October 4, 2013
The Postal Service and its real estate broker CBRE have created a new website advertising postal properties for lease. It’s the companion site to the USPS-CBRE Properties for Sale website, which went up in November 2011. The domain name for the new site was registered in April 2013, but the site may have gone online just in the past few weeks.
The Properties for Lease site currently lists 82 postal facilities, most of them post offices. The listings indicate the total square footage of the building and the vacant square footage available for leasing; in some cases, there are a few more details, like what floor the space is on or what it might be suitable for (office, retail, etc.). It would appear that the Postal Service plans to maintain a retail postal operation in the building and to lease out the area that isn't being used (like the space in the back where carriers used to work).
Thirty-three of the 82 listings are historic post office buildings; at least five are on the National Register of Historic Places. The new website may be an indication that the Postal Service is shifting strategies. Instead of selling historic post offices — a source of much controversy across the country — it has decided to lease out the extra space. The Postal Service often leases space in its properties, but it’s possible that the Properties for Lease website represents a new approach to the question of what to do with facilities with excess space, especially historic post offices.
The Postal Service has been using the existence of excess space as an explanation for why it wants to sell off post office buildings. Time after time, the Postal Service has said that mail volumes are falling, the building is too large, there’s too much space not being used, and a small retail outlet would suffice.
When communities have asked why not just lease out the extra space rather than selling the building, the Postal Service has not seemed very responsive. Bringing in the fast cash from a sale has seemed preferable to holding on to a historic landmark building. But there are many reasons why leasing would be a better idea.
One reason is that there is a federal regulation (41 CFR 102-73.20) that requires government agencies to "extend priority consideration to available space in buildings under the custody and control" of the Postal Service. In other words, as a matter of law, federal agencies should be looking at post offices for office space.
Leasing space is also encouraged by a Memorandum of Agreement between the Postal Service and the GSA, which supports an executive order that directs federal agencies to locate their facilities in business districts and urban areas. Under this agreement the Postal Service should be offering its excess space to the GSA.
Along similar lines, a 2012 GAO report recommended that the Postal Service do more to make its excess space available to other federal agencies. In its response to the GAO, the Postal Service stated, "In situations where USPS has identified underutilized space, we are actively and aggressively pursuing third party tenants where deemed appropriate by engaging CBRE, a National Real Estate Services Provider."
The new Properties for Lease website is the first sign that CBRE and the Postal Service are in fact aggressively seeking tenants. Until now, there has not been much indication that any effort has been expended to lease out the extra space in the historic post office buildings being sold. Coast to coast, from the Bronx and Chelsea in New York City to Venice, La Jolla, Ukiah, Redlands, and Berkeley in California, the Postal Service has decided that it will sell the building without looking at alternatives.
On Saturday, September 21, there was a "Day of Action to Save the Post Office" in the Bronx, New York. The event began with an "Emergency Meeting to Save the Post Office" at the Lincoln Hospital Auditorium, 234 East 149th Street. Among the speakers were Jacquelyn McCormick of the National Post Office Collaborate; Congressman Jose E. Serrano; Jonathan Smith, President New York Metro Area Postal Union, APWU; and Julio Pabon, a community activist who has filed appeals to stop the sale of the Bronx GPO.
October 2, 2013
The Postal Service is well along in its implementation of POStPlan, the initiative to cut hours at 13,000 post offices and replace their postmasters with part-time workers. Since beginning the process a year ago, the Postal Service has reduced hours at about 8,300 post offices. Another couple of hundred will be reduced over the coming weeks.
In the request for an exigent rate increase submitted to the Postal Regulatory Commission last week, the Postal Service reviewed some of the steps it has taken to cut costs over the past few years, including POStPlan. The request indicates that in the first nine months of 2013, the Postal Service had implemented POStPlan at 7,397 post offices.
There were about 600 or 700 post offices where implementation took place in the fall of 2012. Another 166 implementations are scheduled for this month. In addition, 193 post offices had meetings scheduled for September and October, and they will have their hours reduced later this year. That adds up to about 8,400 post offices.
Since the beginning of 2013, the Postal Service has published bimonthly lists of of the post offices where POStPlan has been implemented. A list merging all those lists is here, and a map is here. The list includes the implementations from 2012 as well. A separate list of the meetings scheduled for September and October is here (lists of all the meetings are here).
The Postal Service has implemented POStPlan only at offices where there was a postmaster vacancy. At offices where the postmaster has chosen to stay on, POStPlan will not be implemented until September 30, 2014.
The 8,400 postmaster vacancies where POStPlan has been implemented breaks down to something like this: About 2,200 offices had a postmaster vacancy when POStPlan was announced in May 2012. About 4,000 postmasters took the retirement incentive last summer, of which maybe 2,200 were at POStPlan offices (a rough guess). Something like 1,600 POStPlan postmasters transferred to a new position in early fall 2012, another couple of thousand transferred to a position that opened up thanks to the retirements, and a few hundred more have found new positions in recent months.
At this point, POStPlan implementation is over 60 percent complete. This state-by-state breakdown shows that implementation has been fairly uniform across the country. In a few states (Michigan, North Carolina, New Hampshire), the implementation rate is a bit higher, but this is probably just a function of where the postmaster vacancies are occurring.
The rate of implementation has slowed down over the course of the year. As this table shows, during the first quarter of 2013, some 4,600 offices had their hours reduced; during the second quarter, 2,200; and during the third, about 600. The decreasing rate of implementation reflects the fact that there aren’t many offices developing new postmaster vacancies.
Implementation will probably proceed at a pace of about a hundred a month or less for much of 2014. By September 2014, when all of the remaining POStPlan offices will have their hours reduced and all remaining postmasters will be removed from their positions by RIF (Reduction in Force), there will probably be about 4,000 postmasters still in their jobs.
A few of them may be ready to retire anyway — they just passed up the 2012 incentive offer because they wanted to work another two years. But for most of them, September 30, 2014, will be a very unhappy day.
At least in the other POStPlan post offices, the postmaster retired voluntarily or transferred to another post office. For the last 4,000 POStPlan postmasters, there will be nothing very voluntary about how they depart from the Postal Service.
(Photo credit: Post office in Blue Mountain Lake, New York, which is having its POStPlan meeting today.)
October 1, 2013
The historic post office in Stamford, Connecticut, closed on Friday, September 20, with just two days’ notice to customers. The Postal Service has made arrangements to sell the post office to a Westchester developer who plans to tear down a section of the building, which is on the National Register of Historic Places. The sale, however, is now being challenged in federal court.
On Wednesday, September 25 — the closing date for the sale — the Center for Art and Mindfulness (CAM), the National Post Office Collaborate, and Stamford resident Kaysay H. Abrha filed a complaint against Postmaster General Patrick Donahoe and the Postal Service in the U.S. District Court in Connecticut. CAM, formerly known as the Lower Fairfield Art Center, has been trying to buy the building itself in order to preserve the architecture and turn the structure into a center for the arts, art education, and mindfulness, for the benefit of the general public.
The complaint, which was filed along with an application for a temporary restraining order and a memorandum of law in support of the application, argues that the Postal Service has failed to follow the laws regulating the disposal of historic federal properties.
According to the Stamford Advocate, Westchester developer Mr. Louis Cappelli wants to build two luxury apartment towers more than 20 stories high, one next to the post office on land he already owns and another on the parking lot of the post office. His plan involves maintaining at least the exterior of the main part of the building, which was constructed in 1916, and turning it into retail space. HIs plan also calls for razing an addition to the post office that was constructed in 1938 in order to make room for a driveway and parking garage.
The Postal Service first announced plans to close the post office and sell the building back in 2010. At that time, the Postal Service said it would relocate retail services to a new building somewhere nearby. A public meeting was held in August 2010, but it wasn’t very well publicized, and even though it also involved another post office relocation, only a couple of dozen people attended.
It’s not clear if and when the Postal Service completed the relocation process on the Stamford post office. There should have been a public announcement that the relocation was going forward, followed by a 30-day period for appeals and a final determination to relocate. There are no news items about the posting of these documents, but it's possible the Postal Service did not publicize them very much.
What is clear is that the Postal Service proceeded to list the property for sale and to entertain offers. The Postal Service selected Cushman and Wakefield as its realtor, and an auction was held in May 2012. CAM submitted the high bid of $5.5 million. Mr. Cappelli was the only other bidder.
According to the complaint filed this week, CAM tried to negotiate a purchase agreement with the Postal Service that was contingent on arranging the financing and that included a reasonable down payment and a year to raise the money. The Postal Service said it would accept only a noncontingent agreement, so it declined CAM’s offer and turned to Cappelli.
The Postal Service offered Cappelli the opportunity to purchase the building at a lower price than CAM had offered, under pretty much the same terms that it had denied CAM — a contingent offer allowing the purchaser one year to look for tenants and financing. The deal with Cappelli had a purchase price of $4.3 million and a closing date of September 25, 2013.