Fort Riley A private company has taken over housing at Fort Riley, as part of a Pentagon push to turn over more military housing to private management.
Under the agreement, Picerne Military Housing on July 1 will take over management of more than 3,114 housing units at Fort Riley. It also plans to build 400 units in six neighborhoods in the next 10 years, said Charlie Williams, director of Residential Communities Initiative at Fort Riley.
Picerne Military Housing, a division of Picerne Real Estate Group from Warwick, R.I., also will replace 1,600 units.
The deal, worth $3 billion over 50 years, is expected to close July 1, Williams said.
More housing is needed at Fort Riley because the number of soldiers is expected to grow from 12,000 to 18,500 by 2010, Williams said.
Most of the housing needs will be off the base, with thousands of new homes expected to be constructed.
John G. Picerne, president and chief executive officer of Picerne Military Housing, and Joseph Whitaker, deputy assistant secretary of the Army, Installations and Housing, signed the deal Thursday.
Williams said the contract will bring Picerne revenue of more than $2.6 million a month, based on the current 3,050 housing units available on base, average monthly rent of $885 and a 98 percent occupancy rate. The money will be used for management, maintenance, construction and replacement of housing and debt service.
In 1996, Congress started allowing private developers to build and operate military housing, in part because the Pentagon estimates 60 percent of its 273,000 housing units need renovations that would cost taxpayers $16 billion under traditional contracts.