GSA awards $33.8M contract for building services at 26 Federal Plaza, raising value-for-money questions

Contract Overview

Contract Amount: $33,819,700 ($33.8M)

Contractor: Acquest Development Company, LLC

Awarding Agency: General Services Administration

Start Date: 2018-12-18

End Date: 2021-05-06

Contract Duration: 870 days

Daily Burn Rate: $38.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF GC SERVICES FOR THE MULTIPLE FLOOR PROJECT AT 26 FEDERAL PLAZA

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10278

State: New York Government Spending

Plain-Language Summary

General Services Administration obligated $33.8 million to ACQUEST DEVELOPMENT COMPANY, LLC for work described as: IGF::OT::IGF GC SERVICES FOR THE MULTIPLE FLOOR PROJECT AT 26 FEDERAL PLAZA Key points: 1. The contract's value appears high relative to its duration and scope, suggesting potential overspending. 2. Limited competition dynamics may have influenced the final price. 3. The contractor has a history of performance on similar federal projects. 4. The project's success hinges on effective project management and quality control. 5. This contract falls within the broader category of federal building construction and maintenance. 6. The fixed-price contract structure shifts some risk to the contractor.

Value Assessment

Rating: fair

The contract value of $33.8 million for 870 days of service appears to be on the higher end when compared to similar building maintenance and renovation contracts. While specific benchmarks for this exact scope are difficult to ascertain without more granular data, the per-diem cost is substantial. The firm fixed-price nature of the contract provides cost certainty but necessitates careful oversight to ensure value is delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while competition was sought, certain potential bidders may have been excluded. With only 4 bids received, the level of competition was moderate, potentially impacting price discovery and allowing the awarded contractor a stronger negotiating position.

Taxpayer Impact: A moderate level of competition means taxpayers may not have benefited from the lowest possible price achievable through broader market engagement.

Public Impact

Federal employees and visitors at 26 Federal Plaza will benefit from improved building services. The contract ensures the continued operation and maintenance of a significant federal facility. The geographic impact is localized to New York City. The contract supports jobs in the construction and building services sector in the New York area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs.
Risk of service quality issues if contractor performance is subpar.
Limited competition may have led to a higher-than-optimal price.

Positive Signals

Firm fixed-price contract provides cost certainty.
Contractor has experience with federal projects.
Definitive contract structure allows for defined task orders.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting market. Spending in this area is driven by the need to maintain and upgrade federal facilities. Comparable spending benchmarks are difficult to establish precisely due to the unique nature of each building's requirements, but large-scale renovations and maintenance contracts often run into the tens of millions.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. This means opportunities for small business participation may be limited unless the prime contractor voluntarily includes them in their subcontracting plans.

Oversight & Accountability

Oversight for this contract would typically fall under the General Services Administration's Public Buildings Service. Accountability measures are inherent in the firm fixed-price contract, with penalties for non-performance. Transparency is generally maintained through contract award databases, though detailed performance metrics may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud or significant mismanagement.

Related Government Programs

Federal Building Maintenance Contracts
Public Infrastructure Projects
Government Facility Renovations
Commercial Building Construction Services

Risk Flags

Potential for higher cost due to limited competition.
Contract value seems high relative to duration.
Need for robust performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $33.8 million to ACQUEST DEVELOPMENT COMPANY, LLC. IGF::OT::IGF GC SERVICES FOR THE MULTIPLE FLOOR PROJECT AT 26 FEDERAL PLAZA

Who is the contractor on this award?

The obligated recipient is ACQUEST DEVELOPMENT COMPANY, LLC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $33.8 million.

What is the period of performance?

Start: 2018-12-18. End: 2021-05-06.

What is the track record of Acquest Development Company, LLC on similar federal contracts?

Acquest Development Company, LLC has a history of performing federal contracts, primarily in the construction and facilities management space. While specific details on past performance metrics for this particular contractor require deeper investigation into contract databases and performance reports, their presence in the federal contracting arena suggests familiarity with government procurement processes and requirements. Analyzing past contract awards, completion timeliness, and any reported disputes or terminations would provide a clearer picture of their reliability and effectiveness in delivering services comparable to this $33.8 million contract.

How does the value of this contract compare to similar building services contracts awarded by the GSA?

Benchmarking this $33.8 million contract against similar GSA building services contracts requires detailed analysis of contract scope, duration, and specific services rendered. However, given the 870-day duration, the approximate daily rate is substantial. Without granular data on the specific services (e.g., HVAC maintenance, janitorial, minor repairs, major renovations), a direct comparison is challenging. Generally, contracts of this magnitude for building services indicate significant scope, potentially involving major upgrades or comprehensive facility management over an extended period. Further analysis would involve comparing cost per square foot or cost per service type against a portfolio of comparable GSA contracts.

What are the primary risks associated with this firm fixed-price contract?

The primary risks associated with this firm fixed-price contract, from the government's perspective, revolve around ensuring the contractor delivers the required quality and scope of services within the agreed-upon price. If the contractor underestimates costs or encounters unforeseen issues, they may be incentivized to cut corners on quality or scope, leading to subpar service delivery. Conversely, if the contractor significantly overestimates costs, the government may end up paying a premium. The government's risk is also tied to the contractor's financial stability and capacity to perform over the contract's duration. Robust oversight and clear performance metrics are crucial to mitigate these risks.

How effective is the 'Full and Open Competition After Exclusion of Sources' in ensuring competitive pricing?

The effectiveness of 'Full and Open Competition After Exclusion of Sources' in ensuring competitive pricing is inherently limited compared to true full and open competition. While it aims to solicit offers from all responsible sources, the exclusion clause suggests specific categories or types of sources were intentionally omitted, potentially narrowing the field of bidders. With only four bids received, this suggests the exclusion may have significantly reduced the number of potential offerors. This reduced competition can lead to less aggressive pricing, as the awarded contractor faces fewer direct competitors, potentially resulting in a higher price for the government than if a broader range of sources had been included.

What are the historical spending patterns for building services at 26 Federal Plaza?

Historical spending patterns for building services at 26 Federal Plaza prior to this $33.8 million contract would provide crucial context for assessing its value. Analyzing previous contracts for maintenance, repairs, and upgrades at this specific facility would reveal trends in spending, contract types, and contractor performance. If previous spending was significantly lower for comparable services, it could indicate an escalation in costs or an expansion of scope. Conversely, if spending has been consistently high, it might suggest the facility requires substantial ongoing investment. Without this historical data, it is difficult to determine if this current contract represents a typical expenditure or an anomaly.

What are the implications of the contract duration (870 days) on the overall value proposition?

The contract duration of 870 days (approximately 2.4 years) for $33.8 million suggests a significant, long-term commitment to building services at 26 Federal Plaza. A longer duration can offer benefits such as contractor stability, reduced administrative burden from frequent re-competition, and potential economies of scale if the contractor can optimize operations over time. However, it also locks the government into a specific provider and price for an extended period. The value proposition hinges on whether the services provided justify the cost over this duration and whether the fixed price remains competitive throughout the contract term. A shorter duration might allow for more frequent price adjustments based on market conditions.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 47PC03R0007

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 80 CURTWRIGHT DR, STE5, WILLIAMSVILLE, NY, 14221

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,819,700

Exercised Options: $33,819,700

Current Obligation: $33,819,700

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline