State Department awards $61M design-bid-build contract for Paris residential facility

Contract Overview

Contract Amount: $61,042,609 ($61.0M)

Contractor: Sicra ILE DE France

Awarding Agency: Department of State

Start Date: 2023-05-24

End Date: 2025-10-23

Contract Duration: 883 days

Daily Burn Rate: $69.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DESIGN BID BUILD CONSTRUCTION OF THE NEW RESIDENTIAL FACILITY (MSGR) IN PARIS, FRANCE

Plain-Language Summary

Department of State obligated $61.0 million to SICRA ILE DE FRANCE for work described as: DESIGN BID BUILD CONSTRUCTION OF THE NEW RESIDENTIAL FACILITY (MSGR) IN PARIS, FRANCE Key points: 1. Contract awarded via full and open competition, suggesting a robust market. 2. The firm-fixed-price structure shifts cost risk to the contractor. 3. Project duration of 883 days indicates a significant construction undertaking. 4. The contract is for a new residential facility in Paris, France. 5. The award value is substantial for a single construction project of this nature.

Value Assessment

Rating: good

The contract value of $61 million for a design-bid-build construction project is within a reasonable range for a facility of this type and location. Benchmarking against similar international construction projects by the State Department or other agencies would provide further context on value for money. The firm-fixed-price contract type generally aims for cost certainty, but the final cost can be influenced by unforeseen site conditions or material price fluctuations over the project's duration.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with four bidders participating. This indicates a healthy level of market interest and suggests that the government received multiple proposals, likely leading to competitive pricing. The presence of four bidders provides a good basis for price discovery and ensures that the award was made to the most advantageous offer.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that typically drives down costs and ensures the government receives fair market value for its investment.

Public Impact

The primary beneficiaries are U.S. diplomatic personnel and their families stationed in Paris, France, who will gain new residential facilities. The project will deliver a new residential building, contributing to the infrastructure supporting U.S. diplomatic missions abroad. The geographic impact is localized to Paris, France, enhancing the U.S. Embassy's operational capacity in the region. The construction will likely involve a significant workforce, including architects, engineers, construction workers, and project managers, potentially benefiting local French labor markets.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during construction.
Delays in project completion could impact the availability of housing for personnel.
Fluctuations in material costs or labor availability in France could affect the contractor's profitability and project timeline.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition with four bidders suggests a competitive award.
The project addresses a clear need for residential facilities for diplomatic staff.
The contractor, SICRA ILE DE FRANCE, is likely experienced in large-scale construction projects in the region.

Sector Analysis

The construction sector, particularly for institutional and residential buildings, is a significant global industry. This contract falls within the commercial and institutional building construction NAICS code (236220). The market for such projects, especially for government facilities abroad, is often specialized, requiring contractors with experience in international projects, security protocols, and specific building standards. The award value is substantial, indicating a project of considerable scale and complexity.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside. There is no information provided regarding subcontracting plans or their impact on small businesses. Without specific set-aside requirements or reporting on subcontracting, the direct impact on the small business ecosystem is unclear, though large prime contractors often utilize small businesses for specialized services.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of State's Bureau of Overseas Buildings Operations (OBO) or a similar entity responsible for managing construction projects abroad. Accountability measures are embedded in the firm-fixed-price contract, which holds the contractor responsible for delivering the project within the agreed-upon price. Transparency is generally maintained through contract award notices and potential public reporting on project milestones, though detailed oversight reports may not be publicly available.

Related Government Programs

U.S. Embassy Construction Projects
Overseas Residential Facility Construction
Department of State Capital Security Construction Program
International Construction Contracts

Risk Flags

Potential for cost escalation due to long project duration.
Risk of delays impacting personnel housing availability.
Geopolitical or security risks in the host country.
Contractor performance and quality control.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $61.0 million to SICRA ILE DE FRANCE. DESIGN BID BUILD CONSTRUCTION OF THE NEW RESIDENTIAL FACILITY (MSGR) IN PARIS, FRANCE

Who is the contractor on this award?

The obligated recipient is SICRA ILE DE FRANCE.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $61.0 million.

What is the period of performance?

Start: 2023-05-24. End: 2025-10-23.

What is the track record of SICRA ILE DE FRANCE in completing similar government construction projects, particularly overseas?

Information regarding SICRA ILE DE FRANCE's specific track record with U.S. government overseas construction projects is not detailed in the provided data. However, as a contractor awarded a significant firm-fixed-price contract for a residential facility in Paris, it is presumed they possess the necessary experience and qualifications for such undertakings. Further investigation into their past performance, client references, and history with similar projects, especially those involving diplomatic missions or international clients, would be necessary for a comprehensive assessment. Reviewing past performance evaluations from federal agencies, if available, would provide valuable insights into their reliability, quality of work, and adherence to schedules and budgets on comparable contracts.

How does the awarded value of $61 million compare to the estimated cost or benchmark for similar residential facilities for diplomatic personnel in major European capitals?

Benchmarking the $61 million award against similar projects requires access to detailed cost data for comparable facilities in major European capitals. Factors such as size, amenities, specific security requirements, local construction costs, and prevailing market rates significantly influence project costs. While the award appears substantial, it may be justified by the complexity, security needs, and location in Paris. A thorough value analysis would involve comparing the cost per square foot, the scope of work, and the duration against projects of similar scale and purpose undertaken by the State Department or other governments in comparable cities. Without specific comparative data, it is difficult to definitively assess if this represents excellent or fair value.

What are the primary risk indicators associated with this specific contract, and how are they being mitigated?

Key risk indicators for this contract include potential cost overruns due to unforeseen site conditions or material price volatility, given the firm-fixed-price nature and the project's duration (883 days). Delays in construction could also pose a risk, impacting the availability of housing for personnel. Mitigation strategies likely include robust contract clauses, contingency planning by the contractor, and diligent project oversight by the Department of State. The selection of an experienced contractor through full and open competition also serves as a risk mitigation factor, aiming to ensure the chosen firm has the capability to manage such a project effectively. Site investigations prior to award would have aimed to identify known geological or environmental risks.

What is the expected effectiveness of the new residential facility in supporting the mission of the U.S. Embassy in Paris?

The effectiveness of the new residential facility is expected to be high, as it directly addresses the need for adequate and secure housing for U.S. diplomatic personnel and their families in Paris. Reliable and comfortable housing is crucial for staff morale, retention, and the overall operational efficiency of an embassy. By providing modern facilities, the project aims to enhance the quality of life for employees, potentially reducing turnover and improving productivity. This, in turn, supports the broader mission objectives by ensuring a stable and well-supported diplomatic presence in a key global capital.

How does historical spending on similar overseas construction projects by the Department of State compare to this award?

Historical spending patterns for similar overseas construction projects by the Department of State can vary widely based on project scope, location, and security requirements. Large-scale residential facilities in high-cost-of-living areas like Paris typically command significant investment. Without specific historical data for comparable projects, a direct comparison is challenging. However, the $61 million figure suggests a substantial investment, consistent with the need for secure, modern diplomatic infrastructure. The Department of State's Bureau of Overseas Buildings Operations (OBO) manages a portfolio of construction and renovation projects, and this award would be one component of their overall capital expenditure.

What are the implications of the 883-day duration on the project's overall cost and the contractor's resource allocation?

An 883-day duration (approximately 2.4 years) for a design-bid-build construction project of this magnitude implies a significant commitment of resources and a potentially complex build process. For the contractor, this extended timeline requires careful long-term resource planning, including labor, equipment, and materials management. It also increases the potential exposure to market fluctuations (e.g., material costs, labor rates) over the project's life, even under a fixed-price contract. For the government, the extended duration means a longer period before the facility is operational, potentially necessitating continued use of temporary or less adequate housing solutions. However, a longer duration can also allow for more thorough execution and quality control, potentially reducing long-term maintenance issues.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 19AQMM21R0001

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 83 RUE HENRI BARBUSSE, NANTERRE

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $61,042,609

Exercised Options: $61,042,609

Current Obligation: $61,042,609

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline