For the past two decades, the United States Postal Service (USPS) has struggled under a persistent revenue shortfall. USPS remains critical national infrastructure, but is hamstrung by net losses totaling billions of dollars annually, driven by declining mail volume and high operating costs within its nationwide service network. To ensure USPS remains a strong public enterprise, it must identify new, sustainable sources of revenue that do not diminish the quality of service nor the strength of its workforce.
Meanwhile, the United States currently faces another, seemingly unrelated challenge: a severe housing supply shortage. This report proposes a strategy to address both of these challenges by using the Postal Service’s real estate portfolio to build housing and generate new ongoing revenues. The goal is not to privatize USPS but instead to use the agency’s greatest asset—its land—to strengthen the public enterprise. By modernizing how it uses its properties, USPS can generate the stable revenue needed to fulfill its public mission while simultaneously boosting housing supply. And while this report focuses on the housing potential of Postal Service land, our analysis is useful for a broader array of land uses that can add value and productivity to the agency.
Our analysis indicates that redeveloping underutilized postal sites could produce up to 237,000 housing units nationwide. Approximately 117,000 of these units are located in high- or medium-demand areas where new supply is most urgently needed. Beyond increasing housing stock, this initiative would be a significant financial engine for the Postal Service. We estimate building housing on all medium- and high-demand parcels could generate approximately $2.2 billion in annual rent receipts, which would yield large enough net revenues to significantly offset the USPS’ current annual controllable operating losses.
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