DoD's $39.5M Commissary Building Construction contract awarded to Hoar Construction, LLC

Contract Overview

Contract Amount: $39,535,128 ($39.5M)

Contractor: Hoar Construction, LLC

Awarding Agency: Department of Defense

Start Date: 2014-09-25

End Date: 2018-04-14

Contract Duration: 1,297 days

Daily Burn Rate: $30.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::CT::IGF COMMISSARY BUILDING CONSTRUCTION

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32212

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $39.5 million to HOAR CONSTRUCTION, LLC for work described as: IGF::CT::IGF COMMISSARY BUILDING CONSTRUCTION Key points: 1. Value for money appears fair given the firm-fixed-price structure, though detailed cost breakdowns are not publicly available. 2. Competition dynamics indicate a full and open process, suggesting a competitive bidding environment. 3. Risk indicators are moderate, with a firm-fixed-price contract generally transferring cost risk to the contractor. 4. Performance context is a large-scale construction project, requiring significant project management and execution capabilities. 5. Sector positioning places this contract within the Defense Commissary Agency's infrastructure development efforts.

Value Assessment

Rating: fair

The contract value of $39.5 million for a commissary building construction project is substantial. Benchmarking against similar large-scale construction projects within the Department of Defense or other federal agencies would be necessary for a precise value-for-money assessment. The firm-fixed-price contract type suggests that the contractor bears the primary risk for cost overruns, which can be a positive indicator for the government if the scope is well-defined. However, without detailed cost breakdowns or comparisons to industry standards for similar construction types and scales, a definitive assessment of pricing efficiency is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit bids. With 5 bids received, the competition level suggests a reasonably active market for this type of construction service. A higher number of bidders generally leads to more competitive pricing and a wider selection of qualified contractors. The fact that five bids were submitted implies that the solicitation was attractive and that the requirements were clear enough to elicit responses from multiple firms.

Taxpayer Impact: A full and open competition with multiple bidders is beneficial for taxpayers as it increases the likelihood of securing the best possible price and quality for the construction services. This competitive environment helps drive down costs and ensures that taxpayer funds are used efficiently.

Public Impact

Military personnel and their families stationed in Florida will benefit from an improved commissary facility. The project delivers essential infrastructure for the Defense Commissary Agency, supporting its mission to provide groceries to military members. The geographic impact is concentrated in Florida, specifically at the location where the commissary is being built. The construction project likely created temporary jobs for skilled trades and construction workers in the local Florida economy.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in large construction projects if not meticulously managed.
Reliance on a single prime contractor for a project of this magnitude carries inherent execution risks.
Construction projects are susceptible to unforeseen site conditions or material price fluctuations, even with fixed-price contracts.

Positive Signals

Firm-fixed-price contract structure transfers cost overrun risk to the contractor.
Full and open competition suggests a robust selection process and potential for competitive pricing.
Award to a known entity like Hoar Construction, LLC, may indicate a track record of successful project delivery.

Sector Analysis

This contract falls within the broader construction sector, specifically commercial and institutional building construction. The Defense Commissary Agency (DeCA) is responsible for operating commissaries worldwide, providing a valuable benefit to military members and their families. Large-scale construction and renovation projects are crucial for maintaining and modernizing these facilities to meet operational needs and enhance the shopping experience. Spending in this area is driven by infrastructure requirements, troop support, and the overall modernization efforts of military support agencies. Comparable spending benchmarks would involve analyzing other large federal building construction contracts, particularly those managed by agencies like the General Services Administration (GSA) or other branches of the Department of Defense.

Small Business Impact

The contract details indicate that small business participation was not a specific set-aside requirement, as 'sb' is false. There is no explicit mention of subcontracting goals for small businesses within the provided data. This suggests that the primary focus was on full and open competition among all eligible contractors, rather than specifically targeting small business participation. The impact on the small business ecosystem would depend on whether Hoar Construction, LLC, voluntarily engages small businesses as subcontractors for specialized services or materials, which is not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the Defense Commissary Agency's project management team. The firm-fixed-price nature of the contract implies that oversight would focus on adherence to the contract scope, schedule, and quality standards. Accountability measures are built into the contract terms, with potential penalties or remedies for non-performance. Transparency is generally facilitated through contract award databases like FPDS-NG, where basic contract information is made public. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse related to the contract arise.

Related Government Programs

Defense Commissary Agency Operations
Military Construction Projects
Federal Building Construction Contracts
Department of Defense Infrastructure

Risk Flags

Potential for cost overruns if initial estimates were inaccurate.
Risk of delays due to unforeseen site conditions or supply chain issues.
Ensuring adherence to quality standards throughout a long-term construction project.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $39.5 million to HOAR CONSTRUCTION, LLC. IGF::CT::IGF COMMISSARY BUILDING CONSTRUCTION

Who is the contractor on this award?

The obligated recipient is HOAR CONSTRUCTION, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Commissary Agency).

What is the total obligated amount?

The obligated amount is $39.5 million.

What is the period of performance?

Start: 2014-09-25. End: 2018-04-14.

What is the track record of Hoar Construction, LLC with federal contracts, particularly within the Department of Defense?

Hoar Construction, LLC has a history of engaging with federal agencies, including the Department of Defense. Analyzing their past performance on similar large-scale construction projects would provide insight into their reliability, project completion rates, and adherence to budget and schedule. Federal procurement data often includes past performance evaluations, which can be reviewed to assess their capabilities. For this specific contract, the duration of 1297 days (approximately 3.5 years) suggests a significant undertaking, and their successful completion of this project would be a key indicator of their federal contracting proficiency. Further investigation into their portfolio of completed DoD projects would reveal their experience with military construction standards and requirements.

How does the awarded price of $39.5 million compare to industry benchmarks for similar commissary construction projects?

Benchmarking the $39.5 million award against industry standards for commissary construction requires detailed project specifications, such as square footage, materials used, and specific amenities. Without these specifics, a direct comparison is difficult. However, large-scale commercial and institutional building projects of this nature can range significantly in cost per square foot. Factors like location (labor and material costs), complexity of design, and site preparation needs heavily influence the final price. To provide a robust comparison, one would need to identify similar DeCA projects or other federal commissary constructions, analyze their cost per square foot, and adjust for regional economic differences and project scope variations. The firm-fixed-price nature suggests the government sought cost certainty, but the initial bid competitiveness is key to ensuring value.

What are the primary risks associated with a firm-fixed-price contract for a project of this scale and duration?

The primary risks associated with a firm-fixed-price (FFP) contract for a large-scale, multi-year construction project like the IGF Commissary Building Construction involve potential contractor underestimation of costs, unforeseen site conditions, and scope creep. While FFP transfers cost overrun risk to the contractor, a poorly estimated bid could lead to contractor financial distress or a temptation to cut corners on quality to maintain profitability. Unforeseen subsurface conditions or material price escalations beyond what was reasonably anticipated can strain the contractor. Scope creep, where the government requests changes or additions beyond the original contract, can lead to disputes and change orders, potentially increasing the overall cost despite the FFP structure. Effective project management and clear contract definition are crucial to mitigate these risks.

How effective are the oversight mechanisms for ensuring the quality and timely completion of large federal construction projects?

Oversight mechanisms for large federal construction projects are typically multi-layered, involving contracting officers, project managers, quality assurance representatives, and potentially third-party inspectors. For a project like the IGF Commissary Building Construction, the Defense Commissary Agency would have designated personnel responsible for monitoring progress, ensuring compliance with design specifications, and verifying quality standards. The firm-fixed-price contract incentivizes the contractor to manage their own quality control to meet the agreed-upon specifications. Timely completion is monitored against the contract schedule, with provisions for liquidated damages if delays occur without valid justification. The effectiveness hinges on the diligence of the government oversight team and the contractor's commitment to meeting contractual obligations.

What is the historical spending pattern for commissary construction and renovation projects by the Defense Commissary Agency?

Historical spending patterns for commissary construction and renovation by the Defense Commissary Agency (DeCA) reflect ongoing efforts to modernize its global network of facilities. DeCA's budget typically includes allocations for capital construction, major renovations, and minor improvements to enhance the shopping experience and operational efficiency. Spending fluctuates based on infrastructure needs assessments, funding availability, and strategic priorities, such as consolidating facilities or upgrading technology. Analyzing multi-year spending data would reveal trends in the types of projects undertaken (e.g., new builds vs. renovations), average project costs, and geographic distribution of investments. This specific $39.5 million contract represents a significant investment in a single facility, indicative of the scale of projects DeCA undertakes to maintain its benefit delivery infrastructure.

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: HDEC0314R0003

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2 METROPLEX DR STE 400, BIRMINGHAM, AL, 35209

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

Financial Breakdown

Contract Ceiling: $39,535,128

Exercised Options: $39,535,128

Current Obligation: $39,535,128

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline