Watchdog probes Kristi Noem's $38B bet on Amazon-style ICE detention warehouses

WASHINGTON, DC: A major immigration initiative championed by former Homeland Security Secretary Kristi Noem is now under federal scrutiny, with an internal watchdog reportedly examining how billions of taxpayer dollars were committed under her leadership to rapidly expand immigration detention capacity.

The review, first reported by The Wall Street Journal on Wednesday, May 13, places fresh attention on Noem’s role in a controversial plan that aimed to transform empty industrial warehouse properties into large-scale detention centers for migrants, an ambitious project that moved quickly, cost heavily, and increasingly drew questions inside Washington.

Audit puts focus on decisions made under Kristi Noem

According to reports, the Department of Homeland Security Office of Inspector General has launched an audit connected to how US Immigration and Customs Enforcement acquired and converted detention space during Noem’s tenure.

While the review formally focuses on ICE’s property acquisition strategy, the political spotlight has fallen squarely on Noem and the senior officials who helped drive the project.

The detention expansion was reportedly one of Noem’s signature immigration initiatives during her time at DHS.

Rather than relying on private prisons or local correctional agreements, her team pushed for the federal government to directly purchase commercial warehouse sites and convert them into permanent detention facilities.

Working alongside political adviser Corey Lewandowski, Noem reportedly oversaw the acquisition of 11 warehouse properties in just a few months.

Billions approved and questions followed

The broader detention expansion was backed by funding from a Republican-backed immigration spending package that allocated tens of billions of dollars for detention infrastructure.

Though only a portion of the funding has reportedly been spent so far, the warehouse strategy itself was projected to cost as much as $38 billion if fully carried out.

Some of the purchased properties were originally designed as large distribution centers, buildings more commonly associated with companies like Amazon than federal detention operations.

Several of the sites were reportedly large enough to eventually house thousands of detainees at once.

But concerns soon began emerging over whether the government paid too much for the facilities.

Commercial real estate data from CoStar Group reportedly suggested ICE may have paid between 11% and 13% above market rates for comparable properties.

That sparked criticism from officials and lawmakers who argued existing correctional facilities could have been cheaper, faster, and easier to adapt.

Contractors and procurement under the lens

Beyond the property purchases, the watchdog review is also expected to examine contracting decisions tied to the project.

Reports indicate nearly 50 private firms secured contracts linked to the warehouse conversions, totaling roughly $1.7 billion since early 2025.

Several of those firms reportedly had limited experience in immigration detention work, while some had no prior federal contracting history before receiving major government deals.

Those details have intensified questions about how vendors were selected and what role political appointees may have played in the process.

After Noem left office earlier this year, her successor, Markwayne Mullin, reportedly paused further spending connected to the warehouse initiative while the department reviewed its detention strategy.