DoD Awards $40.9M for Guam Warehouse Construction to Hensel Phelps Construction Co
Contract Overview
Contract Amount: $40,896,459 ($40.9M)
Contractor: Hensel Phelps Construction CO
Awarding Agency: Department of Defense
Start Date: 2022-04-01
End Date: 2025-10-31
Contract Duration: 1,309 days
Daily Burn Rate: $31.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: FY22 MCON PROJECT P-326, PRINCIPAL END ITEM (PEI) WAREHOUSE, U.S. NAVAL SUPPORT ACTIVITY (NAVSUPPACT), MARINE CORPS BASE (MCB) GUAM
Place of Performance
Location: YIGO, GUAM County, GUAM, 96929
Plain-Language Summary
Department of Defense obligated $40.9 million to HENSEL PHELPS CONSTRUCTION CO for work described as: FY22 MCON PROJECT P-326, PRINCIPAL END ITEM (PEI) WAREHOUSE, U.S. NAVAL SUPPORT ACTIVITY (NAVSUPPACT), MARINE CORPS BASE (MCB) GUAM Key points: 1. Significant investment in critical infrastructure for Naval Support Activity Guam. 2. Hensel Phelps Construction Co. is a major player in large-scale construction projects. 3. Potential risks include project delays and cost overruns common in large construction. 4. Construction sector spending is robust, but specific project execution is key.
Value Assessment
Rating: good
The $40.9 million award for the PEI Warehouse appears competitive given the project's scale and complexity. Benchmarking against similar large-scale government construction contracts is necessary for a definitive assessment, but the firm-fixed-price structure suggests an effort to control costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating a robust price discovery process. This method allows multiple qualified contractors to bid, driving competitive pricing and potentially better value for the government.
Taxpayer Impact: The competitive bidding process for this significant infrastructure project aims to ensure taxpayer funds are used efficiently for essential military facilities.
Public Impact
Enhances logistical capabilities for the U.S. Navy in the Indo-Pacific region. Supports military readiness and operational effectiveness in Guam. Creates construction jobs and economic activity in Guam. Long-term asset for U.S. defense infrastructure.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for schedule delays due to remote location and complex logistics.
- Risk of unforeseen site conditions impacting cost and timeline.
- Dependence on a single large contractor for project completion.
Positive Signals
- Awarded under full and open competition.
- Firm-fixed-price contract helps control costs.
- Strategic importance of the facility for naval operations.
Sector Analysis
This project falls within the Commercial and Institutional Building Construction sector, a significant area of federal spending, particularly for defense infrastructure. Benchmarks for similar large-scale military construction projects are essential for evaluating cost-effectiveness.
Small Business Impact
The contract was awarded to Hensel Phelps Construction Co., a large prime contractor. There is no explicit indication of small business subcontracting participation in the provided data, which warrants further investigation to ensure opportunities for small businesses.
Oversight & Accountability
The Department of the Navy's oversight is crucial for managing this large-scale construction project, ensuring adherence to schedule, budget, and quality standards. Regular progress reports and site inspections will be key accountability mechanisms.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Geographic location challenges (Guam).
- Potential for unforeseen site conditions.
- Complexity of large-scale construction projects.
- Reliance on prime contractor's management.
Tags
commercial-and-institutional-building-co, department-of-defense, gu, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $40.9 million to HENSEL PHELPS CONSTRUCTION CO. FY22 MCON PROJECT P-326, PRINCIPAL END ITEM (PEI) WAREHOUSE, U.S. NAVAL SUPPORT ACTIVITY (NAVSUPPACT), MARINE CORPS BASE (MCB) GUAM
Who is the contractor on this award?
The obligated recipient is HENSEL PHELPS CONSTRUCTION CO.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $40.9 million.
What is the period of performance?
Start: 2022-04-01. End: 2025-10-31.
What is the projected cost per square foot for this warehouse compared to similar facilities?
Without detailed specifications like square footage and specific construction materials, a precise cost-per-square-foot benchmark is difficult. However, given the $40.9 million price tag for a principal end item warehouse on Guam, the cost per square foot would need to be carefully evaluated against regional construction costs and the specialized requirements of a military facility to ensure value.
What are the specific risks associated with construction in Guam for this project?
Construction in Guam presents unique risks including logistical challenges for material and equipment transport, potential for typhoons requiring specific building standards, limited local labor pool for specialized skills, and the environmental considerations of working on an island. These factors can impact both cost and project timelines, requiring robust mitigation strategies.
How effectively will this warehouse contribute to the Navy's operational readiness in the Indo-Pacific?
The Principal End Item (PEI) Warehouse is designed to enhance logistical capabilities by providing secure storage and efficient distribution of critical equipment. Its strategic location on Guam is vital for supporting naval operations in the Indo-Pacific, directly contributing to readiness by ensuring timely access to necessary materiel and reducing supply chain vulnerabilities.
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
Solicitation ID: N6274221R1313
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 841 BISHOP ST STE 2001, HONOLULU, HI, 96813
Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $40,896,459
Exercised Options: $40,896,459
Current Obligation: $40,896,459
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6274219D1332
IDV Type: IDC
Timeline
Start Date: 2022-04-01
Current End Date: 2025-10-31
Potential End Date: 2025-10-31 00:00:00
Last Modified: 2026-01-06
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