3. 2005 2007 2009 2013 2015
Hackers target the point-of-sale system of Walmart and
access sensitive information, revealing that the nation’s
largest retailer had a number of significant security
vulnerabilities including storing at least four years’ worth
of unencrypted credit card information.
2005
A June 2007 network intrusion at the Pentagon
resulted in the theft of sensitive Department of
Defense data, including information regarding the
processes and procedures of the DoD that were
deemed valuable to adversaries.
2007
Several U.S. Government websites – including those
of the White House, State Department and The
Pentagon – experience a “distributed denial of service”
attack that takes the sites down for several days.
2009
Farmers Insurance, MasterCard,
and several high-level government
sites are hacked and several thousand
usernames and logins, as well as other
confidential information was released.
2012
An attack on the point-of-sale system used
by Target, the nation’s second largest
retailer, results in 40 million credit and
debit card numbers being compromised.
2013
The U.S. Office of Personnel Management is hacked, with a
total of 21.5 million social security numbers and 5.6 million
fingerprint records compromised. Government-sponsored
Chinese hackers have been identified as the likely source.
Hackers gain access to BlueCross’ system for over six months,
exposing 11 million members’ names, dates of birth, Social
Security numbers, bank account information and other sensitive
information.
Anthem, one of the nation’s largest health insurers, announces
that the detailed personal information of as many as 80 million
current and former customers was compromised.
2015
A group of Chinese hackers orchestrate a sophisticated targeted
attack on corporate infrastructure of Google and at least 20 other large
companies. Access to the email accounts of several Chinese human rights
activists were compromised.
2010
2011
THERISINGTIDEOFCYBERSECURITY
Graphic source: Google searches for cybersecurity over time
Hackers gain access to T.J. Maxx and Marshalls’ 45
million credit/debit card and check information. The
company later paid a $9.75 million settlement in a class
action lawsuit over the breach.
2006
“The most significant breach of U.S. military computers ever” occurred
when a flash drive infected by a foreign intelligence agency uploaded
malicious code to a central military network. The incident led to the creation
of the U.S. Cyber Command in 2009.
Hackers target an oil pipeline in Turkey and inject malicious software that
allows them to tamper with the system – causing an explosion that sent
flames 150 feet into the air.
2008
An “external intrusion” sends the Sony PlayStation Network offline, and
compromises personally identifying information (including credit card details)
of its 77 million accounts, in what is one of the largest data breaches ever.
Bank of America website hacked by a lone Turkish hacker – estimated
85,000 credit card numbers and accounts stolen.
2011 Sony Pictures Entertainment experienced one of the most
devastating corporate attacks in history. Leaked files included
personal details of around 6,000 Sony employees, upcoming
Sony feature films and the salary details of top executives.
The Bitcoin exchange Mt.Gox filed for bankruptcy after $460
million was apparently stolen by hackers due to “weaknesses
in [their] system”.
2014
JLL’s Government Investor Services (GIS) team closely tracks issues
that impact federally-leased real estate. With over $32 billion spent
in the past decade and trillions more planned for decades to come,
cybersecurity will renew federal leasing velocity in ways not seen since
the stimulus package of 2009.
In an effort to educate our clients and provide the substantive analysis
the owner/investor community has come to expect from our practice
group, GIS has prepared a comprehensive report on cybersecurity. This
is a topic that brings up many questions and as thought leaders in this
space, we provide answers and informed guidance.
In this original book, GIS outlines the threat, details the legislative
history, identifies the agencies leading the Government’s
cybersecurity efforts, provides agency-by-agency budget
breakdowns, and, most importantly, examines the potential impact
this transformative movement is going to have on your federally-
leased asset or potential acquisition.
he global cybersecurity market
is currently worth more than
$107 billion and is expected
to grow to over $170 billion by
2020–an annual growth rate
of almost 10%. The effects of
this rate of growth on the U.S. economy should be
meaningful and, potentially, transformative. As the
largest practice group of its kind in the country,
HOW DID WE
GET HERE?
MORE THAN A NEWS STORY
T
4. INTRODUCTION....................................................................................1
THE INFRASTRUCTURE LANDSCAPE............................................ 2
CYBER THREATS BY INDUSTRY...................................................... 4
PROPOSED LEGISLATIVE IMPACT ON REAL ESTATE................... 6
GOVERNMENT CYBER OVERVIEW..................................................8
CYBER SPENDING BY AGENCY.......................................................16
FORECAST..........................................................................................28
INDUSTRY PERSPECTIVES ON CYBER IMPACT.........................30
CYBER GLOSSARY............................................................................32
TABLEOFCONTENTS
5. |BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
he federal real estate market has experienced
a significant decrease in demand in the first
half of this decade. Executive mandates
requiring reduction in space consumption;
Congressional consensus regarding per person
space utilization compression and/or increase
in teleworking among federal employees, have all coalesced into
an unprecedentedly flat demand horizon. While the government
focuses on austerity and reduction in federal space consumption,
there is, however, an area of growth emerging with not only public
economic impact, but impact on the macro economy and the
private sector. Cybersecurity, cyberwarfare and the ripple effects of
cyber focused growth spending will be felt all over the Washington
region and around the country. This report explores and explains
cybersecurity as a policy movement and the potential impact its
implementation could have on the federally-leased commercial real
estate market.
The complicated infrastructure of networks that deliver and protect
information in the cyber age intertwine the destinies of all industries
and institutions. An attack on one network is an attack on all.
Recognizing this fragile interdependency, the federal government
has begun to allocate spending and resources across the entire
federal spectrum.
In an effort to coordinate an organized response, the government
has assigned various agencies responsibilities based on how closely
their mission matches the threat posed by the type of attack.
Moreover, several pieces of legislation have been introduced to
Congress that seek to promote the coordination of existing agencies
to lead the response and create new ones to aid in this charge. Most
importantly, however, the bills seek to confirm financial commitment
to the nation’s cybersecurity efforts by appropriating funding to
augment the current response apparatus and recruit experts to
ensure that the U.S. remains at the forefront of cybersecurity, both
offensively and defensively.
DEFININGCYBER
The impact on your commercial
real estate portfolio
T
This book examines the ways in which
cyberthreats are handled by our three most
important sectors: military, intelligence and
civilian. Each domain handles the threats and
response coordination uniquely because in each
one the goals are decidedly different.
As always, federal priorities come into sharp
focus when analyzing the amount of spending
available to various response units. This report
breaks down this spending on an agency by
agency basis and provides not only a rationale
for it but predicts the way in which this spending
will affect specific agencies’ real estate
portfolios.
Lastly, in the forecast section, GIS interpolates
the statistics and information included hereto
and offers specific predictions on cyber’s impact
on federally-leased real estate both locally and
nationally. The predictions also include insight
in areas of real estate not limited to federally-
leased assets as JLL colleagues across all
disciplines weigh in on cyber’s impact across all
product types.
GIS hopes that the information in this report
provides our investor clients valuable insight
into the future of their federally-leased assets or
potential acquisitions.
1
6. COMMUNICATIONS
odern life consists of a continuous series of
invisible negotiations with vast networks of
electronic infrastructure that control the way we
recognize, process and disseminate information.
In other words, all of the things that we rely on
every day rely on the things that we cannot see.
While the past decade has represented exponential technological
advancements in the way in which we communicate and the speed
at which that communication occurs, it has also introduced new and
dangerous vulnerabilities. The “War on Terror” presented the country
with a living and breathing enemy and, thus, a blueprint for homeland
defense; conversely, the threat of cybersecurity arrives in the form of
an invisible enemy.
This new type of threat requires a new and creative response. As it
has done so many times in the past when prevailed upon to respond
to ever evolving threats and enemies, the U.S. Government has
responded with vigor, ingenuity, and, most importantly, money. This
response is still in its gestation period but the net result is typically
federal: new agencies, increased funding, increased collaboration,
increased scrutiny and a search for innovation.
For owners and investors of federally-leased
assets, it is imperative to understand the
relationship your tenant has to the Government’s
response to cybersecurity.
For the private sector, understanding your
tenants’ cyber-related role will give you a
competitive edge in the market as their space
needs over the coming decades can be affected
by what kind of attack they are guarding against.
Each major industry will care about different
types of cyber threats and the various agencies
that are involved in protecting them.
THE INFRASTRUCTURE LANDSCAPE
WHAT WE RELY ON EVERY DAY RELIES ON THE THINGS WE CANNOT SEE
M
2 3
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
7. o two cyber attacks are the same and this is a fact
recognized by the Federal Government.
The type of information at risk due to a data
breach attack on a bank or financial institution
is very different than one on a nuclear power
plant. As outlined in the accompanying graph, the Government has
organized the threat response on an industry-by-industry basis.
Various agencies are assigned responsibilities based on how closely
their mission matches the threat posed by the type of attack.
For owners and investors of federally-leased assets, the implications
are broad. Anecdotal inferences about whether a tenant is potentially
involved in the cybersecurity initiative may prove insufficient as
many agencies have been tasked with cyber responsibilities. For
example, the Small Business Administration (SBA) and Federal
Trade Commission (FTC) are both critical to the protection of various
financial industry sectors, a fact perhaps not immediately intuitive.
Nevertheless, many agencies will grow in
correspondence to the size of the threat they
protect and occupancy behavior should be
tracked by owners and investors accordingly.
Moreover, although naturally headquartered in
Washington, DC, the cybersecurity response
is a national threat and most of the agencies
identified throughout this report have offices
across the entire country. Owners should expect
that cyber growth will be nationwide though
with a disproportionate amount occurring in the
Washington metro.
CYBER THREATS
BY INDUSTRY
N
NEWS
CYBER THREATS FACED:
PHISHING, ZERO-DAY
ATTACKS AND DATA BREACHES
Assigned agency support:
Federal Communications Commission (FCC)
Federal Trade Commission (FTC)
RETAIL
CYBER THREATS FACED:
OPEN WIFI, POINT-OF-SALE
COMPROMISE AND DATA BREACH
Assigned agency support:
Federal Bureau of Investigation (FBI)
US Secret Service (USSS)
Consumer Products Safety Commission (CPSC)
BANKS
CYBER THREATS FACED:
DENIAL-OF-SERVICE, FRAUD, BOTNETS
AND WEB AUTHENTICATION ATTACKS
Assigned agency support:
US Secret Service (USSS)
Department of Treasury
Office of the Comptroller of the Currency (OCC)
Securities and Exchange Commission (SEC)
Consumer Financial Protection Bureau (CFPB)
HOSPITALITY
CYBER THREATS FACED:
POINT-OF-SALE COMPROMISE
(CREDIT CARDS), OPEN WIFI AND
ADMIN ACCOUNTS
Assigned agency support:
US Secret Service (USSS)
WEBSITES
CYBER THREATS FACED:
MALICIOUS CODE INJECTION AND EXCLUSION
FROM CORE SECURITY
Assigned agency support:
National Programs and Protectorate Directorate (NPPD)
Department of Homeland Security (DHS)
Federal Communications Commission (FCC)
DEFENSE/
INDUSTRIAL SECTOR
CYBER THREATS FACED:
ZERO-DAY HACKS, REMOTE ACCESS AND
PHISHING
Assigned agency support:
Department of Defense (DoD)
National Protection and Programs Directorate (NPPD)
CREDIT CARD PROCESSING
CYBER THREATS FACED:
PHISHING AND EGRESS TRAFFIC
AND DATA BREACH
Assigned agency support:
Internal Revenue Service (IRS)
Consumer Product Safety Commission (CSPC)
Department of Treasury
Federal Bureau of Investigation (FBI)
US Secret Service (USSS)
SMALL MEDIUM
BUSINESSES
CYBER THREATS FACED:
CREDIT CARDS, PHISHING,
POINT-OF-SALE COMPROMISE
Assigned agency support:
Federal Bureau of Investigation (FBI)
Small Business Administration (SBA)
Department of Treasury
CYBER: IMMUNE FROM REDUCTION?
Although agencies have been directed
to freeze, and subsequently reduce, the
footprint of their leased portfolio, new
responsibilities related to cybersecurity
may make it difficult to do so. As agencies
seek to implement new policies and
regulations in accordance with cyber
initiatives, new hires may make space
reduction no longer feasible as the
Government fits more personnel into the
same amount of leased space. Although
many of these hires may not cause net
new expansion, investors may see less
reduction than anticipated as agencies
implement cyber mandates.
4 5
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
8. COMPREHENSIVE NATIONAL
CYBERSECURITY INITIATIVE
Declassified in 2010, the Comprehensive National
Cybersecurity Initiative (CNCI) was launched in January
of 2008 to protect government computer systems and
begin to address the protection of private sector cyber
systems. CNCI covers a range of programs—from
research and development and promoting cyber
education to the first complex federal effort to develop
deterrence strategies in cyberspace. Some of CNCI
remains classified, such as detailed descriptions of the
government’s cyber offense capabilities. Additionally,
the declassification of CNCI was the first federal public
disclosure of the role of the National Security Agency in
one monitoring program—three years before the Edward
Snowden leaks. CNCI laid the foundation for most cyber
related federal expansion in 2009 and beyond.
2008
EXECUTIVE ORDER: IMPROVING
CRITICAL INFRASTRUCTURE
CYBERSECURITY
This 2013 Executive Order solidified the Department
of Homeland Security (DHS) as the primary shepherd
of civilian-focused cybersecurity operations for the
federal government. While the Department of Defense
had undergone over a decade of aggressive cyber
expansion, organizing and expanding the civilian side of
federal cyber was still in its infancy—and it now had a face:
DHS. The Improving Critical Infrastructure Cybersecurity
Executive Order aimed to promote and incentivize the
adoption of cybersecurity practices across all Executive
Branch agencies. The Executive Order directed agency
heads to work with DHS to share information regarding
cyberthreats and security. Simultaneous to releasing
the above Executive Order, the Obama Administration
released a 2013 Presidential Policy Directive (PPD) titled
“Critical Infrastructure Security and Resilience” designed to
strengthen the physical and cyber resilience of the nation’s
critical infrastructure.
2013
NATIONAL CYBERSECURITY
PROTECTION ACT
The most significant harbinger of bipartisan support for
federal cyber expansion, this 2014 Act was passed in the
Democratic controlled Senate and then, within the same
week, was passed unanimously in a Republican controlled
House. The Act was heralded as the most significant
cyber bill to pass Congress in over a decade. The main
aim of the Act was to codify the existing cybersecurity
and communications operations center at DHS, known
as the National Cybersecurity and Communications
Integration Center (NCCIC). NCCIC provides a platform
for the government and private sector to share information
about cybersecurity threats, incident response and
technical assistance. The Act requires NCCIC to include
representatives of federal agencies, state and local
governments and private sector owners and operators
of critical information systems. The Act also delegates
implementation authority for defense-related and
intelligence-related information security to the Secretary
of Defense and the Director of National Intelligence,
respectively.2014
DHS CYBERSECURITY WORKFORCE
RECRUITMENT AND RETENTION ACT
The DHS Cybersecurity Workforce Recruitment and
Retention Act focuses on strengthening the federal
government’s cybersecurity workforce. The bill aims at
improving hiring procedures and compensation ranges
for cybersecurity positions at DHS. Under the provisions
of the bill, DHS is required to pay cybersecurity workers
salaries similar to those of the cybersecurity positions
in the Defense Department. The bill also requires DHS
to file annual reports on its recruitment and retention
of cybersecurity workers. The bill (and its sister bill, the
Cybersecurity Workforce Assessment Act) have been
passed by both the House and the Senate and await
the President’s signature. The latter bill would require DHS
to conduct an assessment of its cybersecurity workforce
every three years, in addition to developing a strategy for
enhancing the recruitment and training of cybersecurity
employees. Both bills would boost DHS’ ability to
competitively hire cybersecurity professionals, a possible
boon for DHS’ future leased space needs.
2014
apitol Hill has been aware of the importance
of protecting America’s military and domestic
technology infrastructure for some time but the
focus has sharpened and gained momentum
since the beginning of this decade. This legislative
history of cybersecurity is described on the next
page, but the most compelling aspect of the set of policy initiatives
is the level of funding commitment represented. In an era when
both Republicans and Democrats are seeking to minimize federal
spending at home and abroad. The resources allocated, on a
bipartisan basis, to fighting cyber threats provide evidence of real
and enduring financial commitment.
PROPOSED
LEGISLATIVE
IMPACT ON
REAL ESTATE
C
2009 2010 20 11 2012 2013 20142008
AGENCYCREATEDAGENCYCREATED
RECRUITMENTPRIORITIZEDDHSPUTINCHARGE
6 7
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
9. GOVERNMENTCYBER
Overview
PROTECT
THE MILITARY
In 2013, the Office of the
Director of National Intelligence
(ODNI) named “cyberthreats” as
number one on the International
Strategic Threat List. This
is the first time in 10 years
something else was listed as
more threatening to the security
of the United States than
terrorism. Cybersecurity remains
the top priority as over half
of the Federal Government’s
cyber spending is devoted to
military-related cyber priorities.
Whether focused on detecting
threats within internal networks
or disrupting the U.S.’s
enemies’ ability to use their
own network and infrastructure,
the Department of Defense
has invested heavily in its
cyberspace operations.
MILITARY
COLLECTION
DISSEMENATION
Tasked as the primary
coordinator of the cyber
activities between the
intelligence, law enforcement
and military agencies, the
intelligence community’s
cyber program is continuously
evolving. To keep up with
the latest iteration of the
threats facing the nation,
the intelligence community
has shifted from a focus on
internal cybersecurity and
control of its own network
infrastructure, toward a focus
on cyber-offensive capabilities.
This comes at a time when
the government’s priorities
are shifting away from wars in
Iraq and Afghanistan towards
data collection and defensive
espionage. Thus, digital spying
is extremely important.
INTELLIGENCE
PROTECT
THE CIVILIANS
Until 2009, the federal
government did not have
a domestic interagency,
coordinated cyber plan.
Therefore, each individual
agency was forced to formulate
its own cyber budget, priorities
and best practices. DHS and
the FBI have been delegated by
the Administration as primary
coordinators for non-military – i.e.
“civilian” federal government
cyber initiatives. Both agencies
are seeking to streamline the
way the federal government
protects itself from cyber
threats --with varying degrees
of success. The civilian third of
the federal government’s cyber
strategy is, comparatively, still in
its infancy so goals and priorities
are constantly evolving making
the status more difficult to track.
CIVILIAN
IN THE WORLD OF GOVERNMENT, CYBER FALLS INTO THREE CATEGORIES: MILITARY,
INTELLIGENCE AND CIVILIAN. IN THE FOLLOWING SECTION, WE DESCRIBE THE VARIOUS WAYS
THESE SECTORS DEAL WITH CYBERSECURITY AND CYBERTHREATS.
8 9
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
10. epartment of Defense response to cybersecurity
has its origins in BRAC Legislation. Under DoD’s
latest Base Realignment and Closure Act, DoD
sought to organize and consolidate real property
according to mission. Several military bases were
designated as receiver bases for Information
and Cyber Technology – for example, Maryland’s Fort Meade. To that
end, DoD policy on cybersecurity represents a continuation of the
changes initiated under BRAC. Bases with components responsible
for defending against cyber threats and focused on intelligence
gathering will continue to experience growth, and land and office
vacancy located at or near these bases will have the opportunity to
capture lease demand as federally-owned bases struggle to catch
facility infrastructure up with the growth.
MILITARY: BUILDING
A CYBER ARMY
D
CYBER AND THE MILITARY:
DEPARTMENT OF DEFENSE’S CYBER STRATEGY
DOD CYBER: SECURE AND
SPECIALIZED WORKSPACE
USCYBERCOM stands as one of
the few government operations in
recent years that have significantly
increased their workforce size
and subsequent need for housing
increased personnel. Unlike many
civilian government agencies,
the nature of DoD’s cyber mission
necessitates highly secure and
specialized workspaces that are
not subject to the same teleworking
initiatives and pressures as the rest
of the federal government.
BRAC-RELATED CYBER CONSOLIDATION TO FORT MEADE WILL
RESULT IN NEW OPPORTUNITIES
CHINA
Steals intellectual property
(IP) from global businesses to
benefit Chinese companies and
undercut U.S. competitiveness
RUSSIA
Stealthy in their cyber tradecraft
and their intentions are
sometimes difficult to discern
STATE-SPONSORED
CRIMINAL ACTORS
Patriotic entities often act as
cyber surrogates for states, and
non-state entities can provide
cover for state-based operators
SOPHISTICATED
ADVERSARIES
INDEPENDENT
CRIMINAL ACTORS
Considerable threat in
cyberspace, particularly to
financial institutions, and
ideological groups often use
hackers to further their
political objectives
ISIS/ISIL
Recruit fighters and
disseminate propaganda and
have declared their intent
to acquire disruptive and
destructive cyber capabilities.
NORTH KOREA
Overt level of hostel threat,
though less sophisticated
than North Korea.
LESS-DEVELOPED
ADVERSARIES
ISIS/ISIL
WHO ARE WE FIGHTING?
10 11
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
684
New military jobs
2,915
New civilian jobs
1,764
New contractor positions
62,000
Total cyber related positions
at Fort Meade targeted
11. n an increasingly connected world,
counterintelligence plays a critical role in
enhancing the cybersecurity posture of the
United States, as counterintelligence is used to
create barriers to entry in an otherwise readily
accessible and vulnerable area. The nature of
the information that the intelligence community collects and
stores means that it is consistently the target of cyber-attacks
from a variety of enemies, both organized or decentralized,
requiring an increasingly cyber-aware intelligence community
workforce and specialized infrastructure.
The 2008 Comprehensive National Cybersecurity Initiative created
the foundation for a government-wide approach to protecting the
nation from cybersecurity threats. As part of it, the National Cyber
Investigative Joint Task Force (NCIJTF) was established under
Presidential Directive as the steward of the country’s national
cybersecurity initiatives.
The NCIJTF joins together 19 intelligence (including the National
Security Agency (NSA) and DHS), law enforcement and military
agencies to coordinate cyber threat investigations. The principle
behind NCIJTF is simple: notification of an intrusion to one agency
will be notification to all.
In addition to NCIJTF, several new intelligence
agency groups have been formed over the
past several months and years to address the
growing need for cybersecurity focus within the
government. These groups include the CIA’s
Directorate of Digital Innovation and the Cyber
Threat Intelligence Integration Center (CTIIC).
Just as the NCIJTF is the guiding force behind
the government’s cyber initiatives, the DNI is the
unifying agency that marries the intelligence
community together - and in turn houses
several Cyber Intelligence Task Forces that focus
the communities’ cyber efforts.
Nearly every intelligence agency already
contains, or will soon develop, a group that
is solely focused on cybersecurity, or in the
intelligence community - cyberespionage.
INTELLIGENCE:
CYBERESPIONAGEIN
THE21STCENTURY
I
THE IMPACTS OF CYBER ON THE
INTELLIGENCE COMMUNITY
CYBER INTELLIGENCE AGENCY MAP
CYBERESPIONAGE:
GROWTH TIED TO BLACK FIBER
The stage is set for major growth
in the sector of cyberespionage -
with both hiring a new generation
of intelligence analysts that
are educated in the field of
cybersecurity and providing net-
new infrastructure and secure
space for this mission which,
until now, has been limited to
Northern Virginia, along the
established secure government
“black fiber” network.
12 13
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
12. ost of the domestic and civilian cyber capabilities
of the Federal Government focus on defensive
and investigatory cyber tasks. While military
cyber spending is focused under the Department
of Defense, the civilian arm of the U.S. cyber
network is much harder to understand and map
out, as many agencies have taken on various cyber oriented roles
as cyber defenses have evolved over time. Over the past couple
of decades, there have been two agencies that have emerged as
the main stakeholders in the Federal Government’s civilian fight to
defend the homeland from cyberthreats.
It’s easy to understand why the Federal Bureau of Investigation
(FBI) has become a key part of the Government’s defensive cyber
response force. Much like with the notorious gangsters and
organized crime of the early 20th century and the rise of espionage
and sabotage from World War II through the Cold War, the 21st
century has brought on an entirely new set of criminal challenges
with emerging digital technologies. As the nation’s principal law
enforcement agency, the FBI has evolved to combat emerging
cybercrimes from nation-states, terrorist organizations and
transnational and domestic criminal enterprises.
The Department of Homeland Security is
responsible for coordinating the overall federal
effort to protect the security and resilience
of the nation’s critical physical infrastructure
(nuclear reactors, dams, hospitals, railroads,
etc). As part of that responsibility, DHS also
supports critical infrastructure owners and
operators in preparing for and protecting
against cyber incidents. From 2009-2014,
DHS prevented $10 billion in potential losses
through cybercrime investigations and
arrested more than 5,000 individuals for their
participation in cybercrime activities. There
are many DHS components that have active
cyber functions—most notably the U.S. Secret
Service (USSS), National Protection and
Programs Directorate (NPPD).
CIVILIAN:DEFENDINGTHEHOMELAND
M
DHS FBI: LAW ENFORCEMENT MEETS CYBER
HISTORY
In the FY2015 “CRomibus” federal spending bill, GSA was allocated $35
million for designing and beginning development preparations for a
new federally-owned campus that will “house federal employees and
contractors dedicated to the civilian cybersecurity mission.” This earmark
was the first mention of the civilian cyber campus in federal law. Since then,
the civilian cyber campus has been a topic highly discussed in the media
and is surrounded by intense speculation and confusing misinformation.
MISSION
Much of the confusion regarding the campus stems from defining
“civilian cybersecurity” itself. It is important to note that the campus will
be designed to house civilian agencies and private sector contractors.
While there will undoubtedly be some critical mission overlapping with
the Defense Department, it is very likely the civilian cyber campus will
remain a wholly separate entity from the military’s US Cyber Command
activities in and around Fort Meade, Maryland. The Department of
Homeland Security (DHS) and the Department of Justice (DoJ) have
been tasked with coordinating the creation of the civilian cyber campus.
Specifically, the National Protection and Programs Directorate (NPPD;
for DHS) and the Federal Bureau of Investigation (FBI; for DoJ) will be the
two agencies around which the civilian cyber campus will be designed.
Two other agencies—the Office of Intelligence Analysis (IA) on behalf
of the Intelligence Community and the US Secret Service (a division
of DHS)—will also be deeply involved with the evolving civilian cyber
mission moving forward.
IMPACT
Additional confusion surrounds exactly which agencies would
be involved in the consolidation—and which leases are at risk for
consolidation? Currently there are a number of agencies that accept
cyberattack reports from the general public and private sector. The
FBI’s Internet Crime Complaint Center is the main general repository
for general public reporting. The Secret Service is often the first
agency to learn of large breaches at banks and companies. Once the
Secret Service receives a complaint, it disseminates its information
through the National Cybersecurity and Communications Integration
Center (DHS), Information Sharing and Analysis Centers (DHS),
Electronic Crime Task Forces (FBI) and additional agencies. Expect
each of these functions to consolidate onto the campus.
The potential impact of the Civilian Cyber Campus on the Washington
DC metro area is significant. As Northern Virginia, Southern Maryland
and the District of Columbia compete to become the home of the
campus, the potential for an increase in leasing velocity on land adjacent
to the campus could be extraordinary. As civilian agencies seek to
partner with the private sector and the campus itself reaches capacity,
expansion and overflow will become inevitable.
CIVILIAN CYBER CAMPUS
LONG TERM SPACE
NEEDS UNKNOWN
Similar to the St. Elizabeth’s
Campus and FBI Headquarters
consolidations, the mere idea
of a future consolidation plan
will affect GSA’s leasing policy
upon lease expiration for
future Civilian Cyber Campus
occupants. Owners and investors
should expect short term, “as-
is” extension (5 years or less)
requests, regardless of the
status of the actual scheduled
date of completion.
On the other hand, all jurisdictions stand to
experience vacancy as agencies consolidating
onto the campus leave current locations. For
example, NPPD, FBI and Secret Service are in
leases spread across Northern Virginia and the
District of Columbia – whether they maintain a
presence off of the campus or not, the chance of
reduction, if not 100% relocation is high.
GETTING THE FACTS STRAIGHT:
• The civilian cyber campus isexactly that: civilian. The DefenseDepartment will have littleinvolvement.
• The campus is envisioned to befederally owned.
• Four agencies are deeply involvedin the civilian cyber campus:
National Protection and ProgramsDirectorate (NPPD)
Federal Bureau of Investigation(FBI)
The Office of Intelligence Analysis (IA)
US Secret Service
• The current expected price tag ofthe campus is $540 million.
14 15
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
13. he federal government has spent almost $32
billion on cybersecurity-related expenditures in
the past 10 years. More importantly, the cyber
spending boom shows no sign of slowing, as
spending increased 281% from 2006 to 2014 (an
average of 22% annually). This historic growth
in cyber spending runs counter to the greater trend in federal
government spending that has led to a relatively modest increase of
4.2% annually over the same time period.
As the world becomes increasingly digitized, so has
the federal government, but individual agencies are
not spending on cybersecurity in similar ways. Each
agency’s funding over the past 10 years tells a unique
story - from the consistent upswing in spending
of healthcare-focused agencies like HHS or VA,
corresponding with new initiatives that have led these
agencies to increasingly deliver sensitive information
through online digital portals such as Healthcare.
gov, to the recent explosion of cyber expenditures
of a newly digitally focused Social Security
Administration’s mission dictating cyber strategy.
$31.6B FEDERAL AGENCY CYBER-
SECURITY SPENDING SINCE 2006
T
16 17
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
14. oD’s critical role in the nation’s response to cyber
terrorism makes it the heaviest cyber spender
within the federal government. Accounting for
almost half of the total spending of the last
decade, the DoD cyber budget increased 295%
from 2006 to 2014. Regionally, this spending has
mostly occurred in Northern Virginia, which is not surprising given the
amount of square footage the agency occupies in the region.
008’s Comprehensive
National Cybersecurity
Initiative (CNCI) solidified
DHS’ role in protecting
the homeland from
cyberterrorism, which
corresponds to a sharp increase in DHS
cyber spending. Northern Virginia and the
District of Columbia could see growth related
to DHS spending since the agency already
occupies significant square footage in both
markets. Moreover, as demonstrated by the
accompanying chart, DHS Cyber Security
Specialists command salaries at the highest
end of the federal pay scale and a hiring influx
of high earners in the region could have a
significant impact on the region’s economy.
DEPARTMENT OF DEFENSE DEPARTMENT OF HOMELAND SECURITY
D 2$16.0B
$3.3B
DEPARTMENT OF DEFENSE LEASED
LOCATIONS IN NORTHERN VIRGINIA
SPENT ON CYBERSECURITY SINCE 2006
SPENT ON CYBERSECURITY SINCE 2006
HOMELAND SECURITY AVERAGE SALARY BY POSITION
DHS POSITION SALARY LOW MID HIGH
Cyber Security Specialist $74,000 $110,000 $175,000
Medical Doctor $129,988 $152,792 $168,709
Nuclear Engineer $69,236 $82,918 $97,125
Intelligence Officer $70,064 $82,782 $96,285
US Air Marshall $44,000 $82,782 $96,285
Policy Analyst $87,000 $90,000 $93,000
Program Analyst $64,109 $76,515 $91,053
Mechanical Engineer $67,943 $77,057 $86,894
Coast Guard Officer $53,408 $68,000 $86,400
Security Specialist $51,841 $65,496 $82,295
IT Specialist $54,025 $65,727 $77,805
Chemist $49,797 $59,654 $72,326
Coast Guard Enlisted $37,604 $51,972 $66,340
Immigration Officer $34,000 $44,000 $54,800
Customs Specialist $31,000 $41,000 $50,000
Border Patrol Agent $39,000 $41,000 $46,000
Security Screener $34,049 $38,854 $44,304
Salary Source Data: indeed.com
18 19
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
15. HS’s cybersecurity spending has grown at
a steady pace over the past decade as the
healthcare market continues to mature.
However, the growth of the agency’s real estate
portfolio has remained flat. In its FY 2016 budget
request, HHS proposes a budget of $73 million
for its Cybersecurity Program, which represents a 44% increase
over FY 2015 levels. This increase could be a catalyst for renewed
HHS demand.
Growth related to this spending should occur in Suburban
Maryland –home for most of HHS’ leasehold interests, and
Woodlawn, MD – home of the Centers for Medicaid and Medicare
Services (CMS), and nationally as states engage in federal
healthcare mandates.
DEPARTMENT OF
HEALTH HUMAN SERVICES
H $2.4B
HHS CYBERSECURITY PROGRAM DIRECT SPENDING
oE will be responsible for securing some of the most
critical energy infrastructure across the country and
funding levels reflect that mandate. Whether or not
the safeguarding of these vulnerable assets causes
net new demand or growth is unclear. However,
unlike some of the agencies with limited geographic
concentrations (such as HHS, Commerce, and State) growth related to
DoE should be national given the agency’s portfolio. Secondary and tertiary
markets, especially, may benefit disproportionately.
DEPARTMENT OF ENERGY
D $1.8B
AS OF 2013 THE US HAD THE FOLLOWING POWER PLANTS:
SPENT ON CYBERSECURITY SINCE 2006
SPENT ON CYBERSECURITY SINCE 2006
20 21
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
1,101
Petroleum
518
Coal
1,476
Hydroelectric
63
Nuclear
1,725
Natural Gas
2,299
Other
Renewable
44
Other Gases
78
Other Energy
Sources
16. hile 2014’s cyber budget increase may be an outlier,
VA’s spending on cybersecurity still increased over
362% between 2006 and 2013. This consistent
spending growth mirrors HHS’s spending habits as
both agencies respond to growth in the healthcare
industry. Similar to DoE, VA’s growth may occur
nationally as regional VA Clinics and Veterans’ Benefit Offices increase
hires to protect electronic medical records, files and Veterans’
personal information.
DEPARTMENT OF VETERANS AFFAIRS
W $1.1B
NEW AND UNDER CONSTRUCTION
VA LEASED FACILITIES
APPROX LEASE SIZE SQUARE FOOTAGE
0 to 20,000
20,000 to 50,000
50,000 to 100,000
100,000 to 295,001
oS is one of the few agencies that has spent less
on cybersecurity in recent years. Nevertheless, DoS
continues to be one of the top 10 biggest federal
cyber spenders--even without taking into account
2008, a year in which DoS’ cyber spending levels
were beat only by DHS and DOD. Most of DoS’ growth
will occur in the District of Columbia, Northern Virginia and abroad.
DEPARTMENT OF STATE
D $1.1B
WASHINGTON, DC AREA DOS LEASED LOCATIONS
SPENT ON CYBERSECURITY SINCE 2006 SPENT ON CYBERSECURITY SINCE 2006
22 23
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
17. ommerce will be working to
coordinate federal response to
cyber-threats related to retail
and banking industries. Growth
related to Commerce would
be concentrated in the District
of Columbia and Suburban Maryland, home of the
National Institute of Standards and Technology
(NIST). NIST was called upon in via Executive
Order, to produce “The Cybersecurity Framework”.
Created through public-private collaboration, the
framework provides a voluntary and non-regulatory
set of standards, guidelines and practices to help
businesses address and manage cyber risk in a
cost-effective way. Creation and maintenance of
this network will be headquartered out of NIST’s
Gaithersburg office and growth related to it is
predicted to occur in that submarket.
ainly driven by FBI spending, the Justice
Department has spent almost a billion dollars
on cybersecurity in the past decade. Expect
this number to increase dramatically in the
coming years, as FBI ramps up its leadership
through the National Cyber Investigative Joint
Task Force (NCIJTF). Much of the cyber related growth will occur
outside of the already planned FBI Headquarters Consolidation.
FBI related cyber-growth should take place primarily in Northern
Virginia and nationally as FBI Field offices operationalize cyber
protection mandates.
DEPARTMENT OF JUSTICE
M $0.8B
FBI HEADQUARTERS CONSOLIDATION
PROPOSED SITES
FBI Plans to consolidate its headquarters into an
approximately 1.2 million-square-foot headquarters
in the Washington, DC region by 2021.
$0.6B
NIST ACTIVITIES TO MANAGE CYBERSECURITY RISK
FUNCTION UNIQUE
IDENTIFIER
FUNCTION
CATEGORY
(CATEGORY UNIQUE IDENTIFIER)
ID Identify
Asset Management (AM)
Business Environment (BE)
Goverance (GV)
Risk Assessment (RA)
Risk Management (RM)
PR Protect
Access Control (AC)
Asset Management (AT)
Data Security (DS)
Information Protection Process and
Procedures (IP)
Protective Technology (PT)
DE Detect
Anomalies and Events (AE)
Security Continuous Monitoring (CM)
Detection Processes (DP)
RS Respond
Communications (CO)
Analysis (AN)
Mitigation (MI)
Improvements (IM)
RC Recover
Recovering Planning (RP)
Improvements (IM)
Communications (CO)
DEPARTMENT
OF COMMERCE
C
SPENT ON CYBERSECURITY SINCE 2006
SPENT ON CYBERSECURITY SINCE 2006
24 25
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
18. oT will be responsible for protecting critical
national infrastructure from cyberattack as well
as mobilizing the response for protection of
air travel communication, including protecting
the communication and traffic routing of the
aviation industry through the Federal Aviation
Administration (FAA). As stewards of some of the nation’s most
critical infrastructure, DoT’s responsibilities and growth will
occur both nationally and locally, within the DC Metro area as
offices grow to respond to the challenge of defending the nation’s
transportation channels.
$0.5B
D
DEPARTMENT OF TRANSPORTATION
hile SSA, barely cracks the top ten list of agency
cyber spenders, recent changes to the agency’s
digital mission has triggered a relative explosion in
cyber related spending. The agency’s cyber spending
increased a whopping 4,136% from 2006 to 2014.
Growth related to SSA should be focused outside of
Baltimore in the Woodlawn submarket (where SSA is headquartered) as
well as nationally in local SSA offices.
SOCIAL SECURITY ADMINISTRATION
W $0.5B
SPENT ON CYBERSECURITY SINCE 2006 SPENT ON CYBERSECURITY SINCE 2006
26 27
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
19. s this report goes to print, the frequency of
cyberattacks only continues to increase. Within the
past few months several major cyber events have
made headlines across the country. Most notably,
a hack into the Office of Personnel Management
(OPM) exposed sensitive personal information of
more than 22 million people. This number represents about 7 percent
of the country’s population, which was around 320 million in 2014. The
information breach included the highly sensitive Standard Form 86
documents, which contain information on family members and close
friends. It is estimated that the federal government will have to spend
up to $350 million in identity protection services to protect the sensitive
information that was lost in the attack.
Department of Homeland Security Secretary Jeh Johnson deemed
the OPM breach a “wake-up call” and called for increased funding for
cybersecurity spending. He was quickly followed by multiple members of
Congress from both parties, who said they plan to investigate the OPM
breach and the Government’s cybersecurity readiness on the whole. The
Obama administration weighed in on the breach, as well, identifying the
attack as work of the Chinese Government.
With new attacks or attempted attacks surface everyday, cybersecurity
is no ephemeral trend contingent on the fickle fluctuations of media
focus or partisan politics. The cybersecurity movement is poised to be
a transformational moment in our regional and national economies.
As the Government continues to grow and refine the infrastructure of
the federal response, demand for office space will grow, new people
will move into the area and money will be spent across the Washington
Metropolitan Area and around the country. As the specifics play out, the
macro dynamics are already becoming evident. Based on the information
available now, GIS is making the following predictions regarding the
specific ways in which we believe cybersecurity will affect the federally-
leased commercial real estate market.
THERE WILL BE AN INCREASE IN GENERAL DEMAND
Metro area will see an increase in cyber related office space demand
as the number of cyber professionals in the area continues to grow.
Cybersecurity professionals tend to make over 19.8% more than a
standard IT professional, meaning the continued hiring of DC Metro
cyber professionals will have many other positive effects on the local
economy and CRE markets.
THE GOVERNMENT’S INITIAL STRATEGY RELATED
TO LEASING OFFICE SPACE RELATED TO
CYBERSECURITY WILL BE COBBLED TOGETHER
Growth will be piecemeal and occur at locations
already occupied by a cyber related agency
including branches of DHS, NPPD or FBI. The
need to respond quickly will override the desire to
consolidate and the arrival of the cybersecurity
leasing portfolio will resemble the creation of DHS
in the sense that it will be mostly reactive and occur
in fits and starts.
A BELLWETHER MOMENT OF CRITICAL
INFRASTRUCTURE FAILURE WILL GALVANIZE THE
GOVERNMENT INTO COMPREHENSIVE ACTION
REGARDING CYBERSECURITY
True growth in the federal cyber sector may arrive
as the result of a major threat to the nation’s critical
infrastructure. Heretofore, the average American
citizen has perhaps been inconvenienced by a
cyber hack but not threatened in a visceral way. An
attack on the country’s critical infrastructure—a
dam, a power plant—would make the threat real
to the average citizen. Congress would see public
opinion reflect support for an increase in funding
the fight against cyber attacks.
THE WORKFORCE RECRUITMENT AND RETENTION
ACT OF 2014 WILL BE A TRANSFORMATIONAL
PIECE OF LEGISLATION FOR THE WASHINGTON
REGIONAL ECONOMY
Similar to the migration of talent into the region
during the Stimulus Boom of 2008 through 2010,
if the Government prioritizes attracting top tech
talent through offering compensation packages
comparable to the private sector and, specifically
Silicon Valley, every sector of the DC metro
economy could be affected—from multi-housing to
retail to, most notably, commercial office.
FORECAST
A
DEFENSE RELATED GROWTH
The area around Ft Meade has already benefited dramatically from defense related
cyberspending. The Department of Defense, which has at least a decade’s head start on
civilian government cyber buildup, has more than doubled the population of Fort Meade
since 2005. Fort Meade, which was originally headquartered the National Security Agency
(NSA), became the home of the US Cyber Command in 2010. In 2005, the base housed
over 33,000 employees. Today, the base houses over 60,000—doubling the size of the
Pentagon. As a result, the population of Anne Arundel County grew by at least 25% over
the last two decades.
Most of the physical growth at Ft, Meade, expansion, has occurred off the base in buildings
adjacent to the base leased to DoD and NSA.
INTELLIGENCE RELATED GROWTH
Along Route 28, the Government has been building up intelligence related agencies for the
past decade. With the major relocation of the Office of the Director of National Intelligence
(ODNI) and easy access to historic intelligence assets in the area (NRO, CIA, etc;), Route 28 is
an ideal receiver for back office intelligence related cyber space growth.
Moreover, proximity to some of the most important tech firms in the world (Amazon, Google)
makes collocation very attractive to federal agency’s seeking expertise from companies
conversant in cyber-related matters. Continued interface with Silicon Valley will also increase
Route 28’s popularity among federal Cyber tenants given the submarket’s proximity to Dulles
International Airport. Federal and Private sector employees alike can conveniently commute
back and forth between the two Cyber epicenters as needed.
CIVILIAN CYBER GROWTH
Located adjacent to both Marine Base Quantico and National Geospatial-Intelligence Agency (NGA),
northern Stafford County will see a disproportionate amount of cyber related growth from civilian
agencies driven primarily by FBI, in particular. The spending has already spurned dark fiber installation in
the area, as well as fresh contractor relocations in surrounding office parks. While many of the planned
2,000+ new FBI cyber related agent and analyst hires will be spread out in regional offices across the
country, many contractors will seek space around the Quantico due to its relationship with FBI.
Moreover, the FBI growth related to cybersecurity will operate independently of the planned FBI
Headquarters consolidation out of the Hoover Building in downtown Washington, DC. As the FBI HQ
project continues in fits and starts, the agency’s cybersecurity mission must be agile and proactive
- and, most importantly, must find ways to expeditiously deploy the funding provided by Congress.
Leasing related to FBI cybersecurity will necessarily occur outside of the consolidation in order to
preserve speed-to-market efficiency. Cyberattacks affecting American citizens will not wait while
the FBI determines its housing plans.
POCKETS OF GROWTH ALONG FEDERAL INFRASTRUCTURE
The Government will slowly upgrade its cyber infrastructure across the country, creating spurts of
spending growth on an agency by agency basis in primary and secondary CRE markets over the next
decade. Additionally, look for new IT spending requirements in tertiary markets as agencies with
geographically driven mission-related offices receive funding to upgrade their systems.
For example: All FBI regional offices will receive funding to initiate cybercrimes task forces if they
have not done so already. Veterans Affairs clinics will designate increased spending allocations for
cybersecurity upgrades. Department of Energy offices located near critical energy infrastructure
components (damns, renewable energy farms, etc) beef up their security protocols and safeguard
measures. With each spending spurt, expect localized increases in federal real estate demand—
creating small, decentralized space demand hotspots across the country over the next decade.
FORTMEADEROUTE28STAFFORDCOUNTYNATIONAL
DEMAND WILL OCCUR IN SELECT MARKETS WITH PRE-EXISTING INFRASTRUCTURE AND/OR
ESTABLISHED FEDERAL DRIVERS WITH A RELATIONSHIP WITH CYBER RELATED TENANTS.
CYBERGROWTHREGIONSCYBERGROWTHREGIONS
28 29
|BACKGROUND|GOVERNMENTOVERVIEW|AGENCYSPENDING|FORECAST|
20. “It’s no surprise that
cybersecurity will be
architected out of the same
market where the Internet was
created...Northern Virginia”
HERB MANSINNE
Managing Director,
Brokerage
“In the span of a decade,
the government has
expended over $30 billion
and has hired thousands
of employees dedicated to
cyber, with consistent growth
predicted in the years to
come. However, it may take
a “Pearl Harbor” cyber event
to initiate the type of growth
that has an immediate
“needle moving” impact on
the real estate world.”
JOE BRENNAN
Managing Director,
Government Investor
Services
“Demand from cyber-related
firms seeking space in the
Metro area has significantly
increased over the past
12 months. Many of the
Silicon Valley-based firms
are seeking outposts in the
Metro area in order to work
on federal contracts related
to cybersecurity initiatives.
Firms are specifically focused
on the Toll Road market given
the proximity to Dulles, target
employee demographics and
visible signage opportunities”
JAY FARMER
Managing Director,
Brokerage
“The increase in
cybersecurity spending and
employment has fueled
record-setting multifamily
absorption in Washington,
DC. More than 14,000
apartment units were newly
occupied in the 12 months
ending June 2015 - an
all-time record and almost
double the annual average.”
CHRIS ESPENSHADE
Managing Director,
Capital Markets
“The typical cybersecurity
focused tenant uses
less space per person.
This is driven by the
utilization of benching
due to the necessity of
maintaining an open office
environment. However, the
lower physical build-out
costs are often offset by
increased infrastructure and
connectivity, i.e.,
soft requirements.”
CHRIS MOLIVADAS
Managing Director,
Project Development
Services
“In Prince William, Loudoun
and Fairfax Counties
enterprise data centers have
leased or purchased over
2.0M SF of conventional
warehouse space,
representing nearly 10% of
the industrial inventory in
those markets. The 2.0M SF
are done deals. This 2.0M
SF does not include the data
centers being built by DuPont
Fabros, Equinix, Digital Realty
Trust, Sabee and more. “
JOHN DETTLEFF
SVP, Brokerage
PERSPECTIVES ON THE BROADER CYBER
IMPACT FROM THE JLL INVESTOR SUITE
AGENCYLEASING
FEDERALCRE
CYBERIMPACTONTHECAPITALMARKETS
TENANTREPRESENTATION
MULTIFAMILY
DEVELOPMENT
INDUSTRIAL
he Capital Markets have
responded favorably to the riseof cybersecurity as a nationaldefense priority due to theopportunity to create andretain value. The investing and
lending communities have demonstrated that they
are beginning to place a premium on assets withcybersecurity-related tenants.
The reason behind this increase in confidence is
the certainty of renewal created by the specialized
nature of the properties and clear growth trajectory
in the sector. Federal cybersecurity spending has
increased 56.6% since 2011 despite an 11.6%decline in federal contract spending during thesame period. No other defense initiative hasclearer spending priority in the federal, state and
local budgets.
On top of the initial tenant improvement allowance,
cyber-related tenants create highly-specializedfacilities through additional capital investment inconnectivity to specific fiber lines, SCIF build-outs
and other infrastructure enhancements. Thesignificant capital expended through the firstseveral years of the lease indicates a long-termcommitment to the space due to the inability to
endure the downtime and significant investment
associated with a relocation. As a result, cyber-related leasing has received less scrutiny thanstandard federal leasing, for example, in one recent
lease, the GSA self-funded over $200 per squarefoot in tenant improvements.
Sophisticated buyers have begun to understandthat cyber-related tenants with shorter firm terms
may actually have higher renewal potentials thanother federal users in traditional office spaceunder longer term leases. Buyers are placing anincreased emphasis on the specialized nature ofcyber-related installations and are underwritinghigher renewal probabilities and capturing theadditional resulting value. As a result, cap ratesare being driven by a combination of the remaining
term and the specific agency and mission.
The bottom line: assets with cybersecurityrelated tenants are not commodity office space– the specialized nature of these facilities isan indication of tenant commitment to thestrategically located properties – all coalescingin a strong story and “hook” that increases buyer
interest, and ultimately asset value.
T
30 31
MARC RAMPULLAEVP, Capital MarketsGovernmentSolutions
BRIAN SAAL
VP, Capital Markets
GovernmentSolutions
21. This glossary1
is a collection of commonly-used cyber-related terms. It is meant as a
primer for understanding basic industry terminology. For the purposes of this list, terms
have been divided into either Offensive or Defensive connotations—although many of the
terms can apply to both characterizations.
We are providing this glossary to enable you to navigate this report as we explore the
complicated, often esoteric, world of cybersecurity.
1
Terms and definitions adapted from the National Initiative for Cybersecurity Careers and Studies.
CYBER GLOSSARY
ANTISPYWARE SOFTWARE –
A program that specializes in
detecting and blocking or removing
forms of spyware.
CLOUD COMPUTING –
An on-demand network of
“shared pool” computing resources.
COMPUTER NETWORK DEFENSE –
The actions taken to defend
against unauthorized activity within
computer networks.
CRITICAL INFRASTRUCTURE –
The systems and assets, whether
physical or virtual, so vital to society
that the incapacity or destruction of
such may have a debilitating impact on
the security, economy, public health or
safety, environment, or any combination
of these matters
CYBERSECURITY – Protecting
computers, mobile devices, tablets,
networks, programs and data from
unauthorized access or manipulation.
CYBERSPACE – The interdependent
network of information technology
infrastructures. Cyberspace includes
the Internet, telecommunications
networks, computer systems, and
embedded processors and controllers.
DARK FIBER NETWORK –
A privately operated network of optical
fiber cabling that is used for secure and
direct communication and data exchange
between facilities
DIGITAL FORENSICS –
Gathering, retaining and analyzing
system-related data (digital evidence)
for investigative purposes.
FIREWALL – A capability to limit network
traffic between information systems.
NETWORK RESILIENCE – The ability of
a network to:
1. Provide continuous operation.
2. Recover effectively if failure
does occur.
3. Scale to meet rapid or
unpredictable demands.
REDUNDANCY – Additional systems,
assets or processes that maintain a
degree of overall functionality in case
of loss or failure of another system.
SCIF – Sensitive Compartmented
Information Facility - an enclosed area
within a building that is used to process
classified information.
DEFENSIVECYBER
ATTACK (CYBERATTACK) – An attempt
to gain unauthorized access to system
services, resources, or information, or an
attempt to compromise system integrity.
There are 5 main attack types:
1. PHISHING – An attack designed
to deceive individuals into
providing sensitive information.
2. MALWARE – Software that
compromises the operation
of a system by performing an
unauthorized function or process.
3. TROJAN HORSE – A computer
program that appears to have a
useful function, but also has a
hidden and potentially malicious
function that evades security
mechanisms.
4. SPOOFING – Faking the sending
address of a transmission to gain
unauthorized entry into a
secure system.
5. DENIAL OF SERVICE –
An attack that prevents or impairs
the authorized use of resources or
services.
BOT – A computer connected to the
Internet that has been compromised
with malicious intent to perform activities
under remote control.
BOTNET – A collection of computers
compromised by malicious code and
controlled across a network.
CYBERTHREAT – The possibility of a
malicious attempt to damage or disrupt a
computer network or system.
DATA BREACH – The unauthorized
movement or disclosure of sensitive
information to a party that is not
authorized to have or see the information.
DATA MINING – The process or
techniques used to analyze large
sets of existing information to discover
previously unrevealed patterns
or correlations.
HACKER – An unauthorized user
who attempts to or gains access to an
information system.
KEYLOGGER – Software or hardware
that tracks keystrokes, usually secretly,
designed to be monitored by an
alternate user.
SPAM – The abuse of electronic
messaging systems to indiscriminately
send unsolicited bulk messages.
SPYWARE – Software that is secretly
installed into an information system
without the knowledge of the system
user or owner.
THEFT – The primary goal of hackers,
cyber-related theft typically is either:
1. IDENTITY THEFT
2. INTELLECTUAL PROPERTY
THEFT (i.e. patents, trademarks,
trade secrets and copyrights)
VIRUS – A computer program that can
replicate itself, infect a computer without
permission or knowledge of the user,
and then spread or propagate to another
computer.
ZERO-DAY ATTACKS – An attack
that exploits a previously unknown
vulnerability in a computer application or
operating system, one that developers
have not had time to address and patch.
OFFENSIVECYBER
32 33
