How much are the government buildings, lands and other publicly-owned real estate of your country worth? According to recent publications, a lot. A 2013 IMF study estimated that non-financial assets are worth an average of 67 percent of the GDP of a selection of 32 countries.
More recently, a book by Dag Detter and Stefan Fölster underscored the incredible potential of improving public wealth management. According to their calculations, a one percent increase in returns to public assets worldwide (including real estate) would generate gains equal to roughly one percent of global GDP! In the United States, a one percent increase in yields from federal assets would be equivalent to the revenue raised from a four percent tax increase. But why are governments sitting on so much unused wealth?
And what can they do to make better use of what they have?
Seeking to reap the fruits of smarter public real estate management, representatives from twenty countries from around the world met in Mexico last September. Participants discussed how to turn the management of public real estate assets into a tool for good governance, including strategies to optimize the use of government property and generate savings in maintenance. The conference was organized by The Workplace Network (TWN), an international public real estate management network, with participation of the World Bank and the Inter-American Development Bank.