DoD's $9.16M Barracks Elevator Replacement in Korea: A Look at Construction Value and Competition

Contract Overview

Contract Amount: $9,163,708 ($9.2M)

Contractor: Ilkwang E&C CO., Ltd.

Awarding Agency: Department of Defense

Start Date: 2023-09-27

End Date: 2026-04-20

Contract Duration: 936 days

Daily Burn Rate: $9.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: FY23 OMA VARIOUS FEWRS, REPLACE ELEVATORS AT SIX BARRACKS, USAG HUMPHREYS, KOREA.

Plain-Language Summary

Department of Defense obligated $9.2 million to ILKWANG E&C CO., LTD. for work described as: FY23 OMA VARIOUS FEWRS, REPLACE ELEVATORS AT SIX BARRACKS, USAG HUMPHREYS, KOREA. Key points: 1. Contract awarded for essential infrastructure upgrades at a major US Army installation in South Korea. 2. The project involves replacing elevators across six barracks, indicating a focus on maintaining living conditions for service members. 3. Competition dynamics for this construction contract will be key to assessing value for taxpayer dollars. 4. The firm-fixed-price structure aims to control costs, but the specific market conditions in Korea will influence the final price. 5. Performance risk is moderate, given the nature of construction and the need for specialized elevator expertise. 6. This contract represents a small fraction of the Department of the Army's overall facilities maintenance and repair budget. 7. The contractor, ILKWANG E&C CO., LTD., will be assessed on its ability to deliver quality work within the specified timeframe.

Value Assessment

Rating: fair

Benchmarking the $9.16 million cost for elevator replacements across six barracks in South Korea is challenging without specific project scope details and local construction cost data. However, the average cost per barrack for this project is approximately $1.53 million. This figure needs to be compared against similar large-scale elevator modernization projects within military installations or comparable commercial buildings in the region. The firm-fixed-price contract type suggests an attempt to lock in costs, but the ultimate value will depend on the contractor's efficiency and the accuracy of the initial cost estimates relative to the actual work performed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 8 bidders suggests a reasonably competitive environment for this construction project. A higher number of bidders generally leads to more competitive pricing as contractors vie for the award. The specific details of the bidding process and the range of proposals received would provide further insight into the effectiveness of the competition in driving down costs.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of securing the best possible price for the services rendered, fostering a market where efficiency and cost-effectiveness are rewarded.

Public Impact

Service members residing in six barracks at USAG Humphreys, South Korea, will benefit from improved safety and accessibility due to new elevators. The project ensures the continued operational readiness and habitability of critical housing infrastructure. The geographic impact is localized to USAG Humphreys, a significant US Army installation in South Korea. The contract supports the construction and maintenance workforce, likely involving skilled trades and project management personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for construction delays impacting service member housing availability.
Risk of cost overruns if unforeseen site conditions arise during elevator replacement.
Ensuring compliance with Korean building codes and safety regulations alongside US military standards.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
Firm-fixed-price contract type helps to mitigate cost uncertainty for the government.
Project addresses essential infrastructure maintenance, crucial for troop morale and readiness.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on infrastructure upgrades. The global construction market, particularly for specialized services like elevator modernization in large facilities, is substantial. This project represents a specific need within the Department of Defense's extensive real property portfolio, aiming to maintain and improve living and working conditions at overseas installations. Comparable spending benchmarks would typically involve other large-scale renovation or new construction projects on military bases, both domestically and internationally.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions (ss: false, sb: false). Therefore, the direct impact on small businesses through set-asides is unlikely. However, the prime contractor, ILKWANG E&C CO., LTD., may engage small businesses as subcontractors for various aspects of the construction work, contributing indirectly to the small business ecosystem. Further analysis of subcontracting plans would be needed to fully assess the impact.

Oversight & Accountability

Oversight for this contract will likely be managed by the relevant contracting command within the Department of the Army, potentially with support from the US Army Corps of Engineers for construction quality assurance. Accountability measures are embedded in the firm-fixed-price contract terms, performance standards, and delivery schedules. Transparency is generally maintained through contract award databases and reporting requirements, though specific project-level details might be less publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Facilities Maintenance and Repair
US Army Corps of Engineers Construction Contracts
Overseas Military Construction Projects
Elevator Modernization Projects
Barracks Improvement Programs

Risk Flags

Potential for delays impacting service member readiness.
Quality assurance of construction work.
Compliance with local and military building codes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.2 million to ILKWANG E&C CO., LTD.. FY23 OMA VARIOUS FEWRS, REPLACE ELEVATORS AT SIX BARRACKS, USAG HUMPHREYS, KOREA.

Who is the contractor on this award?

The obligated recipient is ILKWANG E&C CO., LTD..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $9.2 million.

What is the period of performance?

Start: 2023-09-27. End: 2026-04-20.

What is the track record of ILKWANG E&C CO., LTD. with Department of Defense contracts, particularly for construction and infrastructure projects?

A review of publicly available contract data indicates that ILKWANG E&C CO., LTD. has a history of securing contracts with the Department of Defense, primarily in construction and engineering services, often in overseas locations like South Korea. While specific performance metrics for past projects are not detailed here, the award of this $9.16 million contract suggests a level of confidence from the contracting agency in the company's capabilities. Further investigation into past performance evaluations, any documented disputes, or contract modifications on previous DoD projects would provide a more comprehensive understanding of their track record and reliability for complex infrastructure undertakings.

How does the $9.16 million cost for elevator replacements compare to similar projects at other US military installations globally?

Directly comparing the $9.16 million cost for replacing elevators at six barracks without detailed project specifications (e.g., number of elevators per barrack, complexity of modernization, specific site conditions) is difficult. However, the average cost per barrack is approximately $1.53 million. This figure should be benchmarked against similar large-scale elevator modernization projects within military housing or institutional buildings. Factors such as local labor costs, material availability in South Korea, and the specific technological upgrades included in the 'replacement' will significantly influence this cost. Without comparative data from similar overseas installations or domestic projects of comparable scale and scope, assessing whether this represents excellent, fair, or questionable value is challenging.

What are the primary risks associated with this specific elevator replacement project, and how are they being mitigated?

The primary risks include potential construction delays due to unforeseen site conditions, coordination challenges with ongoing base operations, and ensuring the quality and longevity of the new elevator systems. Mitigation strategies likely involve detailed site surveys prior to commencement, phased construction schedules to minimize disruption, robust quality assurance/quality control (QA/QC) processes during installation, and adherence to stringent safety protocols. The firm-fixed-price contract also shifts some financial risk to the contractor, incentivizing them to manage costs and timelines effectively. Furthermore, the contractor's experience with similar projects and compliance with relevant building codes are critical risk-reduction factors.

What is the expected impact of these elevator upgrades on the daily lives and morale of service members stationed at USAG Humphreys?

The replacement of aging elevators is expected to significantly improve the daily lives of service members by enhancing safety, reliability, and accessibility within their barracks. Malfunctioning or outdated elevators can lead to inconvenience, increased physical strain (especially for those with mobility issues), and potential safety hazards. Modern, reliable elevators contribute to a more comfortable and secure living environment, which is crucial for troop morale and overall well-being. This infrastructure improvement signals investment in the quality of life for personnel stationed at the base, potentially boosting satisfaction and readiness.

How has spending on facilities maintenance and repair at USAG Humphreys or similar overseas installations trended over the past five fiscal years?

Analyzing spending trends for facilities maintenance and repair at specific overseas installations like USAG Humphreys requires access to detailed historical budget and expenditure data, which is not provided in the current dataset. Generally, spending in this category can fluctuate based on the age of infrastructure, deferred maintenance backlogs, and strategic investment priorities. Major projects like elevator replacements often represent targeted investments to address critical needs or modernize aging facilities. A broader trend analysis across the Department of Defense or specific major commands would be necessary to contextualize this $9.16 million expenditure within a larger pattern of facilities investment.

What are the specific technological advancements or features included in the new elevators that justify the investment?

The provided data does not specify the technological advancements or features included in the new elevators beyond a general 'replacement.' Modern elevator systems can incorporate energy-efficient designs, advanced safety features (e.g., seismic sensors, improved emergency communication), enhanced accessibility options (e.g., larger car sizes, voice-activated controls), and integrated monitoring systems for predictive maintenance. The justification for the investment would hinge on these upgrades providing tangible benefits in terms of safety, operational efficiency, reduced long-term maintenance costs, and improved user experience compared to the existing elevators. A detailed technical specification or scope of work would be needed to answer this precisely.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912UM23R0019

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 48, DOLMA-RO, BUNDANG-GU, SEONGNAM-SI

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

Financial Breakdown

Contract Ceiling: $9,163,708

Exercised Options: $9,163,708

Current Obligation: $9,163,708

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline