VA's $215M contract for managing veteran-owned properties awarded to Vendor Resource Management, Inc

Contract Overview

Contract Amount: $215,512,122 ($215.5M)

Contractor: Vendor Resource Management, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2017-07-01

End Date: 2026-09-30

Contract Duration: 3,378 days

Daily Burn Rate: $63.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIXED PRICE INCENTIVE

Sector: Other

Official Description: IGF::OT::IGF THE DEPARTMENT OF VETERANS AFFAIRS LOAN GUARANTY SERVICE ADMINISTERS A HOME LOAN PROGRAM THAT PROMOTES HOME OWNERSHIP AMONG OUR NATIONS VETERANS AND ACTIVE DUTY PERSONNEL. THE PROGRAM PROVIDES FEDERAL HOME LOAN GUARANTEES ON RESIDENTIAL PROPERTY PURCHASED BY VETERANS AND SERVICE MEMBERS. AS A BYPRODUCT OF THE GUARANTEE PROGRAM, VA MAY BECOME THE HOLDER OF REAL ESTATE OWNED PROPERTIES AND PORTFOLIO LOANS. VA PROCURES A CONTRACTOR TO MANAGE THESE ASSETS.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20006

State: District of Columbia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $215.5 million to VENDOR RESOURCE MANAGEMENT, INC. for work described as: IGF::OT::IGF THE DEPARTMENT OF VETERANS AFFAIRS LOAN GUARANTY SERVICE ADMINISTERS A HOME LOAN PROGRAM THAT PROMOTES HOME OWNERSHIP AMONG OUR NATIONS VETERANS AND ACTIVE DUTY PERSONNEL. THE PROGRAM PROVIDES FEDERAL HOME LOAN GUARANTEES ON RESIDENTIAL PROPERTY PURCHASED BY VETERAN… Key points: 1. Contract aims to manage real estate owned (REO) properties and portfolio loans acquired by the VA through its home loan guarantee program. 2. The program's objective is to promote homeownership among veterans and active-duty personnel. 3. Vendor Resource Management, Inc. is the sole awardee for this definitive contract. 4. The contract has a fixed-price incentive pricing structure. 5. The contract duration is substantial, spanning over 3300 days. 6. This contract supports the VA's mission to provide benefits and services to veterans.

Value Assessment

Rating: good

The contract value of $215.5 million over its term represents a significant investment in managing VA-held properties. Benchmarking this against similar contracts for real estate asset management is challenging due to the specific nature of VA's REO portfolio. However, the fixed-price incentive structure suggests an effort to control costs while incentivizing performance. The long duration implies a need for consistent and reliable service delivery.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of four bidders suggests a competitive landscape for this type of service. The full and open nature of the competition is generally favorable for achieving competitive pricing and ensuring that the most capable vendor is selected.

Taxpayer Impact: Taxpayers benefit from a competitive process that is expected to yield a fair price for the services required to manage these properties efficiently.

Public Impact

Veterans and active-duty personnel benefit indirectly through the continued availability and administration of the VA's home loan guarantee program. The contract ensures the effective management of properties that the VA may acquire, thereby protecting federal assets. Services delivered include property management, maintenance, and disposition of REO properties and portfolio loans. The geographic impact is nationwide, as the VA's loan program and subsequent REO properties can be located anywhere in the United States. Workforce implications may include jobs in property management, real estate, and administrative support roles, both within the contractor's organization and potentially for local service providers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to potential complacency or reduced urgency if not actively managed.
Reliance on a single contractor for a significant period may limit flexibility to adapt to changing market conditions or VA needs.
The fixed-price incentive structure requires careful monitoring to ensure the incentives align with optimal outcomes for the VA and taxpayers.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
The contract's focus on managing VA-held properties directly supports the agency's mission to assist veterans.
The long-term nature of the contract provides stability for service delivery and contractor investment in processes.

Sector Analysis

The real estate asset management sector is diverse, encompassing property management, maintenance, and disposition services. This contract falls within the broader real estate services industry, specifically focusing on the management of government-acquired properties. Comparable spending benchmarks are difficult to establish without more granular data on the specific types and volumes of properties managed. However, the scale of this contract suggests it is a significant undertaking within the government contracting space for real estate services.

Small Business Impact

This contract was awarded under full and open competition and does not appear to have specific small business set-aside provisions. While the prime contractor is Vendor Resource Management, Inc., there may be opportunities for small businesses to participate as subcontractors for specific services such as property maintenance, repairs, or local real estate brokerage. The extent of small business subcontracting will depend on the prime contractor's strategy and the nature of the services required.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Veterans Affairs contracting officers and program managers. Accountability measures are likely embedded within the contract's performance standards and the fixed-price incentive structure. Transparency is generally maintained through contract award databases and reporting requirements, though specific operational details may be proprietary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

VA Home Loan Guaranty Program
Government Real Estate Management
Property Disposition Services
Federal Asset Management

Risk Flags

Long contract duration
Reliance on a single awardee
Potential for market shifts over contract term

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $215.5 million to VENDOR RESOURCE MANAGEMENT, INC.. IGF::OT::IGF THE DEPARTMENT OF VETERANS AFFAIRS LOAN GUARANTY SERVICE ADMINISTERS A HOME LOAN PROGRAM THAT PROMOTES HOME OWNERSHIP AMONG OUR NATIONS VETERANS AND ACTIVE DUTY PERSONNEL. THE PROGRAM PROVIDES FEDERAL HOME LOAN GUARANTEES ON RESIDENTIAL PROPERTY PURCHASED BY VETERANS AND SERVICE MEMBERS. AS A BYPRODUCT OF THE GUARANTEE PROGRAM, VA MAY BECOME THE HOLDER OF REAL ESTATE OWNED PROPERTIES AND PORTFOLIO LOANS. VA PROCURES A CONTRACTOR TO MANAGE THESE ASSETS.

Who is the contractor on this award?

The obligated recipient is VENDOR RESOURCE MANAGEMENT, INC..

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $215.5 million.

What is the period of performance?

Start: 2017-07-01. End: 2026-09-30.

What is the historical spending pattern for managing VA's REO properties?

Historical spending data for managing VA's Real Estate Owned (REO) properties prior to this contract is not directly available in the provided data. However, the significant value of this current contract ($215.5 million) suggests a substantial and ongoing need for these services. The VA's home loan program has been in place for decades, implying a long history of managing acquired properties. Understanding past spending would require analyzing previous contracts for similar services, potentially with different contractors or under different program structures. Trends in veteran homeownership rates, default rates, and property market conditions would likely influence historical spending levels. Without access to prior contract details, it's difficult to establish a precise historical spending pattern, but the current award indicates a sustained commitment to managing these assets.

How does Vendor Resource Management, Inc.'s track record compare for similar government contracts?

Information regarding Vendor Resource Management, Inc.'s specific track record for similar government contracts is not detailed in the provided data. To assess their suitability, a review of their past performance on contracts involving real estate asset management, property disposition, or loan portfolio management would be necessary. This would include examining past contract awards, performance evaluations, and any history of disputes or contract terminations. Their experience with the Department of Veterans Affairs or other federal agencies in managing government-owned or acquired properties would be particularly relevant. A comprehensive assessment would require accessing government contract databases and performance reports to gauge their capabilities and reliability in handling complex asset management tasks.

What are the key performance indicators (KPIs) for this contract?

The provided data does not explicitly list the Key Performance Indicators (KPIs) for this contract. However, given the nature of managing Real Estate Owned (REO) properties and portfolio loans, typical KPIs would likely include metrics related to property maintenance costs, time to sell properties, sale price achieved relative to market value or appraised value, tenant satisfaction (if applicable), and compliance with environmental and safety regulations. The fixed-price incentive structure suggests that specific performance targets are tied to financial incentives, implying that these KPIs are crucial for both contractor performance and taxpayer value. The VA would have established specific metrics to ensure efficient and cost-effective management of its assets.

What is the potential risk associated with the long duration of this contract?

The long duration of this contract (over 9 years) presents several potential risks. Firstly, it could lead to contractor complacency, where the vendor may become less motivated to innovate or optimize processes over time, assuming a guaranteed revenue stream. Secondly, market conditions for real estate and loan servicing can change significantly over such a long period. A contract structured for the initial market conditions might become suboptimal or inefficient as the market evolves. Thirdly, there's a risk of institutional knowledge loss within the VA regarding the contract's specifics if key personnel change frequently, potentially weakening oversight. Finally, a prolonged single-contractor relationship might stifle competition for future contracts, as other potential vendors may have less opportunity to gain relevant experience and demonstrate their capabilities.

How does the fixed-price incentive (FPI) structure aim to ensure value for money?

The Fixed-Price Incentive (FPI) contract structure is designed to ensure value for money by aligning the contractor's financial interests with the government's objectives. In an FPI contract, the final price is determined by the performance achieved against pre-defined targets. Typically, there is a target cost, a target profit, a price ceiling, and a sharing ratio between the government and the contractor for cost savings or overruns. For this contract, the VA likely established targets for property disposition timelines, sale prices, or maintenance costs. If Vendor Resource Management, Inc. performs better than the target (e.g., sells properties faster or at higher prices), they may earn a higher profit, up to the ceiling. Conversely, if costs exceed targets, the contractor absorbs a larger share of the overrun. This incentivizes the contractor to be efficient and cost-conscious, thereby promoting value for the taxpayer.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: VA119A-17-R-0010

Offers Received: 4

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Address: 4100 INTERNATIONAL PKWY STE 1000, CARROLLTON, TX, 75007

Business Categories: Black 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: $389,272,939

Exercised Options: $317,244,875

Current Obligation: $215,512,122

Actual Outlays: $38,359,535

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline