The changing dynamics and competitive pressures of the postal industry should catalyze introspection to monetize its real estate portfolio. USPS core business is not be a real estate owner. Portfolio analysis and segmentation ensures that maximum value is extracted real estate owned. We urge new Postmaster General Louis DeJoy to segment and monetize its considerable real estate assets.
United States Postal Service (USPS) is in dire financial straits and in desperate need of reform. Monetization of its real estate portfolio offers significant advantages.
President Trump has threatened to block federal aid for the U.S. Postal Service unless it raises shipping rates for online companies. We agree. And go a step further urging a monetization of USPS significant real estate assets.
The USPS has been in the spotlight in recent years due to the dramatic and ongoing changes affecting the industry and the change in way customers consume information. In other countries too, liberalization of the European postal market and other pressures from alternative means of communication are forcing operators throughout the world to consider innovative ways to raise funds and improve balance sheets by rationalizing asset bases. In many countries the postal agency is the largest owner of real estate in a country, thus requiring an effective real estate strategy – but is seldom implemented. Postal operators around the world have already publicly announced their intention to close and monetize post offices in large numbers or are developing strategies to manage their existing portfolios.
Between 2007 and 2018, the Postal Service has experienced net losses totaling $69 billion and around $9 billion in 2019. Americans are mailing fewer and fewer First Class letters and USPS generating less revenue and cannot cover its operating costs. Declines in mail volume and the costs of its pension and health care obligations will continue to rise further exacerbating costs. USPS should get out of the real estate business.
President Trump has threatened to block federal aid for the U.S. Postal Service unless it raises shipping rates for online companies. We agree. The USPS is in dire financial straits and in desperate need of reform, and should remain a government agency. Outright privatization is not a viable option. USPS has been sitting on a huge real estate portfolio that it should monetize, for its core mission is not to be a real estate owner and operator.