Department of Defense awards $163.6M contract for commercial and institutional building construction

Contract Overview

Contract Amount: $16,364,686 ($16.4M)

Contractor: Mushrif Trading and Contracting Company Kscc

Awarding Agency: Department of Defense

Start Date: 2005-05-25

End Date: 2010-07-15

Contract Duration: 1,877 days

Daily Burn Rate: $8.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 16

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Plain-Language Summary

Department of Defense obligated $16.4 million to MUSHRIF TRADING AND CONTRACTING COMPANY KSCC for work described as: Key points: 1. Contract value of $163.6 million indicates significant investment in construction services. 2. Full and open competition suggests a robust bidding process, potentially leading to better pricing. 3. The contract duration of over 1800 days points to a long-term project with sustained economic impact. 4. Fixed-price contract type shifts performance risk to the contractor, potentially stabilizing costs. 5. The award to MUSHRIF TRADING AND CONTRACTING COMPANY KSCC highlights a key player in the sector. 6. The North American Industry Classification System (NAICS) code 236220 places this contract within the broader construction industry.

Value Assessment

Rating: fair

Benchmarking the value of this $163.6 million contract is challenging without specific project details or comparable contract data. However, the firm fixed-price nature suggests that the contractor bears the risk of cost overruns, which can be a positive indicator for the government if managed effectively. The duration of the contract (over 1800 days) implies a substantial scope of work, and the final cost should be evaluated against the delivered assets and their long-term utility. Without more granular data on the specific construction services rendered, a definitive value-for-money assessment is difficult.

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 approach typically fosters a competitive environment, encouraging multiple bidders to offer their best pricing and technical solutions. The presence of 16 bids suggests a healthy level of interest and competition for this significant construction project, which generally benefits the government through potentially lower prices and higher quality outcomes.

Taxpayer Impact: Full and open competition generally leads to more competitive pricing for taxpayers by ensuring a wide range of contractors vie for the work, driving down costs through market forces.

Public Impact

The primary beneficiaries are likely the Department of Defense and its personnel, who will gain improved or new facilities. The contract delivers essential commercial and institutional building construction services, contributing to infrastructure development. The geographic impact is not specified but is likely tied to a specific military installation or region where the construction is taking place. The project will have implications for the construction workforce, creating jobs for skilled laborers, tradespeople, and project managers. The successful completion of the construction project will enhance operational capabilities and living conditions for military personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for unforeseen construction challenges.
Risk of delays impacting military readiness or operational timelines if project milestones are not met.
Quality control concerns inherent in large-scale construction projects require diligent oversight.
Contractor performance history and capacity to manage a project of this magnitude need continuous monitoring.

Positive Signals

The firm fixed-price contract structure incentivizes the contractor to manage costs efficiently.
Full and open competition suggests a strong likelihood of receiving competitive bids, potentially leading to better value.
The long contract duration allows for phased development and potential learning curve efficiencies.
The award to a single contractor for a large project can streamline project management and coordination.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a vital part of the broader construction industry. This sector encompasses the construction of non-residential buildings such as offices, warehouses, industrial facilities, and public buildings. The total federal spending on construction services is substantial, with significant portions allocated to infrastructure, military facilities, and government buildings. This contract represents a notable investment within this sector, contributing to the overall economic activity and employment within the construction trades.

Small Business Impact

The data indicates that small business participation was not a primary focus for this contract, as the 'small business set-aside' flag is false. There is no explicit information on subcontracting plans for small businesses. This suggests that the primary contractor, MUSHRIF TRADING AND CONTRACTING COMPANY KSCC, will likely handle the majority of the work. Further investigation into subcontracting opportunities would be necessary to determine the actual impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and their representatives within the Department of the Army. The firm fixed-price nature shifts some risk to the contractor, but government oversight is still crucial to ensure adherence to specifications, quality standards, and timely completion. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Construction
Base Realignment and Closure (BRAC) Projects
Department of Defense Facilities Management
General Services Administration (GSA) Construction Contracts

Risk Flags

Potential for cost overruns due to long contract duration.
Risk of quality degradation if contractor prioritizes speed over standards.
Dependency on contractor's financial stability and performance capacity.
Unforeseen site conditions could impact schedule and cost.
Adequacy of government oversight to ensure compliance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.4 million to MUSHRIF TRADING AND CONTRACTING COMPANY KSCC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is MUSHRIF TRADING AND CONTRACTING COMPANY KSCC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $16.4 million.

What is the period of performance?

Start: 2005-05-25. End: 2010-07-15.

What is the track record of MUSHRIF TRADING AND CONTRACTING COMPANY KSCC with the Department of Defense?

Assessing the track record of MUSHRIF TRADING AND CONTRACTING COMPANY KSCC with the Department of Defense requires a review of their past performance on similar contracts. This would involve examining contract histories for on-time delivery, adherence to budget, quality of work, and any instances of disputes or contract modifications. A positive performance history on previous DoD projects would indicate a lower risk for this current contract. Conversely, a history of issues could signal potential challenges. Without access to specific past performance evaluations or a detailed contract database, a definitive assessment of their track record is not possible from the provided data alone.

How does the $163.6 million contract value compare to similar construction projects awarded by the Department of Defense?

The $163.6 million contract value is substantial and falls within the range of large-scale construction projects. To benchmark this value, one would need to compare it against other Department of Defense (DoD) contracts for similar types of commercial and institutional building construction, considering factors like project scope, complexity, location, and duration. For instance, if the DoD frequently awards contracts in the $100-$200 million range for similar facilities, this contract would be considered within the typical market. If comparable projects are consistently awarded for significantly less, it might warrant further scrutiny regarding value for money. The number of bids (16) suggests market interest, but the final price relative to scope is the key determinant of value.

What are the primary risks associated with a firm fixed-price contract for a construction project of this duration?

A firm fixed-price (FFP) contract for a long-duration construction project like this one (over 1800 days) carries specific risks. The primary risk for the contractor is underestimating costs, leading to reduced profit margins or even losses if unforeseen issues arise (e.g., material price increases, labor shortages, unexpected site conditions). For the government, the risk is that the contractor might cut corners on quality or safety to maintain profitability, or that the initial price might have been inflated to account for the contractor's perceived risk. Effective government oversight is crucial to mitigate these risks by ensuring quality standards are met and that the contractor is managing the project effectively throughout its lifecycle.

How effective is full and open competition in ensuring optimal pricing for large construction contracts?

Full and open competition is generally considered the most effective method for ensuring optimal pricing for large construction contracts. By allowing all responsible sources to bid, the government maximizes the pool of potential contractors, thereby increasing the likelihood of receiving competitive offers. This competitive pressure incentivizes bidders to submit their most favorable pricing and technical proposals to win the contract. The fact that 16 bids were received for this contract suggests that the full and open competition strategy was successful in attracting significant market interest. While it doesn't guarantee the lowest possible price, it creates a strong market dynamic that typically drives prices down compared to less competitive procurement methods.

What are the potential long-term implications of this $163.6 million construction award on the relevant industry sector?

A $163.6 million construction award can have significant long-term implications for the industry sector. It injects substantial capital into the commercial and institutional building construction market, potentially stimulating economic activity and job creation within that sector. For the winning contractor, MUSHRIF TRADING AND CONTRACTING COMPANY KSCC, this large contract can enhance their reputation, provide valuable experience, and potentially lead to future opportunities. It can also influence market dynamics by demonstrating capabilities and potentially setting benchmarks for future projects. Furthermore, the completed facility will serve a long-term purpose for the Department of Defense, contributing to its operational readiness and infrastructure.

Are there any specific performance metrics or key performance indicators (KPIs) typically associated with such construction contracts?

Yes, construction contracts of this magnitude typically include specific performance metrics and Key Performance Indicators (KPIs) to ensure successful project execution. These often include adherence to the project schedule (e.g., milestone completion dates, overall project completion date), quality of workmanship (measured against specifications and industry standards), safety performance (e.g., incident rates, compliance with safety regulations), and budget management. For a firm fixed-price contract, the contractor's ability to manage costs within the agreed-upon price is a critical KPI. The government will monitor these KPIs closely through regular progress reports, site inspections, and performance reviews to ensure the contractor is meeting contractual obligations.

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

Offers Received: 16

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: AREA 1, STREET 7, PLOT 166, AL RAI

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline