GSA’s Greater Southwest Region entered into a lease agreement with the Galveston Historical Foundation (GHF) for the Customhouse in Galveston, TX. The Customhouse, which is one of the oldest Federal buildings west of the Mississippi River, was outleased to the GHF for a term of 60 years. The GHF will preserve and restore the Customhouse to ensure the historic integrity of the asset, which is listed on the National Register of Historic Places. Once repairs are made, the Customhouse will house the GHF headquarters and a visitor center for the historic Strand District of Galveston.
While the exterior of the building was in good condition, the interior space had fallen in disrepair. Most tenants had relocated to the newer Federal Building in Galveston. Recently the building housed only six people. The cost to operate and maintain the historic Customhouse became too much for such an underutilized asset. The second floor had been declared uninhabitable, as it was only accessible via an open iron stairwell. However, due to the historical significance of the building, it was not a candidate for disposal. Initial efforts to lease space to private sector tenants were unsuccessful because GSA did not have the funds to renovate the Customhouse.
That is when the GHF stepped forward. They leased the Customhouse for 60 years and assumed all operating expenses, alleviating the financial strain on GSA of operating an underutilized asset. This outlease will provide GSA $162,000 in an annual cost avoidance for operating the building. The Customhouse also benefits from $1 million that the GHF has invested in restoration and repair work. The city and Historic Strand District also benefit by the continued use and preservation of one of its most significant buildings.
For more information, contact Mr. Harold Hebert at (817) 978-4660 or via e-mail at harold.hebert@gsa.gov
