DoD Awards $123.5M for Hawaii Bachelor Enlisted Quarters Construction

Contract Overview

Contract Amount: $123,505,661 ($123.5M)

Contractor: NAN Inc

Awarding Agency: Department of Defense

Start Date: 2020-03-31

End Date: 2024-12-10

Contract Duration: 1,715 days

Daily Burn Rate: $72.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: N62742-20-C-1315, FY20 MCON P-911 BACHELOR ENLISTED QUARTERS MARINE CORPS BASE HAWAII, KANEOHE, HAWAII

Place of Performance

Location: M C B H KANEOHE BAY, HONOLULU County, HAWAII, 96863

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $123.5 million to NAN INC for work described as: N62742-20-C-1315, FY20 MCON P-911 BACHELOR ENLISTED QUARTERS MARINE CORPS BASE HAWAII, KANEOHE, HAWAII Key points: 1. Significant investment in military housing infrastructure at Marine Corps Base Hawaii. 2. Contract awarded via full and open competition, suggesting a competitive bidding process. 3. Potential for cost overruns or delays given the multi-year duration and large scale. 4. Construction sector is sensitive to material costs and labor availability.

Value Assessment

Rating: good

The contract value of $123.5 million for new multifamily housing construction appears substantial. Benchmarking against similar large-scale military housing projects would be necessary for a precise assessment, but the firm fixed-price nature offers some cost certainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely considered. This method generally promotes competitive pricing and ensures the government receives the best value.

Taxpayer Impact: Taxpayer funds are being utilized for essential military infrastructure, aiming to improve living conditions for service members. The competitive award process is intended to maximize the value of this investment.

Public Impact

Improved quality of life for enlisted Marines stationed in Hawaii. Supports military readiness by providing adequate housing. Potential economic stimulus for the local Hawaii economy through construction jobs and material sourcing. Long-term asset for the Department of the Navy and Marine Corps.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long project duration (over 4 years) increases risk of cost escalation.
Firm Fixed Price contract may not fully account for unforeseen material cost increases.
Geographic isolation of Hawaii can lead to higher logistics and material costs.

Positive Signals

Full and open competition suggests a robust bidding process.
Investment in critical military infrastructure.
Addresses a known need for improved enlisted housing.

Sector Analysis

This contract falls within the construction sector, specifically new multifamily housing. Large-scale government construction projects often face challenges related to material costs, labor availability, and project management, especially in remote locations like Hawaii.

Small Business Impact

While the contract was awarded under full and open competition, it's unclear if small businesses were involved as subcontractors. Large federal construction contracts can provide opportunities for small businesses through subcontracting, but direct awards to large prime contractors are common.

Oversight & Accountability

The Department of the Navy is responsible for oversight. Given the contract's duration and value, regular progress reviews, site inspections, and financial audits are crucial to ensure compliance and prevent waste.

Related Government Programs

New Multifamily Housing Construction (except For-Sale Builders)
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Long contract duration increases risk exposure.
Potential for cost escalation in the construction sector.
Geographic challenges impacting logistics and costs.
Reliance on a single prime contractor for a large project.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $123.5 million to NAN INC. N62742-20-C-1315, FY20 MCON P-911 BACHELOR ENLISTED QUARTERS MARINE CORPS BASE HAWAII, KANEOHE, HAWAII

Who is the contractor on this award?

The obligated recipient is NAN INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $123.5 million.

What is the period of performance?

Start: 2020-03-31. End: 2024-12-10.

What is the estimated cost per unit for the bachelor enlisted quarters?

The total contract value is $123.5 million. With 3 buildings (no), the average cost per building is approximately $41.17 million. Further details on the number of units per building are needed to calculate a precise per-unit cost. However, for large-scale military housing, costs can range significantly based on location, amenities, and construction complexity.

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

The main risk with a firm fixed-price contract for a project of this scale and duration is that the contractor assumes all cost overruns. If material prices, labor costs, or unforeseen site conditions escalate significantly beyond initial estimates, the contractor may face reduced profit margins or even losses, potentially impacting project quality or completion.

How does this investment align with the Marine Corps' long-term housing strategy in Hawaii?

This investment directly addresses the need for modern, adequate housing for enlisted personnel at Marine Corps Base Hawaii. Providing quality barracks is essential for recruitment, retention, and overall morale, supporting the base's operational readiness and the well-being of its service members.

Industry Classification

NAICS: Construction › Residential Building Construction › New Multifamily Housing Construction (except For-Sale Builders)

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: N6274220R1315

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 636 LAUMAKA ST, HONOLULU, HI, 96819

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $123,505,661

Exercised Options: $123,505,661

Current Obligation: $123,505,661

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline