DoD awards $26.7M for UAE aircraft hangar construction, highlighting significant overseas infrastructure investment

Contract Overview

Contract Amount: $26,685,484 ($26.7M)

Contractor: Amana Contracting and Steel Buildings Company LLC

Awarding Agency: Department of Defense

Start Date: 2019-09-26

End Date: 2023-12-29

Contract Duration: 1,555 days

Daily Burn Rate: $17.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT LARGE AIRCRAFT MAINTENANCE HANGAR, UNITED ARAB EMIRATES

Plain-Language Summary

Department of Defense obligated $26.7 million to AMANA CONTRACTING AND STEEL BUILDINGS COMPANY LLC for work described as: CONSTRUCT LARGE AIRCRAFT MAINTENANCE HANGAR, UNITED ARAB EMIRATES Key points: 1. The contract value represents a substantial investment in critical overseas operational support infrastructure. 2. Construction services for large-scale industrial facilities often involve complex logistics and specialized labor. 3. The firm-fixed-price contract type suggests a defined scope and budget, aiming to control costs. 4. A long performance period indicates a large, multi-phase project requiring sustained contractor effort. 5. The award was made under full and open competition, suggesting a robust bidding process. 6. The geographic location in the UAE points to strategic military positioning and operational requirements.

Value Assessment

Rating: good

The contract value of $26.7 million for constructing a large aircraft maintenance hangar in the UAE appears reasonable given the scale and complexity of such a project. Benchmarking against similar overseas military construction projects would provide a more precise value-for-money assessment. The firm-fixed-price structure generally offers good value by shifting cost overrun risks to the contractor, provided the initial scope was well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified contractors had the opportunity to bid. With 9 bidders, the competition level was robust, which typically drives more competitive pricing and encourages innovation. This broad competition suggests that the government likely received a fair market price for the construction services.

Taxpayer Impact: A competitive bidding process for this large infrastructure project ensures that taxpayer dollars are used efficiently, securing the best possible price and quality for essential military facilities.

Public Impact

The primary beneficiaries are the U.S. military forces operating in or deploying through the United Arab Emirates, gaining enhanced maintenance capabilities for aircraft. The project delivers a critical piece of infrastructure: a large aircraft maintenance hangar, essential for operational readiness and support. The geographic impact is concentrated in the United Arab Emirates, supporting U.S. Central Command's operational footprint. Workforce implications include the creation of construction jobs, potentially both locally in the UAE and for specialized U.S. personnel involved in the project.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope was not fully defined initially, despite the firm-fixed-price structure.
Logistical challenges and potential delays associated with construction in a foreign country.
Ensuring compliance with local building codes and environmental regulations in the UAE.
Quality control and oversight for a large-scale construction project over a multi-year period.

Positive Signals

Awarded under full and open competition, indicating a competitive market and likely fair pricing.
Firm-fixed-price contract type helps manage budget certainty and shifts risk to the contractor.
The project addresses a clear and significant operational need for aircraft maintenance support.
The long performance period suggests a well-planned, phased approach to a complex build.

Sector Analysis

This contract falls within the Industrial Building Construction sector, a segment of the broader construction industry focused on specialized facilities. The market for large-scale military construction, particularly overseas, is often characterized by a limited number of large, experienced contractors capable of handling complex projects with significant logistical requirements. Spending benchmarks for similar overseas military infrastructure projects would typically be in the tens to hundreds of millions of dollars, depending on scale and location.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. Large-scale construction projects of this magnitude are typically awarded to larger firms with the capacity and bonding required. The absence of small business set-aside information suggests limited direct opportunities for small businesses on the prime contract, though they might participate as subcontractors if not explicitly excluded.

Oversight & Accountability

Oversight for this contract would primarily be managed by the Department of the Army contracting and project management offices, likely with support from the Defense Contract Management Agency (DCMA) for on-site quality assurance and progress monitoring. Transparency is generally maintained through contract award databases like FPDS. Accountability measures are inherent in the firm-fixed-price contract, with penalties or remedies for non-performance. Inspector General (IG) jurisdiction would apply if significant fraud, waste, or abuse were suspected.

Related Government Programs

Overseas Military Construction
Aircraft Maintenance Facilities
Department of Defense Construction Contracts
Army Corps of Engineers Projects
Foreign Military Basing Support

Risk Flags

Potential for schedule delays due to overseas location and logistics.
Risk of cost escalation if unforeseen site conditions arise, despite firm-fixed-price.
Ensuring compliance with local UAE regulations and standards.
Management of a large, potentially diverse construction workforce.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.7 million to AMANA CONTRACTING AND STEEL BUILDINGS COMPANY LLC. CONSTRUCT LARGE AIRCRAFT MAINTENANCE HANGAR, UNITED ARAB EMIRATES

Who is the contractor on this award?

The obligated recipient is AMANA CONTRACTING AND STEEL BUILDINGS COMPANY LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $26.7 million.

What is the period of performance?

Start: 2019-09-26. End: 2023-12-29.

What is the historical spending trend for similar aircraft maintenance hangar construction projects by the Department of Defense, both domestically and internationally?

Analyzing historical spending for similar projects reveals that large aircraft maintenance hangars are significant investments, often ranging from $10 million to over $100 million depending on size, complexity, and location. International projects, like this one in the UAE, can incur higher costs due to logistical challenges, import duties, and the need to comply with foreign regulations. The Department of Defense frequently awards such contracts to support its global operational posture. For instance, similar projects in regions like the Pacific or Europe have seen substantial funding allocated. Benchmarking this $26.7 million award against a portfolio of comparable projects would indicate whether it falls within the expected cost range, considering its specific scope and the strategic location in the UAE.

How does the per-square-foot construction cost of this hangar compare to industry benchmarks for similar industrial facilities?

To assess the per-square-foot cost, the total contract value ($26,685,483.73) would need to be divided by the total square footage of the hangar. Without the square footage, a direct comparison is impossible. However, for large industrial or aircraft maintenance facilities, construction costs can vary widely based on location, materials, specialized equipment integration (e.g., cranes, ventilation systems), and architectural complexity. Typical benchmarks for industrial construction can range from $200 to $500+ per square foot. Given the overseas location and specialized nature of an aircraft maintenance hangar, costs could be at the higher end of this spectrum or even exceed it. A detailed analysis would require the hangar's dimensions and specific features.

What is the track record of AMANA CONTRACTING AND STEEL BUILDINGS COMPANY LLC in executing large-scale DoD construction contracts, particularly overseas?

AMANA CONTRACTING AND STEEL BUILDINGS COMPANY LLC has a history of performing construction work for the U.S. government, including projects within the Department of Defense. Their portfolio includes various types of construction, often involving steel buildings and industrial facilities. Evaluating their track record for large-scale overseas projects requires examining past performance reviews, on-time delivery rates, and any history of contract disputes or modifications. While this specific contract award indicates they were deemed capable, a deeper dive into their past performance on similar complex, high-value projects, especially in challenging international environments, would provide a clearer picture of their reliability and execution capabilities for the DoD.

What are the potential risks associated with constructing a large aircraft maintenance hangar in the United Arab Emirates, and how were they mitigated?

Constructing a large aircraft maintenance hangar in the UAE presents several risks, including geopolitical instability, extreme climate conditions (heat, sandstorms), logistical challenges in material sourcing and transportation, labor availability and management, and adherence to local building codes and customs. Potential mitigations employed by the DoD and the contractor likely included thorough site surveys, robust logistical planning, partnerships with local entities for labor and materials, stringent quality control measures adapted to the climate, and contingency planning for unforeseen events. The firm-fixed-price contract structure also incentivizes the contractor to proactively manage these risks to avoid cost overruns.

How does the duration of this contract (1555 days) align with typical timelines for similar large-scale overseas construction projects?

A duration of 1555 days, approximately 4.25 years, is generally consistent with the timelines for large-scale, complex construction projects, especially those undertaken overseas. Factors contributing to such extended durations include the design and engineering phase, procurement of specialized materials, complex site preparation, the actual construction process which can be affected by weather and local conditions, and final commissioning. For a major infrastructure asset like an aircraft maintenance hangar, which requires significant structural work, specialized systems installation, and extensive testing, a multi-year timeline is not unusual. This duration suggests a comprehensive project scope that necessitates careful, phased execution.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Industrial 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: W912ER19R0001

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: MOHAMMAD RASHID KHAMIS DHAHERI BUIL ABU DHABI, DUBAI

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $26,685,484

Exercised Options: $26,685,484

Current Obligation: $26,685,484

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline