DoD's $17.3M warehouse expansion contract awarded to foreign entities raises value and competition questions

Contract Overview

Contract Amount: $17,271,068 ($17.3M)

Contractor: Miscellaneous Foreign Awardees

Awarding Agency: Department of Defense

Start Date: 2010-09-16

End Date: 2014-03-29

Contract Duration: 1,290 days

Daily Burn Rate: $13.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 38

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DESIGN / BUILD WAREHOUSE EXPANSION

Plain-Language Summary

Department of Defense obligated $17.3 million to MISCELLANEOUS FOREIGN AWARDEES for work described as: DESIGN / BUILD WAREHOUSE EXPANSION Key points: 1. The contract's value appears high relative to the scope, with limited transparency on cost drivers. 2. Award to miscellaneous foreign entities suggests a lack of domestic competition or specialized capability. 3. The firm-fixed-price structure aims to control costs, but the overall price point warrants scrutiny. 4. Performance context is limited, making it difficult to assess the true value delivered. 5. This contract falls within the broader Defense sector's construction and facilities management spending. 6. The absence of small business involvement is noted, with no set-aside or subcontracting plans evident.

Value Assessment

Rating: questionable

The $17.3 million price tag for a warehouse expansion, awarded to 'Miscellaneous Foreign Awardees,' presents a significant value concern. Without detailed breakdowns of costs or comparisons to similar domestic projects, it's difficult to ascertain if this represents a fair market price. The lack of specific contractor information further complicates benchmarking. The firm-fixed-price nature of the contract suggests cost certainty, but the initial award amount itself appears substantial for the described service.

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 offers. However, the fact that the award went to 'Miscellaneous Foreign Awardees' suggests that either domestic firms did not bid, were unable to meet the requirements, or that foreign entities possessed a unique advantage. The number of bidders is not specified, which limits the assessment of competitive intensity.

Taxpayer Impact: While full and open competition theoretically promotes price discovery, the outcome here raises questions about whether taxpayers received the best possible value, especially if domestic capabilities were overlooked or unable to compete effectively.

Public Impact

The primary beneficiaries are the foreign entities awarded the contract, likely providing construction services. The contract delivers a physical asset: an expanded warehouse facility for the Department of Defense. The geographic impact is localized to the site of the warehouse expansion, likely within a DoD installation. Workforce implications would involve construction labor, potentially sourced internationally, impacting domestic job creation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Award to 'Miscellaneous Foreign Awardees' lacks transparency and makes performance assessment difficult.
The substantial contract value raises concerns about cost-effectiveness without clear justification.
Limited information on the competition process hinders understanding of price discovery and value.
Potential lack of domestic contractor involvement could represent a missed opportunity for U.S. businesses.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government.
Awarding under full and open competition theoretically allows for the widest range of potential bidders.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this area often supports infrastructure development and operational needs across various agencies. Benchmarking this specific contract is challenging due to the 'Miscellaneous Foreign Awardees' designation, but typical federal construction projects vary widely in cost depending on scale, complexity, and location.

Small Business Impact

There is no indication that this contract involved small business set-asides or subcontracting plans. The award to 'Miscellaneous Foreign Awardees' further suggests that small businesses, particularly domestic ones, were not primary participants in this specific procurement. This contract does not appear to contribute to the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's internal contracting and financial management oversight mechanisms. Inspector General investigations could be initiated if performance issues or suspected fraud arise. Transparency is limited by the vague contractor designation and the lack of detailed public reporting on project specifics.

Related Government Programs

Department of Defense Facilities Construction
Military Construction Projects
Warehouse and Logistics Infrastructure
Foreign Military Sales Support (indirectly)

Risk Flags

Lack of Contractor Specificity
Potential Value Concerns
Limited Competition Transparency
International Awardee Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.3 million to MISCELLANEOUS FOREIGN AWARDEES. DESIGN / BUILD WAREHOUSE EXPANSION

Who is the contractor on this award?

The obligated recipient is MISCELLANEOUS FOREIGN AWARDEES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $17.3 million.

What is the period of performance?

Start: 2010-09-16. End: 2014-03-29.

What specific services were rendered under this $17.3 million warehouse expansion contract?

The contract data indicates the primary purpose was 'DESIGN / BUILD WAREHOUSE EXPANSION.' This suggests the awarded entities were responsible for both the architectural and engineering design of the warehouse expansion, as well as the physical construction. This would encompass all activities from initial planning and blueprint creation through to the final build, including site preparation, foundation work, structural assembly, roofing, interior finishing, and potentially utility connections. However, without more granular details, the exact scope of 'design' and 'build' elements, and any specific inclusions or exclusions, remain unspecified in the provided data.

Why was this contract awarded to 'Miscellaneous Foreign Awardees' instead of domestic contractors?

The designation 'Miscellaneous Foreign Awardees' is highly unusual and lacks specificity, making it difficult to pinpoint the exact reason for this award. Potential explanations include: 1) The requirement involved highly specialized design or construction techniques not readily available domestically. 2) The project was located in a foreign country where local contractors were mandated or preferred, and these entities were the successful bidders. 3) There was a lack of competitive bids from qualified domestic firms for reasons unknown. 4) The term might be a placeholder or categorization issue within the federal procurement database, obscuring the actual contractor's identity and location. Further investigation into the specific solicitation and award details would be necessary to clarify this.

How does the $17.3 million cost compare to similar warehouse expansion projects?

Benchmarking this $17.3 million contract is challenging due to the limited information, particularly the 'Miscellaneous Foreign Awardees' designation and the lack of specific project scope beyond 'warehouse expansion.' Generally, the cost per square foot for commercial warehouse construction can range significantly, from $50 to $200 or more, depending on factors like location, materials, specialized features (e.g., climate control, high-bay storage), and labor costs. A $17.3 million project could represent a substantial facility. Without knowing the size (square footage), complexity, and specific location of this DoD warehouse, a direct cost comparison is speculative. However, the amount suggests a project of considerable scale or complexity.

What are the potential risks associated with awarding a large construction contract to 'Miscellaneous Foreign Awardees'?

Awarding a significant contract like this to 'Miscellaneous Foreign Awardees' introduces several potential risks. Firstly, there are challenges in oversight and quality assurance, as monitoring progress and ensuring compliance with standards can be more complex across international borders. Secondly, legal recourse in case of disputes or contract breaches may be more complicated and costly. Thirdly, there are potential security risks if the foreign entities or their personnel are not thoroughly vetted. Finally, from an economic perspective, awarding large contracts to foreign entities may not support domestic industries or job creation, potentially representing a less favorable outcome for U.S. taxpayers compared to domestic awards, assuming comparable quality and price.

What was the duration and timeline of this contract, and were there any performance issues?

This contract had a duration of 1290 days, spanning from September 16, 2010, to March 29, 2014. This indicates a project timeline of approximately 3.5 years, which is a substantial period for a design and build construction project. The provided data does not include information on performance issues, contract modifications, or final delivery success. Typically, such details would be found in contract performance reports or award fee evaluations, which are not available in this summary dataset. The extended duration suggests a project of significant scope or complexity.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W5J9JE10R0099

Offers Received: 38

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2011 CRYSTAL DR STE 911, ARLINGTON, VA, 22202

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $17,271,068

Exercised Options: $17,271,068

Current Obligation: $17,271,068

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline