Fannie Mae Hoping That It Can Pay For Surprisingly Expensive New HQ With Irony Bonds

Oh, Fannie.
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A lot of companies end up dealing with all kinds of nightmarish stuff whilst developing and building new headquarters. It's never easy to forecast how costs might surge during the long process of designing and and actually constructing an entire building or campus.

Really.FannieMae

To truly be able to forecast and plan, you'd have to be an expert in the real estate and building markets with a deep understanding of like housing and mortgages...

Costs to complete Fannie Mae’s new downtown headquarters ballooned 53 percent after the agency inked a lease for the space early last year, according to a watchdog report released Thursday, creating “significant financial and reputational risks” to the housing giant’s oversight agency.

Really, Fannie Mae? Really?

The report cites pricey improvements at the new headquarters, currently under construction, including three enclosed glass bridges connecting the buildings, spiral staircases and rooftop viewing decks. As a result of those and other interior and architectural features, the report said, build-out costs for Fannie Mae increased from $164.32 per square foot in January of last year to $252.81 per square foot by March of this year, a 53 percent jump.

But the idea of Fannie mismanaging its own real estate project isn't just deliciously dripping with irony in a vacuum, it's also providing red meat to the GSE's already fervent foes.

U.S. Rep. Ed Royce (R-Calif.), a senior member of the House Financial Services Committee, issued a statement saying the increased budget bolstered the argument for doing away with the GSEs altogether.
“It’s paradoxical that an organization overseeing a huge chunk of the mortgage market can’t get a simple construction project right,” Royce said. “Fannie falling asleep at the wheel in this manner is a perfect representation of the GSEs’ model of private gains and public losses. It’s time to put aside the conversation about releasing this enterprise and instead refocus on how to wind it down.”

Alley...oop.

Growing cost of planned Fannie Mae headquarters comes under fire [WaPo]

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