- The Washington Times - Monday, December 11, 2000

The federal Securities and Exchange Commission is looking for a new headquarters, five years after planning a move to Silver Spring that ignited a battle between Montgomery County and the District.

The commission, now based in 450,000 square feet at 450 Fifth St. NW, is seeking about 650,000 square feet in a new building, according to spokesman Chris Ullman.

The agency employs about 1,800 workers. Its lease expires in December 2002, although it has an option to extend its stay by another year, Mr. Ullman said.

"We are moving expeditiously on this. We only have a three-year window to do this," he said.

The commission, which regulates public companies, considered moving to Silver Spring in 1995 before bowing to political pressure and choosing to stay at its current building in downtown Washington.

The search sparked a battle between the District and Montgomery County, with each jurisdiction offering incentives to entice the agency.

Mr. Ullman said the commission is growing and requires an updated headquarters. The commission also leases about 43,000 square feet at 901 E. St. NW.

In August, the General Services Administration, the government's real estate arm, issued its invitation to developers and landlords offering space for the commission, Mr. Ullman said.

He could not provide information on the number of bids submitted, but said a decision could be made early next year.

The commission is the second big federal agency seeking a new office.

GSA is expected to announce next year whether it will keep the Department of Transportation's headquarters at L'Enfant Plaza in Southwest or move it to a new building.

The Transportation Department needs about 1.35 million square feet for its headquarters. It is seeking a 20-year lease expected to cost at least $55 million annually.

The requirements for the Securities and Exchange Commission, though not as large as the Transportation Department's search, is still significant, according to analysts.

"Anytime there is a procurement for that much space it is significant," said Scott C. Price, research chief for Delta Associates, an Alexandria-based real estate research firm.

Mr. Price said it is not clear how much rent a landlord could command from a tenant as big as the commission. The most premium office space in the District leases for about $55 a square feet, but those figures could fall if there is an economic downtown, he said.

Mary S. Petersen, research chief for Cassidy & Pinkard Inc., a D.C.-based brokerage, said finding 650,000 square feet of space in one building will be tough.

"The question is, 'Where would they go?' There is nothing available right now," Mrs. Petersen said.

She predicted most of the offers to provide the commission with space will come from developers building so-called speculative offices, which are constructed without tenants lined up.

Delta Associates said developers have proposed 7.5 million square feet of new office space through September 2002.

By comparison, Delta said 19.7 million square feet has been proposed in Northern Virginia, and 5 million square feet has been proposed in Montgomery and Prince George's counties in Maryland.

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