The Trump administration this week renewed its effort to scale down the federal government’s real estate footprint, announcing the sale of a nearly 1 million-square-foot vacant federal office building that once housed the Department of Homeland Security.
The General Services Administration, the federal government’s real estate arm, said Wednesday that the agency had sold the 940,000-square-foot regional office to Dalian Development. The Washington-based private developer plans to turn the property, which spans nearly 3½ acres next to L’Enfant Plaza at 7th and D streets in Southwest Washington, into rental apartments, according to the Washington Business Journal, which first reported the sale.
Dalian and the company’s chief executive, Hossein Fateh, did not respond to requests for comment from The Washington Post, but Fateh told the Journal that early-stage plans call for a museum, possibly aimed at children, on the ground floor.
Dalian paid $24 million for the building, according to a source familiar with the deal who spoke on the condition of anonymity because they were not authorized to discuss the agreement — a price that reflects the steep decline in office values nationally since the pandemic. GSA said the building is among a host of federal properties in D.C. that are underused and too expensive to maintain. The sale will spare taxpayers from absorbing $200 million in delinquent maintenance and $5.5 million in annual operating costs for a structure that has sat vacant since March 2025, the agency said. The building was originally constructed as a warehouse between 1929 and 1932, later adapted for office use.
“GSA is leading by example, eliminating underutilized property and delivering savings to the American taxpayer,” Administrator Edward C. Forst said in a statement.
The deal was the administration’s first sale of a major D.C. office building, one that will serve as “an important blueprint” for future sales, GSA said in a news release. The agency’s nationwide push to shrink its real estate portfolio has particular resonance in Washington, where clusters of underused federal buildings offer sweeping redevelopment opportunities.
GSA estimates saving $5 billion in delinquent maintenance and annual operating costs by selling off the nearly 50 properties it tagged for “accelerated disposition.” Several have already sold, including a Social Security office in Racine, Wisconsin, and courthouses in Des Moines and Portland, Oregon, according to GSA’s website.
The effort got off to a chaotic start. In March 2025, the administration announced 443 federally owned properties across the country were for sale without first consulting many of the agencies whose buildings appeared on the list. The speed and scale of the proposed off-loading, which included the Justice Department’s headquarters, stunned regional officials and real estate experts. The administration reversed course within hours, paring down the list and then removing it from the GSA website entirely that night.
The agency has since proceeded in “a more measured way,” according to its website.
Among other D.C. targets, the GSA is preparing to sell the Old Post Office, a 19th-century Pennsylvania Avenue landmark that sits between the White House and the Capitol. “Transferring this property out of Federal ownership will generate revenue, save taxpayer dollars, and help rightsize the federal real estate portfolio,” a GSA spokesperson told The Post in January. The sale has not yet been finalized.
That building previously housed one of President Donald Trump’s luxury hotels, serving as a clubhouse of sorts for Republicans during his first term. The building is now home to a Waldorf Astoria. The 315-foot tower’s public observation deck — once a popular destination for its sweeping views of the capital — has been shuttered since the sale process began.
GSA is also looking to off-load the Robert C. Weaver Federal Building, the hulking brutalist headquarters of the Department of Housing and Urban Development, also near L’Enfant Plaza, which faces more than $500 million in deferred maintenance. In January, the agency initiated the historical consultation process required before any sale can proceed, records show, a sign of the regulatory complexity involved.
Politicians of both parties have long acknowledged that many federal buildings are outdated and underused. Local officials have pushed for years for the federal government to sell vacant properties to revitalize dormant pockets of the capital while bolstering the city’s tax rolls. But disposing of federal real estate is rarely simple: The rules are extensive, preservation reviews take time, and buyers in a depressed office market are scarce. Officials hope this week’s deal, which took 60 days from start to finish, is proof the process can move quickly.
“That’s unheard of in federal government,” said Jeff White, a GSA spokesman.
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