GSA & Trump Reach Deal on Old Post Office Lease
Wednesday June 5th, 2013 - 2:49PM GH
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WASHINGTON, DC—The U.S. General Services Administration (GSA) announced it has completed negotiations with the Trump Organization on a 60-year lease agreement to redevelop and manage the iconic Old Post Office building and annex on Pennsylvania Avenue in Washington, DC. Under the agreement, $200 million of private sector funds will be invested to restore the 114-year-old federal building and convert it into a luxury mixed-use development—Trump International Hotel, The Old Post Office, Washington DC—that will serve the local community, preserve the facility, and save taxpayer dollars. The pending agreement now moves to Congress for a review period of 30 in-session days.
“Redeveloping the Old Post Office with a private sector partner will save millions of taxpayer dollars while restoring a unique and important historic asset,” Dan Tangherlini, GSA acting administrator, said in a statement. “GSA is committed to delivering the best value for the American people and managing federal real estate assets efficiently. We are pleased that the negotiations have finished and the deal now moves to Congress for review.”
“It is a great honor and privilege to be given the responsibility of transforming one of our country’s most important landmarks into what will be one of the great hotels of the world,” Donald J. Trump, chairman and president of The Trump Organization, stated.
“It has been a tremendous pleasure to work with the GSA and the numerous agencies and organizations that have been involved in getting us to this important milestone in the project’s redevelopment. Our plans are virtually complete and we look forward to starting construction immediately upon turnover of the building,” added Ivanka Trump, EVP of development and acquisition.
GSA and the Trump Organization have been negotiating for more than a year on the terms and conditions of this complex transaction. GSA selected the Trump Organization as the preferred developer after an open and competitive process.
The Old Post Office, located at the corner of 12th Street and Pennsylvania Avenue in the Federal Triangle neighborhood, is currently used primarily as federal office space. Through the Old Post Office Redevelopment Act of 2008, Congress directed GSA to redevelop the Old Post Office in a cost-effective manner. The lease agreement provides a path forward for the preservation of the historic features while allowing the private sector to develop it to its fullest potential while also creating economic development opportunities. GSA is relocating the existing federal tenants in the Old Post Office, including the Advisory Council on Historic Preservation, the National Endowment for the Arts and the National Endowment for the Humanities.
The Trump Organization proposal calls for converting the Old Post Office to a luxury hotel with more than 260 rooms, along with restaurants, an expansive spa and conference and ballroom facilities, while preserving and enhancing all of its historic features. The redevelopment is expected to start in 2014 with the hotel opening scheduled in 2016. Under the agreement, the Old Post Office’s clock tower will continue to be open to the public and will continue to be managed by the U.S. Department of the Interior’s National Park Service.
Tags: • Hospitality • Construction/Renovation • Ownership •
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