State Department's $22.9M lodging contract for FSI personnel shows fair value with a 57,661 benchmark

Contract Overview

Contract Amount: $22,949,231 ($22.9M)

Contractor: Worldwide Corporate Housing, L.P.

Awarding Agency: Department of State

Start Date: 2013-08-01

End Date: 2014-09-03

Contract Duration: 398 days

Daily Burn Rate: $57.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: LONG/SHORT TERM LODGING ACCOMMODATIONS FOR THE BASE YEAR BEGINNING AUGUST 1, 2013 FOR FOREIGN SERVICE PERSONNEL IN TRAINING AT FSI. IGF::OT::IGF

Place of Performance

Location: LOS ANGELES, LOS ANGELES County, CALIFORNIA, 90064

State: California Government Spending

Plain-Language Summary

Department of State obligated $22.9 million to WORLDWIDE CORPORATE HOUSING, L.P. for work described as: LONG/SHORT TERM LODGING ACCOMMODATIONS FOR THE BASE YEAR BEGINNING AUGUST 1, 2013 FOR FOREIGN SERVICE PERSONNEL IN TRAINING AT FSI. IGF::OT::IGF Key points: 1. The contract's price appears reasonable when benchmarked against similar per-diem rates. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract duration is relatively short, potentially limiting long-term price escalation risks. 4. Fixed-price contract type helps mitigate cost overrun risks for the government. 5. The service is critical for essential personnel training, ensuring operational continuity. 6. Spending is concentrated in a single award, indicating a focus on a specific provider.

Value Assessment

Rating: good

The contract's total value of $22.9 million for approximately 13 months of lodging services for Foreign Service Institute personnel appears to be within a reasonable range. The benchmark of $57,661 suggests that the negotiated price per unit or per service is competitive. Comparing this to typical per-diem rates for government travelers, especially in potentially high-cost training locations, indicates that the government likely secured a fair deal. The fixed-price nature of the contract further supports good value by locking in costs.

Cost Per Unit: $57,661 (benchmark)

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of a single award suggests that one offeror was deemed the most advantageous to the government. While the number of bidders isn't specified, the competitive process itself is a positive sign for price discovery and ensuring the government receives the best value.

Taxpayer Impact: Full and open competition generally leads to more competitive pricing, which benefits taxpayers by ensuring funds are used efficiently and not inflated due to limited options.

Public Impact

Foreign Service Institute personnel undergoing training benefit from secure and appropriate lodging. The contract supports the Department of State's mission to train diplomats and other foreign affairs professionals. Geographic impact is worldwide, catering to personnel training needs across various locations. Workforce implications are positive, as it ensures essential personnel have stable accommodations, facilitating continuous training and readiness.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases in subsequent contract years if not managed proactively.
Reliance on a single vendor could pose a risk if service quality degrades or availability becomes an issue.

Positive Signals

Fixed-price contract limits the government's exposure to cost overruns.
Full and open competition suggests a robust process for selecting the most cost-effective provider.
The contract directly supports critical training for government personnel, aligning with national interests.

Sector Analysis

The lodging industry is a significant sector supporting government operations, particularly for personnel requiring temporary accommodations during training or assignments. This contract falls within the broader hospitality and corporate housing market. Benchmarking against industry standards for corporate housing and long-term lodging is crucial for assessing value. The government's need for reliable, worldwide lodging for its personnel represents a consistent demand within this sector.

Small Business Impact

The provided data does not indicate any specific small business set-asides or subcontracting requirements for this contract. As a large contract awarded to a single entity, it's possible that larger corporations are better positioned to compete. Further analysis would be needed to determine if small businesses were involved in subcontracting opportunities or if the set-aside goals were met.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of State's contracting officers and program managers. The Inspector General's office may also conduct audits or investigations into the contract's performance and financial aspects. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics might not always be publicly detailed.

Related Government Programs

Government Lodging Services
Foreign Service Institute Training Programs
Worldwide Corporate Housing Contracts
Department of State Personnel Support

Risk Flags

Potential for vendor lock-in if performance is consistently good.
Geographic variability in lodging costs could impact overall value realization.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $22.9 million to WORLDWIDE CORPORATE HOUSING, L.P.. LONG/SHORT TERM LODGING ACCOMMODATIONS FOR THE BASE YEAR BEGINNING AUGUST 1, 2013 FOR FOREIGN SERVICE PERSONNEL IN TRAINING AT FSI. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is WORLDWIDE CORPORATE HOUSING, L.P..

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $22.9 million.

What is the period of performance?

Start: 2013-08-01. End: 2014-09-03.

What is the historical spending trend for lodging accommodations for FSI personnel?

Analyzing historical spending for lodging for FSI personnel requires access to detailed contract databases beyond this single award. However, general trends in government lodging spending often reflect fluctuations in training needs, personnel deployment, and prevailing market rates. Contracts for lodging are typically re-competed periodically, meaning spending can be distributed across different vendors over time. Without specific historical data for this particular service category or FSI's overall lodging budget, it's difficult to establish a precise trend. However, the consistent need for training implies a recurring expenditure in this area, subject to the economic factors influencing the hospitality sector.

How does the per-unit cost of this contract compare to other government lodging contracts for similar personnel?

The provided data includes a benchmark of $57,661, which likely represents a cost comparison point or a calculated value metric. To definitively compare this contract's per-unit cost to other government lodging contracts, one would need access to a broader dataset of similar contracts, specifying the type of personnel, location, duration, and service level. Factors such as geographic location significantly impact lodging costs; for instance, lodging in major metropolitan areas or high-cost-of-living regions will naturally be more expensive than in less developed areas. Assuming the benchmark is relevant and accounts for these variables, the $57,661 figure suggests a potentially competitive rate, but a direct comparison requires more granular data on comparable contracts.

What are the primary risks associated with this lodging contract, and how are they mitigated?

Primary risks associated with this lodging contract include potential service quality issues, unexpected price escalations if contract terms are not rigid, and vendor performance failures. Mitigation strategies are embedded within the contract structure and oversight. The 'firm fixed price' (FFP) contract type is a key mitigation tool, as it caps the government's financial liability and incentivizes the contractor to manage costs efficiently. Full and open competition helps ensure that the selected vendor is capable and offers competitive pricing. Furthermore, contract clauses likely include performance standards, reporting requirements, and remedies for non-performance, allowing the Department of State to address any issues that arise during the contract period.

What is the track record of Worldwide Corporate Housing, L.P. with the Department of State or similar federal agencies?

Assessing the track record of Worldwide Corporate Housing, L.P. requires a review of their past performance on federal contracts. This would typically involve examining past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), any documented disputes or claims, and the overall history of their awards and completions. Without direct access to these performance records, it's challenging to provide a specific assessment. However, being awarded a contract of this magnitude by the Department of State suggests a level of capability and reliability. Further due diligence would involve searching federal procurement databases for their contract history and performance reviews.

How does the duration of this contract (398 days) impact its overall value and risk profile?

The contract duration of 398 days (approximately 13 months) is relatively short-term. This impacts the overall value by providing flexibility; the government is not locked into potentially unfavorable long-term rates or service agreements. It also allows for periodic re-evaluation of market conditions and needs. From a risk perspective, a shorter duration reduces the exposure to long-term market volatility and potential contractor performance degradation over extended periods. However, it also means the government will need to undertake the procurement process again relatively soon, incurring associated administrative costs and potential disruptions if a new contract is not secured in a timely manner.

Industry Classification

NAICS: Accommodation and Food Services › Traveler Accommodation › Hotels (except Casino Hotels) and Motels

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: R&B Realty Group (UEI: 045544103)

Address: 2222 CORINTH AVE, LOS ANGELES, CA, 90

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

Financial Breakdown

Contract Ceiling: $22,949,231

Exercised Options: $22,949,231

Current Obligation: $22,949,231

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SAQMMA12D0108

IDV Type: IDC

Timeline