Department of State awards $2M firm-fixed-price contract for municipal building construction to Torres in Situ Sociedad Anonima

Contract Overview

Contract Amount: $2,017,239 ($2.0M)

Contractor: Torres in Situ Sociedad Anonima

Awarding Agency: Department of State

Start Date: 2024-08-06

End Date: 2025-12-17

Contract Duration: 498 days

Daily Burn Rate: $4.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: SOLOLA MUNICIPAL BUILDING CONSTRUCTION

Plain-Language Summary

Department of State obligated $2.0 million to TORRES IN SITU SOCIEDAD ANONIMA for work described as: SOLOLA MUNICIPAL BUILDING CONSTRUCTION Key points: 1. Contract awarded for construction services, indicating a need for facility development or renovation. 2. The firm-fixed-price structure shifts cost risk to the contractor, potentially leading to predictable expenses. 3. A definitive contract type suggests a clear scope of work and established terms. 4. The contract duration of 498 days points to a significant project timeline. 5. Awarded by the Department of State, likely for an overseas facility or embassy-related infrastructure.

Value Assessment

Rating: fair

The contract value of approximately $2.02 million for commercial and institutional building construction appears moderate for a federal project of this nature. Benchmarking against similar construction projects by the Department of State or other agencies would be necessary for a precise value-for-money assessment. However, the firm-fixed-price nature suggests that the government has negotiated a set price, which can be advantageous if the contractor accurately estimates costs. Without detailed project specifications and comparable bids, it's difficult to definitively assess if this price represents excellent value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. With three bidders participating, the competition level suggests a reasonable degree of market interest. This level of competition is generally favorable for price discovery and can help ensure that the government receives competitive pricing. The specific number of bidders (3) is a positive indicator, though a higher number would typically suggest even stronger price pressure.

Taxpayer Impact: Full and open competition with multiple bidders generally benefits taxpayers by driving down costs through market forces. This ensures that the government is not overpaying for services due to a lack of alternatives.

Public Impact

The primary beneficiaries are likely the Department of State personnel and operations that will utilize the constructed municipal building. Services delivered include the physical construction of a commercial or institutional building. The geographic impact is localized to the site of the construction, likely an overseas location given the agency. Workforce implications include job creation for construction workers and related trades during the project duration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or material price fluctuations occur, despite the fixed-price nature.
Ensuring timely completion within the 498-day timeframe is critical to avoid operational disruptions.
Quality control and adherence to construction standards will be paramount for the long-term usability of the facility.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition suggests a competitive bidding process, likely resulting in a fair price.
Award to a single contractor streamlines project management and accountability.

Sector Analysis

The contract falls within the Commercial and Institutional Building Construction sector, a broad category encompassing the erection of non-residential structures. This sector is characterized by a mix of large construction firms and specialized subcontractors. Federal spending in this area often supports infrastructure development, facility upgrades, and the construction of government buildings, including embassies and consulates abroad. The market size for federal construction is substantial, with significant annual outlays across various agencies.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information about subcontracting plans. The award to Torres in Situ Sociedad Anonima, a specific company, suggests it may be a larger entity or that subcontracting opportunities for small businesses are not explicitly detailed in the provided data. Further analysis would be needed to determine if small business participation is mandated or encouraged through subcontracting.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program office within the Department of State. Accountability measures are inherent in the firm-fixed-price contract, which holds the contractor responsible for delivering the specified work within the agreed-upon price. Transparency is generally facilitated through contract award databases, though detailed project oversight reports may not always be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of State Facilities Management
Overseas Building Operations
Federal Construction Contracts
Embassy and Consulate Construction

Risk Flags

Potential for cost escalation if unforeseen site conditions arise.
Risk of delays impacting project completion timeline.
Ensuring adherence to quality standards throughout the construction process.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $2.0 million to TORRES IN SITU SOCIEDAD ANONIMA. SOLOLA MUNICIPAL BUILDING CONSTRUCTION

Who is the contractor on this award?

The obligated recipient is TORRES IN SITU SOCIEDAD ANONIMA.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $2.0 million.

What is the period of performance?

Start: 2024-08-06. End: 2025-12-17.

What is the typical cost range for similar municipal building construction projects undertaken by the Department of State?

Determining the typical cost range for similar municipal building construction projects by the Department of State requires access to historical contract data and project specifications. Factors such as location (especially overseas), size, complexity, materials, and security requirements significantly influence costs. Projects can range from a few hundred thousand dollars for smaller renovations or annexes to tens or even hundreds of millions for major new embassy complexes. The $2.02 million award for this specific project suggests a moderate-sized undertaking, possibly a specific building within a larger complex or a standalone facility with defined functional requirements. Without more detailed project scope, direct comparisons are challenging, but this value is within the plausible range for specialized government construction abroad.

What is the track record of Torres in Situ Sociedad Anonima with federal contracts, particularly with the Department of State?

Information regarding the specific track record of Torres in Situ Sociedad Anonima with federal contracts, especially with the Department of State, is not detailed in the provided data. A comprehensive assessment would involve searching federal procurement databases (like SAM.gov or FPDS) for past awards, performance reviews, and any history of contract disputes or terminations. Companies that have successfully completed previous projects for the Department of State, particularly those involving construction in challenging overseas environments, would generally be considered lower risk. Understanding their past performance, including adherence to schedule, budget, and quality standards, is crucial for evaluating the reliability of this award.

How does the firm-fixed-price (FFP) contract type impact the risk profile for this construction project?

A firm-fixed-price (FFP) contract type places the majority of the cost risk on the contractor, Torres in Situ Sociedad Anonima. This means the contractor is obligated to complete the project for the agreed-upon price, regardless of their actual costs. This structure is beneficial for the Department of State as it provides cost certainty and predictability. However, it can incentivize contractors to cut corners on quality or use less expensive materials if not rigorously monitored. The government's risk is primarily related to ensuring the contractor's ability to perform and the quality of the final product, rather than cost overruns. For a construction project, potential risks for the contractor include unforeseen site conditions, labor cost increases, or material price volatility.

What are the potential implications of awarding a construction contract under 'full and open competition' with only three bidders?

Awarding a construction contract under 'full and open competition' with three bidders suggests a moderately competitive market for this specific project. While three bidders are better than one or two, a higher number typically indicates stronger price competition and a wider selection of potential contractors. The Department of State likely received proposals that were evaluated based on technical merit and price. The fact that three firms submitted bids means the government had options and could select the best value offer. However, it also raises questions about why more firms did not participate, which could be due to project complexity, location, specific requirements, or the contractor pool's size. This level of competition is generally positive for taxpayers but could potentially be improved with broader outreach or by breaking down larger projects.

What is the historical spending pattern of the Department of State on commercial and institutional building construction?

Historical spending patterns of the Department of State on commercial and institutional building construction are substantial, driven by the need to maintain and expand its global presence through embassies, consulates, and other facilities. Annual outlays can fluctuate significantly based on major construction initiatives, security upgrades, and geopolitical needs. The Department's Bureau of Overseas Buildings Operations (OBO) is a primary driver of such spending, managing the design, construction, and maintenance of U.S. diplomatic facilities worldwide. Analyzing past spending data would reveal trends in project types, average contract values, and the geographic distribution of construction investments, providing context for the $2.02 million award.

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: 19AQMM24R0014

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5TA CALLE 7-45 ZONA 14, GUATEMALA

Business Categories: Category Business, Foreign-Owned and U.S.-Incorporated Business, International Organization, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $2,017,239

Exercised Options: $2,017,239

Current Obligation: $2,017,239

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline