Gilbane Federal awarded $142.8M for Beale AFB aircraft hangar construction, a significant investment in critical infrastructure

Contract Overview

Contract Amount: $142,762,111 ($142.8M)

Contractor: Gilbane Federal

Awarding Agency: Department of Defense

Start Date: 2023-03-31

End Date: 2025-12-01

Contract Duration: 976 days

Daily Burn Rate: $146.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THE CONTRACTOR MUST CONSTRUCT A NEW MULTI-BAY AIRCRAFT HANGAR OF APPROXIMATELY 130,000 SQUARE FEET, SITED OVER THE CURRENT FOOTPRINT OF BUILDINGS 1043, 1042, 1004, AND 104 AT BEALE AIR FORCE BASE.

Place of Performance

Location: BEALE AFB, YUBA County, CALIFORNIA, 95903

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $142.8 million to GILBANE FEDERAL for work described as: THE CONTRACTOR MUST CONSTRUCT A NEW MULTI-BAY AIRCRAFT HANGAR OF APPROXIMATELY 130,000 SQUARE FEET, SITED OVER THE CURRENT FOOTPRINT OF BUILDINGS 1043, 1042, 1004, AND 104 AT BEALE AIR FORCE BASE. Key points: 1. The contract focuses on constructing a large, multi-bay aircraft hangar, indicating a need for enhanced operational capacity. 2. The project's firm-fixed-price nature suggests a defined scope and cost control measures. 3. Full and open competition was utilized, implying a robust bidding process and potential for competitive pricing. 4. The project is situated at Beale Air Force Base, highlighting its strategic importance for Air Force operations. 5. The duration of the contract (976 days) points to a complex and substantial construction undertaking. 6. The award value of $142.8 million represents a significant capital investment in military facilities.

Value Assessment

Rating: good

The contract value of $142.8 million for a 130,000 sq ft aircraft hangar appears to be within a reasonable range for large-scale military construction projects. Benchmarking against similar large hangar constructions would provide a more precise assessment, but the scale and complexity suggest a substantial investment. The firm-fixed-price contract type helps to manage cost certainty for the government.

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. The presence of two bidders suggests a competitive environment, though the exact number of proposals received and the evaluation process would offer further insight into the strength of the competition. This approach generally promotes price discovery and value for the government.

Taxpayer Impact: Full and open competition increases the likelihood of obtaining a fair market price for the construction services, benefiting taxpayers by ensuring the government is not overpaying for essential infrastructure.

Public Impact

The primary beneficiaries are the U.S. Air Force personnel and operations at Beale Air Force Base, who will gain access to a new, modern aircraft hangar. The service delivered is the construction of a large-scale, multi-bay aircraft hangar, essential for aircraft maintenance, storage, and readiness. The geographic impact is localized to Beale Air Force Base in California, enhancing its operational capabilities. Workforce implications include job creation in the construction sector, potentially benefiting local and regional labor markets during the project's duration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during construction, despite the fixed-price contract.
Delays in construction could impact operational readiness at Beale AFB.
Ensuring the quality of construction meets stringent military standards requires diligent oversight.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition suggests a competitive bidding process, likely leading to a fair price.
The project addresses a critical infrastructure need for the Air Force, enhancing operational capabilities.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on large-scale government facilities. The construction of military hangars is a specialized segment requiring adherence to strict specifications and security protocols. Comparable spending benchmarks for similar military construction projects would indicate that this award is substantial, reflecting the size and complexity of the facility being built.

Small Business Impact

The data indicates that small business participation was not a primary focus, as the contract was not set aside for small businesses and the contractor, Gilbane Federal, is a large entity. Subcontracting opportunities may arise, but the extent to which small businesses will be involved is not specified. Further analysis of subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this project will likely be managed by the Department of the Air Force, with potential involvement from the Defense Contract Management Agency (DCMA). Accountability measures are inherent in the firm-fixed-price contract, which penalizes the contractor for cost overruns. Transparency is generally maintained through contract award databases and reporting requirements, though specific project progress updates may be internal.

Related Government Programs

Military Construction (MILCON) Program
Air Force Facility Sustainment, Restoration, and Modernization (FSRM)
Department of Defense Infrastructure Projects
Large-Scale Commercial Building Construction

Risk Flags

Potential for schedule delays impacting operational readiness.
Risk of unforeseen site conditions impacting cost and schedule.
Ensuring adequate small business subcontracting opportunities.
Market concentration with limited bidders for specialized construction.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $142.8 million to GILBANE FEDERAL. THE CONTRACTOR MUST CONSTRUCT A NEW MULTI-BAY AIRCRAFT HANGAR OF APPROXIMATELY 130,000 SQUARE FEET, SITED OVER THE CURRENT FOOTPRINT OF BUILDINGS 1043, 1042, 1004, AND 104 AT BEALE AIR FORCE BASE.

Who is the contractor on this award?

The obligated recipient is GILBANE FEDERAL.

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 $142.8 million.

What is the period of performance?

Start: 2023-03-31. End: 2025-12-01.

What is Gilbane Federal's track record with large-scale military construction projects?

Gilbane Federal has a significant history of executing large-scale construction projects for the U.S. military, including barracks, training facilities, and operational infrastructure. Their experience often involves complex projects with stringent security and performance requirements. While specific details on past hangar construction projects would require deeper investigation, their general profile suggests they are well-equipped for this type of undertaking. Reviewing past performance evaluations and any past performance issues on similar contracts would provide a more granular understanding of their reliability and quality of work in this domain.

How does the cost per square foot for this hangar compare to similar military construction projects?

The contract value of approximately $142.8 million for a 130,000 square foot hangar equates to roughly $1,098 per square foot. Benchmarking this figure against similar military aircraft hangar constructions is crucial for assessing value. Factors such as specialized structural requirements, advanced climate control, fire suppression systems, and unique architectural needs for aircraft operations can significantly influence cost per square foot. Without direct comparisons to recently awarded, similarly complex hangars, it's difficult to definitively state if this represents excellent or fair value, though it appears substantial given the specialized nature of the facility.

What are the primary risks associated with constructing a large aircraft hangar on an active Air Force base?

Key risks include potential disruptions to ongoing base operations, stringent security protocols that can impact construction timelines and access, and the possibility of encountering unforeseen environmental or geological conditions at the site. Furthermore, coordinating with base personnel and ensuring the new facility integrates seamlessly with existing infrastructure are critical. The firm-fixed-price nature of the contract mitigates financial risk for the government regarding cost overruns, but schedule delays remain a significant concern that could impact mission readiness. Robust project management and communication plans are essential to mitigate these risks.

How effective are firm-fixed-price contracts in managing costs for complex construction projects like this?

Firm-fixed-price (FFP) contracts are generally effective in managing costs for construction projects when the scope of work is well-defined and risks are understood. They place the burden of cost overruns on the contractor, incentivizing efficiency and cost control. However, for highly complex projects with potential for unforeseen issues (e.g., ground conditions, material price volatility), FFP contracts can sometimes lead contractors to build in higher contingency costs, potentially increasing the initial price. Careful scope definition and robust contract administration are key to maximizing the benefits of FFP for complex builds.

What is the historical spending trend for aircraft hangar construction at Beale AFB or similar installations?

Historical spending data for aircraft hangar construction at Beale AFB or similar installations would provide valuable context for this $142.8 million award. Analyzing past projects of similar scale and complexity, including their award values, durations, and any cost adjustments, can reveal trends in construction costs, technological advancements, and evolving requirements. Understanding this historical spending pattern helps determine if the current award is consistent with past investments, potentially higher due to inflation or increased scope, or lower due to competitive pricing or efficiency gains.

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

While 'full and open competition' is the preferred method, having only two bidders might suggest limitations in the market for highly specialized large-scale construction or potential barriers to entry for other firms. It could indicate that the project's requirements are very specific, or that the number of qualified contractors capable of undertaking such a large and complex project is limited. While competition still exists, fewer bidders may reduce the downward pressure on price compared to a scenario with numerous competitive offers. Further analysis into why only two bids were received would be beneficial.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1655 GRANT ST 12TH FL, CONCORD, CA, 94520

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $142,762,111

Exercised Options: $142,762,111

Current Obligation: $142,762,111

Subaward Activity

Number of Subawards: 49

Total Subaward Amount: $84,977,026

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA890317D0041

IDV Type: IDC

Timeline