GPO’s Real Estate Firm Disputes Criticisms
The global real estate firm tasked with crafting a plan to develop the Government Publishing Office’s parking lot is disputing an independent report claiming it mishandled lease negotiations with another government agency.
The GPO awarded CBRE a consulting services contract for the parking lot development last week, citing the firm’s experience with other federal government projects. But the U.S. Postal Service Inspector General found flaws in the firm’s lease negotiations and estimated the postal service could be overpaying $9.5 million a year for leases negotiated by the company. Asked about the IG’s findings, GPO spokesman Gary Somerset noted that the contract to prepare a plan for the parking lot differed from the USPS contract in scope and nature.
In an email Tuesday, a CBRE spokesman went further, pointing out that USPS pushed back on some of the Inspector General’s findings. Though the IG suggested USPS terminate its contract with CBRE, USPS argued in its response that doing so would be unwise.
“[On] an overall basis, CBRE consistently has delivered most leases with at or below market lease rates for the Postal Service,” the agency wrote.
CBRE spokesman Robert McGrath wrote in an email Tuesday, “As the USPS management thoughtfully explained in their response, the report ignores a number of factors that could have substantially changed the findings and recommendations. As USPS management also explained, we have not only followed the standard business practices explicitly defined in our contract but also made changes to our contract that benefited USPS when appropriate.”
He argued there were other areas where CBRE has benefited USPS, including millions of dollars in sales as well as labor cost savings.
“We are committed to cooperating with any governmental review and providing them with the details on the standard industry practices and how our performance has effectively served the interests of the USPS, its customers and the U.S. taxpayers,” McGrath wrote.
CBRE and the GPO are expected to present a plan for the GPO parking lot for congressional approval in six months.
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