DOD awards $43.4M contract for multifamily housing construction to ABSHER CONSTRUCTION CO

Contract Overview

Contract Amount: $43,376,058 ($43.4M)

Contractor: Absher Construction CO

Awarding Agency: Department of Defense

Start Date: 2004-05-18

End Date: 2009-07-31

Contract Duration: 1,900 days

Daily Burn Rate: $22.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Place of Performance

Location: FORT LEWIS, PIERCE County, WASHINGTON, 98433

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $43.4 million to ABSHER CONSTRUCTION CO for work described as: Key points: 1. Contract value represents a significant investment in military housing infrastructure. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. Fixed-price contract type may offer cost certainty but could limit flexibility for unforeseen issues. 4. The duration of the contract (1900 days) indicates a long-term project with substantial resource commitment. 5. The project's focus on new construction suggests a need to expand or modernize existing housing stock. 6. The award to a single contractor implies a focus on specialized capabilities or economies of scale.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific project scope details or comparable construction costs in the region. However, a $43.4 million contract for new multifamily housing construction over approximately five years indicates a substantial investment. The firm fixed-price nature suggests that the contractor assumed the primary risk for cost overruns, which can be a positive indicator of value if the final cost aligns with initial projections. Further analysis would require comparing the per-unit cost or cost per square foot to similar military housing projects or private sector developments in the same geographic area.

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 bids. This typically suggests a robust bidding environment where multiple contractors vied for the award. The presence of 11 bids (no: 11) further supports the notion of a competitive process. A higher number of bidders generally leads to more competitive pricing and a greater likelihood of selecting the best value proposal.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices due to contractor rivalry and the assurance that the government sought the most advantageous offer.

Public Impact

Military personnel and their families stationed at the relevant base will benefit from improved housing. The contract will result in the construction of new multifamily housing units, increasing available on-base residences. The geographic impact is localized to the area where the Department of the Army is undertaking this construction project. The construction project will likely create numerous jobs in the construction sector, benefiting the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for all construction variables.
Risk of delays impacting military housing availability if the contractor faces unforeseen challenges.
Dependence on a single contractor for a large-scale, multi-year project could create vulnerabilities.
Ensuring quality control throughout a long construction period requires diligent oversight.

Positive Signals

Award through full and open competition suggests a competitive pricing environment.
Firm fixed-price contract shifts cost risk to the contractor.
Long contract duration allows for phased construction and potential learning curve efficiencies.
The Department of the Army's selection of a specific contractor implies they met stringent requirements.

Sector Analysis

This contract falls within the construction sector, specifically focusing on new multifamily housing. The construction industry is a significant component of the US economy, with substantial government spending on infrastructure and facilities. Military housing construction is a recurring need for the Department of Defense, aimed at providing adequate living conditions for service members and their families. Comparable spending benchmarks would involve analyzing other large-scale housing projects awarded by federal agencies or major private developers for similar types of residential units.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false) and there is no explicit mention of small business subcontracting goals. This suggests that the primary award went to a large business. The absence of a small business set-aside means that opportunities for small businesses would likely be through subcontracting if ABSHER CONSTRUCTION CO. chooses to engage them. The impact on the small business ecosystem depends on the extent to which the prime contractor integrates small businesses into its supply chain for this project.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer's representative (COR) and the relevant contracting activity within the Department of the Army. Accountability measures are embedded in the contract terms, including performance standards, delivery schedules, and payment milestones. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if allegations of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

Military Construction, Army
Family Housing Construction
Department of Defense Housing Programs
Federal Construction Contracts

Risk Flags

Long contract duration increases exposure to market volatility.
Firm Fixed Price contract places significant cost risk on the contractor.
Potential for quality compromises if contractor faces cost pressures.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $43.4 million to ABSHER CONSTRUCTION CO. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is ABSHER CONSTRUCTION CO.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $43.4 million.

What is the period of performance?

Start: 2004-05-18. End: 2009-07-31.

What is the historical spending pattern of the Department of the Army on multifamily housing construction over the last five fiscal years?

Analyzing the Department of the Army's historical spending on multifamily housing construction requires accessing detailed federal procurement data. Based on general trends, the Army consistently invests in military family housing, which includes new construction, renovation, and maintenance. Spending can fluctuate based on military readiness needs, budget allocations, and the lifecycle of existing housing stock. For instance, periods of significant troop deployment or base realignment might see increased investment in housing infrastructure. Without specific data for the last five fiscal years, it's difficult to provide exact figures, but it is reasonable to assume multi-billion dollar annual investments across the Army's portfolio of housing projects, with specific large construction contracts like this one representing significant portions of that spending in particular years or locations.

How does the awarded amount of $43.4 million compare to the average cost of similar military housing construction projects?

Comparing the $43.4 million award to the average cost of similar military housing projects requires detailed benchmarking data that is not publicly available in a standardized format. However, the cost of military housing construction can vary significantly based on location, size (number of units), amenities, and specific design requirements. A project of this magnitude, awarded to a single entity, suggests a substantial undertaking, potentially involving hundreds of units or complex architectural designs. To provide a precise comparison, one would need to identify projects with similar unit counts, square footage, and geographic cost-of-living indices. Generally, large-scale construction projects benefit from economies of scale, but the unique security and logistical requirements of military installations can also influence costs.

What is ABSHER CONSTRUCTION CO.'s track record with large federal construction contracts, particularly for the Department of Defense?

ABSHER CONSTRUCTION CO. has a history of securing and performing on federal construction contracts. A review of public procurement databases would reveal the extent and nature of their past work, including contracts awarded by the Department of Defense and other federal agencies. Their experience likely encompasses various types of construction, potentially including residential, commercial, and institutional facilities. The successful award of a $43.4 million contract for multifamily housing by the Department of the Army suggests that ABSHER CONSTRUCTION CO. possesses the necessary qualifications, financial capacity, and past performance record to undertake projects of this scale and complexity. Further due diligence would involve examining specific past projects for performance ratings, any disputes, and their overall success rate.

What are the potential risks associated with a firm fixed-price contract for a project of this duration and scale?

A firm fixed-price (FFP) contract, while offering cost certainty to the government, carries inherent risks for both parties on a large, long-duration project like this multifamily housing construction. For the government, the primary risk is that the contractor may cut corners on quality or materials to maintain profitability if costs escalate unexpectedly, although quality assurance measures should mitigate this. For the contractor (ABSHER CONSTRUCTION CO.), the risk is significant: if material costs, labor, or unforeseen site conditions (e.g., environmental issues, unexpected subsurface challenges) drive costs above the fixed price, the contractor absorbs the loss. Given the 1900-day duration, market fluctuations in material prices and labor availability pose a substantial risk. Effective risk management by the contractor, including robust contingency planning and accurate initial cost estimation, is crucial for success under an FFP agreement.

How does the competition level (11 bidders) for this contract potentially influence the final price and quality of the housing constructed?

A competition level involving 11 bidders for this $43.4 million multifamily housing contract is generally considered robust and is likely to have a positive impact on both price and quality. With numerous firms submitting proposals, the government has a wider pool of potential contractors to choose from, increasing the likelihood of receiving competitive bids that reflect market rates. This intense competition incentivizes bidders to offer their best possible pricing to win the contract. Furthermore, to secure the award, contractors are motivated to present proposals that clearly demonstrate their capability to deliver high-quality construction that meets or exceeds the government's specifications. A higher number of bidders typically leads to better price discovery and reduces the risk of awarding the contract to a less capable or overpriced bidder.

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

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1001 SHAW RD S E, PUYALLUP, WA, 10

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $58,385

Exercised Options: $58,385

Current Obligation: $43,376,058

Contract Characteristics

Cost or Pricing Data: NO

Timeline