WASHINGTON—The Department of Homeland Security’s inspector general has launched a probe into the $38 billion warehouse-to-detention program championed by former Secretary Kristi Noem, according to a person familiar with the matter.
The department’s inspector general is expected to announce on Wednesday an “audit of ICE’s acquisition of detention space,” which will review all of the department’s warehouse purchases, a signature policy of Noem and her top adviser, Corey Lewandowski. The inspector general is already investigating the handling of contracts at DHS last year and political appointees involved in awarding them, The Wall Street Journal previously reported.
Noem and Lewandowski had argued that the government needed to buy its own detention centers rather than leasing them from private prison companies or local governments. Several of the warehouses—empty spaces more commonly purchased by Amazon or other large retailers—were intended to detain as many as 8,000 people at a time.
The government dedicated roughly $38 billion to the plan with money allotted by Congress through the One Big Beautiful Bill, a law passed by Republicans last summer that funded President Trump’s mass-deportation effort. So far, DHS has paid at least $1 billion for nine facilities, according to a Wall Street Journal review of property records, real-estate listings and statements from elected officials.
At Noem’s direction, U.S. Immigration and Customs Enforcement bought 11 vacant warehouses in the span of a couple of months this past winter. Noem and Lewandowski had been pressuring immigration officials to try to open the new detention centers by the end of the year, a tall order given that the properties weren’t zoned for detention and didn’t have working plumbing to support large detainee populations.
According to a report by CoStar, a real-estate analytics company, ICE paid between 11% and 13%, on average, above the price for comparable properties.
The purchases raised eyebrows among officials across the administration and in both parties on Capitol Hill, according to people familiar with the matter. Critics pointed out that ICE could have more rapidly expanded detention centers by purchasing unused public and private jail facilities, which would have already been properly configured.
When Homeland Security Secretary Markwayne Mullin, Noem’s replacement, took office, he immediately paused the warehouse plan.
A number of companies that had not previously worked in immigration detention received contracts related to the warehouse purchases.
For example, in March, ICE awarded a three-year contract worth more than $113 million to KVG LLC, a defense contractor with a history of supporting ships and ports for the U.S. Coast Guard, according to federal contracting data. The company hadn’t previously worked in immigrant detention.
Another company, SK2, hadn’t worked with the government until DHS awarded them a $6 million contract this January. The company was formed in Puerto Rico in June of 2024 by the CEO of government facilities contractor J&J Worldwide Services, according to corporate registries and LinkedIn. Real-estate group CBRE Group acquired J&J Worldwide Services in February of 2024. SK2 reincorporated in Tennessee in February shortly after winning the contract.
Representatives from SK2 and KVG declined to comment.
The Wall Street Journal identified four other firms that never received federal contracts before working with Homeland Security on the warehouses. Together, their contracts are worth up to $500 million.
In all, nearly 50 contractors, including KVG, SK2 and others approved by the government to acquire, renovate and provide logistical services related to warehouse detention centers were paid $1.7 billion since President Trump took office last January, according to a Journal analysis of government data.
Write to Tarini Parti at tarini.parti@wsj.com, Michelle Hackman at michelle.hackman@wsj.com and Shane Shifflett at shane.shifflett@dowjones.com
