15 FAM 400
real PROPERTY ACQUISITION abroad
15 FAM 410
general policy and scope
(CT:OBO-119; 04-14-2023)
(Office of Origin: OBO/PRE)
15 FAM 411 AUTHORITY AND SCOPE
15 FAM 411.1 Authority
(CT:OBO-1; 04-29-2005)
The Foreign Service Buildings Act of 1926, as amended (22 U.S.C. 292 - 302), and the Foreign Assistance Act of 1961, as amended (22 U.S.C. 2396).
15 FAM 411.2 Scope
(CT:OBO-119; 04-14-2023)
This subchapter applies to the acquisition of real property abroad in the name of the U.S. Government. It encompasses purchases, exchanges, gifts, and capital leases (CLs) for use as nonresidential or residential space by the Department of State and other U.S. Government agencies represented at post and their employees. CLs are treated as acquisitions for purposes of programming, authorization, and funding; however, the leasing regulations of 15 FAM 300 govern the documentation required for CL proposals and lease contracts. See 15 FAM 432 through 15 FAM 460 for procedures to implement these regulations. Direct any questions or comments on these regulations or procedures to the Directorate of Planning and Real Estate in the Bureau of Overseas Buildings Operations (OBO/PRE), for Department of State properties, or in the case of U.S. Agency for International Development (USAID) properties, the Overseas Management Division, Office of Management Services, Bureau for Management, USAID/Washington (USAID/W-M/MS/OMD).
15 FAM 412 POLICY
15 FAM 412.1 General
(CT:OBO-119; 04-14-2023)
a. U.S. Government-owned property allows the post stability, flexibility, and cost control. However, purchasing property requires large initial outlays of funds and ongoing maintenance costs, so the Department must carefully weigh the benefits of leasing versus purchasing.
b. Only the Department of State and the U.S. Agency for International Development (USAID) are authorized to buy real property abroad for diplomatic use. Post must not take independent action on real property acquisition matters. The Bureau of Overseas Buildings Operations (OBO) for Department of State properties, or, in the case of USAID properties, USAID/W-M/MS/OMD, must oversee all real property acquisition negotiations.
c. Throughout 15 FAM 400, references to OBO are deemed to apply to State properties and references to USAID/W-M/MS/OMD are deemed to apply to USAID properties.
d. Except as noted herein, the Department of State neither constructs nor acquires residences with swimming pools:
(1) The Department may purchase or construct residences with swimming pools at Chief of Mission Residences (CMR), Deputy Chief of Mission Residences (DCR), Principal Officer Residences (POR), and Marine Security Guard Residences (MSGR).
(2) Post may recommend purchase of a residential property with a swimming pool if appropriate residential properties come equipped with swimming pools as a result of the country’s climate, culture, or other factors:
(a) Posts recommending purchase of a residential property with a swimming pool must provide justification (see 15 FAM 432.2). The decision to purchase must be based on a financial analysis that takes into consideration the appraised value, comparable prices for similar properties (with and without swimming pools), and the present value of the property versus rental cost; and
(b) Posts will not require owners to install swimming pools as a condition of or prerequisite to purchase. Installation of a swimming pool is considered a minor improvement subject to the policy and procedures of 15 FAM 600;
(3) Swimming pools located at U.S. Government-owned or leased housing must have at least a 4-foot fence or other barrier surrounding the entire swimming pool and separating pools from residences. The gate must be self-closing, self-latching, and lockable; the latch must be at least 4.5 feet off the ground (an extension of the gate or a gate that is higher than the surrounding barrier may be required). Refer to 15 FAM 957.4 and 15 FAM 252.5 a (3) for additional guidance concerning this requirement.
15 FAM 412.2 USAID Acquisition of Property
(CT:OBO-119; 04-14-2023)
(USAID only)
Section 636(c) of the Foreign Assistance Act of 1961 authorizes USAID to purchase, construct, or execute a capital lease for residential or nonresidential facilities when a USAID mission cannot meet its basic requirements by leasing or through use of U.S. Government or cooperating-country government property available to USAID. (See 15 FAM 460 for conditions and limitations on USAID authority.)
15 FAM 412.3 Purchase Agreements
(CT:OBO-119; 04-14-2023)
When OBO authorizes the purchase of real property for the Department of State, or, in the case of USAID properties, USAID/W-M/MS/OMD authorizes the purchase of real property, post must prepare a written agreement that may consist of a sales contract or, subject to local law, a purchase option. OBO and the Office of the Assistant Legal Adviser for Buildings and Acquisitions (L/BA) for Department of State properties, or, in the case of USAID properties, USAID/W-M/MS/OMD, must review and approve all such agreements prior to execution.
15 FAM 412.3-1 Required Provisions for Purchase Agreements
(CT:OBO-119; 04-14-2023)
15 FAM 442 covers the requirements and guidelines for purchase agreements. Whether arising out of a formal sales contract or out of an option and exercise of the option, the purchase agreement must conform to these requirements.
15 FAM 412.3-2 Special Rights
(CT:OBO-119; 04-14-2023)
a. If a stream of water runs through a property, post (with guidance from OBO or USAID/W) must investigate the water rights and obtain the legal right to the permanent flow of water.
b. If necessary and useful under local law, post should obtain the local authorities’ written confirmation that the property will not be subject to the extension of any streets through easements or encroachments upon the property after its purchase.
c. The deed or other instrument should convey any other special rights simultaneously with the transfer of title.
d. Post must confirm the full bundle of rights that is inherent in the acquisition (e.g., mineral rights, air rights, access, etc.)
15 FAM 412.3-3 Payment
(CT:OBO-119; 04-14-2023)
a. Unless OBO for Department of State properties, or, in the case of USAID properties, USAID/W-M/MS/OMD, authorizes otherwise, post should pay the purchase price and the fees for any other incidental expenses, such as water rights, when the title transfer is complete.
b. Offshore payments for the acquisition of real property require an OBO waiver.
15 FAM 412.3-4 Acquisitions by Gift
(CT:OBO-119; 04-14-2023)
Any offers or gifts to post must be reported to OBO/PRE for Department of State properties, or in the case of USAID properties, USAID/W-M/MS/OMD. Post may not accept any gifts without prior approval (see 15 FAM 443). Gifts include real property, improvements to real property, furniture, furnishings, equipment, stocks, bonds, or other valuables offered to the U.S. Government for the purpose of supporting the U.S. Government’s foreign buildings and properties program.
15 FAM 412.4 Documents and Records
(CT:OBO-119; 04-14-2023)
Posts must maintain and submit to OBO, documents and records relating to real property acquisitions (see 15 FAM 450). Post must enter all pertinent Real Property Application (RPA) data in the RPA data base as soon as the purchase is completed. In the case of USAID acquisitions, these documents and records must be submitted to both USAID/W-M/MS/OMD and OBO.
15 FAM 413 POLICY TO VALUE REAL PROPERTY FOR ACQUISITIONS
(CT:OBO-119; 04-14-2023)
a. Real estate (nonresidential and residential): In order to protect the financial interests of U.S. taxpayers when the Department acquires real estate abroad, the Department of State and USAID will obtain two independent professional appraisals. The Office of Master Planning and Evaluations (OBO/PRE/MPE/EV) is responsible for the selection of the appraisers and the review of the appraisal reports. This appraisal requirement also applies to all property exchanges.
(1) OBO/PRE will request appraisals allowing enough time for the Department to make credible business decisions regarding pricing and marketing strategy prior to placing a property on the market. A minimum of 60 days is recommended to complete the appraisal process. Appraisals will be funded by OBO for Department of State properties;
(2) Questions regarding this appraisal requirement or scope of work to procure appraisals may be directed to OBO/PRE/MPE/EV;
(3) The appraisal requirement may be waived by the OBO/PRE/MPE/EV Division Director if: the cost of the appraisal(s) appears high relative to the amount at stake; or if only a single credible appraisal can be obtained; or if local conditions and experience indicate that no credible appraisals can be obtained; or if the OBO/PRE/MPE/EV Division Director determines that there is sufficient information for OBO/PRE/MPE/EV to perform an in-house appraisal; or if it is in the best interests of the U.S. Government based on the facts and circumstances.
b. In circumstances where OBO/PRE/MPE/EV selects to procure valuation services through post, OBO/PRE/MPE/EV will oversee the Statement of Work (SOW) development and real estate service vendor identification. Allotment of funds will be arranged for by OBO/PRE/MPE/EV upon written request from post. Complete confidentiality must be maintained between the real estate service vendor(s) and OBO/PRE/MPE/EV with respect to the vendor’s work product. OBO/PRE/MPE/EV will develop a reconciled estimate of value (REV).
c. In the case of USAID properties operating independently, the same process as outlined herein will apply for funding, oversight, and approval of appraisals by USAID/W-M/MS/OMD.
15 fam 414 through 419 unassigned