA issued a solicitation for offers to develop a new facility for the NNSA in Kansas City, MO, in hopes of replacing the NNSA’s underutilized, inefficient space at the antiquated Bannister Federal Complex.

Over the past few years, the NNSA has pursued its own property realignment efforts through its “Complex 2030” initiative. The program, unveiled in 2007, is a strategic plan for modernizing the country’s nuclear weapons complex, across the Administration’s eight major US facilities.5 Through this program, the NNSA hopes to reduce the total square footage of the complex, consolidating its materials into safer, more efficient facilities.

Also in 2007, the U.S. General Services Administration announced a solicitation for offers to finance, develop and manage a new campus for the NNSA Kansas City Plant, which manufactures and procures nonnuclear components for nuclear weapons. Due to the highly sensitive nature of the NNSA’s operations and scope of its facilities, any plans to develop a new property would need to accommodate more than 1 million detailed requirements, such as:

A New National Security Campus

In 2009, after a competitive bidding process, the GSA officially selected CenterPoint, in conjunction with Zimmer Real Estate Services in Kansas City, to design, build, own and operate the new NNSA National Security Campus.6 By 2010, construction was underway on the NNSA’s five building, 1.5 Million square-foot complex.

Introducing A Modern Model

Construction on the NNSA’s National Security Campus ended in late 2012, and by early 2013 the agency began relocating its staff of nearly 2,500 employees to the new complex. The $820 Million facility has since set new standards for government real estate efficiency and modernization on a number of fronts, such as:

Over the course of a few years, CenterPoint helped the NNSA bring its plans for a state-of-the-art, environmentally responsible campus to fruition. The new consolidated facility will save the government an estimated $100 Million in annual operating expenses.

Resetting the Bar

The NNSA’s National Security Campus has become one of the first developments to align with the federal government’s real estate savings and modernization goals. Partnering with CenterPoint, the NNSA not only supported its mission to transform its infrastructure into a 21st century nuclear security enterprise, but also pioneered a new model of efficiency for real estate developments throughout the U.S. government.

CenterPoint’s on-time, under-budget delivery of this large scale, intricate project has recalibrated expectations for how these developments should be planned and executed. Due to the success of the National Security Campus assignment, CenterPoint was subsequently selected to lead demolition and cleanup efforts for the 5.1 Million square foot Bannister Federal Complex, which formerly housed the NNSA and other public sector agencies—ensuring that another piece of government property isn’t forgotten or underutilized.

The NNSA initiative embodied the power of public-private collaborations done well, and has consequently paved the way for similar partnerships – and comparable success – in the future.

About CenterPoint Properties

CenterPoint is focused on the development, acquisition and management of industrial property and transportation infrastructure that enhances business and government supply chain efficiency. The company invests in major coastal and inland port logistics markets anchoring North America’s principal freight lanes. For more information on CenterPoint Properties, visit www.centerpoint.com or follow @centerpointprop on Twitter.

CenterPoint’s development projects have earned two U.S. EPA Phoenix Awards and numerous city, state and federal accolades, including various levels of LEED certifications. Strategically located near ports, rail terminals and population centers, our properties help companies increase logistics efficiency and reduce drayage, energy costs, waste output and the environmental impact and cost of transportation.

Sources

1.”FY 2013 Federal Real Property Charts,” U.S. General Services Administration. http://www.gsa.gov/portal/content/102880

2. “Freezing the Footprint,” Werfel, Danny. Office of Management and Budget. March 14, 2013. http://www.whitehouse.gov/blog/2013/03/14/freezing-footprint

3. “Campaign to Cut Waste,” The White House. June 13, 2011. http://www.whitehouse.gov/goodgovernment/actions/campaign-cut-waste

4. “Agencies forced to freeze office space footprint,” Larson, Lauren. Federal News Radio. March 14, 2013. http://federalnewsradio.com/management/2013/03/agencies-forced-to-freeze-office-space-footprint/

5. “NNSA Release Report on Plans for Future of the Nuclear Weapons Complex,” February 2, 2007. http://www.nnsa.energy.gov/mediaroom/pressreleases/nnsa-releases-report-plans-future-nuclear-weapons-complex

6. “NNSA National Security Campus,” U.S. General Services Administration.

7. “FY 2012-2021 Ten-Year Site Plan,” U.S. National Nuclear Security Administration and Honeywell Federal Manufacturing and Technologies. April 2011. 

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