Department of Defense awards $5.24M contract for ACC renovation, highlighting commercial building construction needs

Contract Overview

Contract Amount: $5,240,210 ($5.2M)

Contractor: Acty CO., Ltd.

Awarding Agency: Department of Defense

Start Date: 2023-12-30

End Date: 2026-10-23

Contract Duration: 1,028 days

Daily Burn Rate: $5.1K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: PROJECT NO. ZNRE 23-1026 & 1049, ACC RENOVATION B1504 AND 1505

Plain-Language Summary

Department of Defense obligated $5.2 million to ACTY CO., LTD. for work described as: PROJECT NO. ZNRE 23-1026 & 1049, ACC RENOVATION B1504 AND 1505 Key points: 1. The contract value of $5.24 million appears reasonable for a significant renovation project of this scale. 2. Full and open competition suggests a healthy market for construction services, potentially leading to competitive pricing. 3. The project duration of 1028 days indicates a substantial undertaking requiring careful project management and oversight. 4. The firm-fixed-price contract type shifts performance risk to the contractor, ensuring cost certainty for the government. 5. This award falls within the broader category of commercial and institutional building construction, a vital sector for infrastructure. 6. The specific nature of ACC renovation suggests a focus on improving existing facilities rather than new construction.

Value Assessment

Rating: good

The contract value of approximately $5.24 million for the ACC renovation project seems aligned with typical costs for large-scale building improvements. Benchmarking against similar Department of Defense renovation projects would provide a more precise value-for-money assessment. However, given the scope implied by renovating two ACC buildings (B1504 and 1505), the price appears to be within a reasonable range, assuming standard construction complexities. The firm-fixed-price structure further supports cost predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified contractors had the opportunity to bid. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which is beneficial for price discovery and ensuring the government receives the best value. The availability of multiple bidders suggests a robust market for these types of construction services.

Taxpayer Impact: Full and open competition is favorable for taxpayers as it typically drives down prices through market forces, ensuring that government funds are used efficiently and effectively for necessary facility upgrades.

Public Impact

The primary beneficiaries are the personnel and operations supported by the renovated ACC facilities. The services delivered include comprehensive renovation of buildings B1504 and 1505, likely encompassing structural, electrical, plumbing, and aesthetic improvements. The geographic impact is localized to the specific Air Force base where these ACC buildings are located. Workforce implications include employment opportunities for construction workers, project managers, and related trades during the renovation period.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the scope of renovation makes it difficult to fully assess potential cost overruns or unforeseen issues.
The extended duration of 1028 days increases the potential for material cost fluctuations or delays impacting the overall project timeline.
Without knowing the specific condition of the existing buildings, it's challenging to gauge the full extent of the renovation required and associated risks.

Positive Signals

The use of a firm-fixed-price contract provides cost certainty and transfers risk to the contractor.
Awarding under full and open competition suggests a competitive bidding process that likely secured a fair market price.
The Department of the Air Force's involvement indicates established procurement processes and oversight for such projects.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the construction industry focused on non-residential structures. Spending in this sector is crucial for maintaining and upgrading government infrastructure, including military bases. Comparable spending benchmarks would involve analyzing the cost per square foot for similar renovation projects on federal facilities or large commercial buildings, considering factors like age, complexity, and location.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically mandated for small businesses through a set-aside. However, the prime contractor, ACTY CO., LTD., may still engage small businesses as subcontractors, depending on their own business practices and the availability of qualified small business firms for specific construction trades or services.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force contracting and project management offices. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to complete the work within the agreed-upon price. Transparency is facilitated through the federal procurement data system, where contract awards are reported. Inspector General jurisdiction may apply if any issues of fraud, waste, or abuse arise during the contract performance.

Related Government Programs

Military Base Infrastructure Modernization
Federal Building Renovations
Department of Defense Construction Projects
Air Force Facility Upgrades

Risk Flags

Potential for cost overruns due to extended project duration.
Risk of unforeseen site conditions impacting scope and budget.
Dependency on contractor's ability to manage a multi-year project effectively.
Need for robust oversight to ensure quality and adherence to schedule.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $5.2 million to ACTY CO., LTD.. PROJECT NO. ZNRE 23-1026 & 1049, ACC RENOVATION B1504 AND 1505

Who is the contractor on this award?

The obligated recipient is ACTY CO., LTD..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $5.2 million.

What is the period of performance?

Start: 2023-12-30. End: 2026-10-23.

What is the track record of ACTY CO., LTD. in performing similar large-scale government renovation projects?

Information regarding ACTY CO., LTD.'s specific track record on similar large-scale government renovation projects is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and any reported issues or successes on previous federal or commercial construction contracts. Understanding their experience with firm-fixed-price contracts and projects of comparable duration and complexity is crucial for evaluating their capability to successfully execute this ACC renovation.

How does the awarded amount of $5.24 million compare to the estimated cost or bids from other competitors?

The provided data does not include the estimated cost or the bid amounts from other competitors. While the award value of $5.24 million is presented, without comparative data, it is difficult to definitively assess if it represents optimal value. Full and open competition suggests that the government likely received competitive bids, and the awarded amount is presumed to be fair and reasonable based on market conditions at the time of award. Further analysis would require access to the bid tabulation and cost estimates.

What are the primary risks associated with a renovation project of this duration (1028 days)?

A renovation project spanning 1028 days (approximately 2.8 years) carries several inherent risks. These include potential cost escalation due to inflation in material and labor prices over the extended period, unforeseen site conditions (e.g., hazardous materials, structural issues) that may require scope changes and additional funding, delays caused by weather or supply chain disruptions, and the potential for contractor performance degradation over a long duration. The firm-fixed-price nature of this contract shifts much of the financial risk to the contractor, but schedule delays and quality issues remain potential concerns that require diligent oversight.

What specific improvements are included in the ACC renovation (B1504 and 1505)?

The provided data specifies the project as 'ACC RENOVATION B1504 AND 1505' but does not detail the specific improvements. Typically, ACC (Air Combat Command) renovations involve updating facilities to meet current operational, safety, and technological standards. This could encompass upgrades to HVAC systems, electrical and plumbing infrastructure, roofing, interior finishes, accessibility features, and potentially modernization of communication or IT infrastructure within the buildings. A detailed scope of work would be outlined in the contract's statement of work.

What is the historical spending pattern for building renovations by the Department of the Air Force?

Historical spending patterns for building renovations by the Department of the Air Force are extensive, reflecting the vast infrastructure managed by the branch. The Air Force consistently invests in maintaining and upgrading its bases, which include administrative buildings, hangars, barracks, and specialized facilities like ACC centers. Annual spending can fluctuate based on budget allocations, infrastructure assessments, and modernization priorities. This $5.24 million award represents a single project within that broader historical context of ongoing facility management and improvement investments.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2000-14, MIYOSHI, NAKA-KU, OKAYAMA

Business Categories: Category Business, Foreign Owned, International Organization, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $5,240,210

Exercised Options: $5,240,210

Current Obligation: $5,240,210

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA520920D0015

IDV Type: IDC

Timeline