HUD's $56.5M Field Service Manager contract awarded to Innotion Enterprises, Inc. for property management services

Contract Overview

Contract Amount: $56,456,092 ($56.5M)

Contractor: Innotion Enterprises, Inc.

Awarding Agency: Department of Housing and Urban Development

Start Date: 2010-06-01

End Date: 2017-08-23

Contract Duration: 2,640 days

Daily Burn Rate: $21.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 19

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FIELD SERVICE MANAGER (FSM) M&M III-CONTRACT AREA 2P-2

Place of Performance

Location: GAITHERSBURG, MONTGOMERY County, MARYLAND, 20879

State: Maryland Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $56.5 million to INNOTION ENTERPRISES, INC. for work described as: FIELD SERVICE MANAGER (FSM) M&M III-CONTRACT AREA 2P-2 Key points: 1. The contract's value of $56.5 million over its period of performance suggests a significant investment in property management services. 2. Awarded under full and open competition, the contract indicates a market where multiple vendors could potentially compete. 3. The firm-fixed-price contract type aims to control costs by establishing a set price for services. 4. The contract duration of 2640 days (approximately 7.2 years) points to a long-term need for these services. 5. The North American Industry Classification System (NAICS) code 531311 for Residential Property Managers places this contract within a specific service sector. 6. The contract was awarded to a single entity, Innotion Enterprises, Inc., suggesting they were the most competitive bidder.

Value Assessment

Rating: fair

Benchmarking the value of this contract requires more granular data on the scope of services and the properties managed. However, a $56.5 million expenditure over more than seven years for property management services is substantial. Without comparable contracts for similar services and property portfolios, it is difficult to definitively assess value for money. The firm-fixed-price nature of the contract suggests an attempt to manage cost predictability, but the overall efficiency and effectiveness of the services rendered would be key to determining true 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 a bid. The presence of 19 bids suggests a healthy level of interest and competition for this contract. This broad competition is generally favorable for price discovery and ensuring the government receives competitive offers. The fact that Innotion Enterprises, Inc. was ultimately awarded the contract implies they presented the most advantageous offer among the numerous submissions.

Taxpayer Impact: A competitive bidding process like this one is beneficial for taxpayers as it typically drives down prices and encourages innovation among contractors, leading to better service delivery for the allocated funds.

Public Impact

The primary beneficiaries of this contract are likely residents of HUD-managed properties, who receive services related to property maintenance and management. The contract delivers essential property management services, ensuring the upkeep and operational efficiency of residential properties. The geographic impact is concentrated in Maryland (ST: MD, SN: MARYLAND), where the services are being performed. The contract supports a workforce involved in property management, maintenance, and administrative tasks related to residential real estate.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the firm-fixed-price contract does not adequately account for unforeseen property maintenance issues.
Risk of service quality degradation over the long contract duration if performance monitoring is not robust.
Dependence on a single contractor for an extended period could limit flexibility in adapting to changing property management needs.

Positive Signals

Awarded through full and open competition, indicating a competitive market and potentially favorable pricing.
Firm-fixed-price contract type provides cost certainty for the government.
Long contract duration suggests a stable and ongoing need for these critical property management services.

Sector Analysis

This contract falls within the broader real estate and property management sector. The market for residential property management services is substantial, driven by the need to maintain and operate housing units. Government contracts for such services are common, particularly for managing public housing or foreclosed properties. Benchmarks for similar contracts would typically consider the number of units managed, geographic location, and the specific services included (e.g., leasing, maintenance, tenant relations).

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (SS: false, SB: false). There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is not detailed, though large contracts can sometimes create opportunities for smaller firms to subcontract if the prime contractor engages them.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Housing and Urban Development (HUD) contracting officers and program managers. Accountability measures would be defined in the contract's performance work statement, with regular reporting and performance evaluations. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Public Housing Agency (PHA) Operations
Government Property Management Services
Residential Real Estate Services
HUD Multifamily Housing Programs
Federal Housing Administration (FHA) Asset Management

Risk Flags

Long contract duration may reduce flexibility.
Firm-fixed-price could lead to contractor complacency or quality issues if not monitored.
Potential for cost increases not fully captured in fixed price for unforeseen maintenance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $56.5 million to INNOTION ENTERPRISES, INC.. FIELD SERVICE MANAGER (FSM) M&M III-CONTRACT AREA 2P-2

Who is the contractor on this award?

The obligated recipient is INNOTION ENTERPRISES, INC..

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $56.5 million.

What is the period of performance?

Start: 2010-06-01. End: 2017-08-23.

What was the specific scope of services provided under the Field Service Manager (FSM) contract?

The contract, identified as 'FIELD SERVICE MANAGER (FSM) M&M III-CONTRACT AREA 2P-2,' was awarded to Innotion Enterprises, Inc. by the Department of Housing and Urban Development (HUD). While the exact scope of services is not detailed in the provided data, the NAICS code 531311 (Residential Property Managers) strongly suggests that the contract encompassed a range of property management activities. These typically include leasing, rent collection, tenant relations, property maintenance, repairs, inspections, and ensuring compliance with housing regulations. Given the contract's significant value ($56.5 million) and duration (over 7 years), it likely involved managing a substantial portfolio of residential properties, potentially including those owned or overseen by HUD, such as foreclosed properties or public housing units within a specific geographic area (Maryland).

How does the awarded amount of $56.5 million compare to similar federal property management contracts?

Comparing the $56.5 million award to similar federal property management contracts requires access to a broader dataset of contracts with comparable scopes, durations, and geographic coverage. However, as a general benchmark, federal property management contracts can range significantly. Contracts for managing large portfolios of residential units, especially those requiring extensive maintenance, compliance oversight, and tenant services, can easily reach tens of millions of dollars over several years. The firm-fixed-price nature of this contract suggests a defined budget for the services. To provide a precise comparison, one would need to analyze contracts with similar NAICS codes, agency types (e.g., other housing authorities, GSA), and service levels. Without such granular comparative data, it's challenging to definitively state if $56.5 million is high or low, but it indicates a substantial commitment for property management services.

What are the key performance indicators (KPIs) or metrics used to evaluate Innotion Enterprises, Inc.'s performance under this contract?

The provided data does not specify the key performance indicators (KPIs) or metrics used to evaluate Innotion Enterprises, Inc.'s performance. However, typical KPIs for residential property management contracts awarded by agencies like HUD often include metrics related to property condition, maintenance response times, tenant satisfaction, lease-up rates, eviction rates, financial reporting accuracy, and compliance with federal regulations. Performance evaluations would likely involve regular reviews by HUD contracting officers, site visits, and potentially tenant feedback mechanisms. The contract's firm-fixed-price structure implies that meeting defined service levels is crucial, and deviations could lead to contractual remedies or affect future contract awards.

What is the historical spending pattern for residential property management services by the Department of Housing and Urban Development?

The provided data focuses on a single contract award and does not offer historical spending patterns for residential property management services by HUD. To analyze historical spending, one would need to query federal procurement databases (like FPDS) for all contracts awarded under NAICS code 531311 (Residential Property Managers) or similar codes by HUD over several fiscal years. This analysis would reveal trends in contract values, number of awards, types of services procured, and the contractors most frequently engaged. Understanding historical spending provides context for the current contract's value and duration, highlighting whether this represents a typical investment or a significant deviation from past procurement practices for similar services.

What are the potential risks associated with a long-term (2640 days) firm-fixed-price contract for property management?

A long-term, firm-fixed-price contract for property management, like this 2640-day (approx. 7.2 years) award to Innotion Enterprises, Inc., carries several potential risks. For the contractor, the primary risk is underestimating costs for maintenance, repairs, or unforeseen property issues over the extended period, potentially leading to reduced profit margins or losses if fixed prices become inadequate. For the government (HUD), risks include the potential for the contractor to become complacent or reduce service quality to maintain profitability, especially if performance monitoring is not rigorous. There's also the risk that market rates for property management services could decrease significantly over the contract term, making the fixed price less competitive. Furthermore, a long-term commitment can reduce the government's flexibility to adapt to changing needs or adopt new property management technologies or strategies if the incumbent contractor is unwilling or unable to do so.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Activities Related to Real Estate › Residential Property Managers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 19

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 610 PROFESSIONAL DR STE 215, GAITHERSBURG, MD, 20879

Business Categories: Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Hispanic American Owned Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $56,456,092

Exercised Options: $56,456,092

Current Obligation: $56,456,092

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline