GSA awards $2.77M contract for Sioux Falls Federal Building renovation, highlighting construction sector activity

Contract Overview

Contract Amount: $2,767,994 ($2.8M)

Contractor: Sunkota Construction, Inc.

Awarding Agency: General Services Administration

Start Date: 2025-01-03

End Date: 2026-08-05

Contract Duration: 579 days

Daily Burn Rate: $4.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: U.S. MARSHALS TENANT IMPROVEMENT RENOVATION -SIOUX FALLS FEDERAL BUILDING/COURTHOUSE 400 SOUTH PHILLIPS SIOUX FALLS, SD 57104

Place of Performance

Location: SIOUX FALLS, MINNEHAHA County, SOUTH DAKOTA, 57104

State: South Dakota Government Spending

Plain-Language Summary

General Services Administration obligated $2.8 million to SUNKOTA CONSTRUCTION, INC. for work described as: U.S. MARSHALS TENANT IMPROVEMENT RENOVATION -SIOUX FALLS FEDERAL BUILDING/COURTHOUSE 400 SOUTH PHILLIPS SIOUX FALLS, SD 57104 Key points: 1. Contract value of $2.77 million for tenant improvements and renovation. 2. Competition was full and open after exclusion of sources, indicating a competitive bidding process. 3. The contract is a firm-fixed-price definitive contract, providing cost certainty. 4. Project duration is 579 days, suggesting a significant scope of work. 5. The contractor, Sunkota Construction, Inc., is based in South Dakota. 6. This award falls under commercial and institutional building construction NAICS code 236220. 7. The project is located in Sioux Falls, South Dakota, impacting local construction services.

Value Assessment

Rating: good

The contract value of $2.77 million for tenant improvements and renovation appears reasonable for a federal building project of this scope. Benchmarking against similar GSA renovation projects would provide a more precise value-for-money assessment. The firm-fixed-price structure helps manage cost risks for the government. Without specific cost breakdowns or detailed scope comparisons, a definitive assessment of pricing efficiency is challenging, but the competitive nature of the award suggests a market-driven price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was intended to be broad, certain sources may have been excluded based on specific criteria. The presence of two bids suggests a moderate level of competition. A higher number of bidders typically leads to more aggressive pricing and better value for the government. The exclusion of sources warrants further investigation to ensure it did not unduly limit competition.

Taxpayer Impact: The competitive process, even with exclusions, aims to secure a fair market price for taxpayers. A moderate number of bidders can still result in cost savings compared to a sole-source award, but a more robust competition could potentially yield greater savings.

Public Impact

The U.S. Marshals Service will benefit from improved facilities in Sioux Falls. The renovation will enhance the functionality and safety of the Federal Building/Courthouse. The project will likely create or sustain jobs within the local construction industry in Sioux Falls and surrounding areas. Federal employees working in the building will experience improved working conditions. The project contributes to the maintenance and modernization of federal infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep during renovation, impacting final cost and timeline.
Ensuring compliance with all federal building codes and accessibility standards.
Managing potential disruptions to ongoing federal operations within the building during construction.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Contract awarded to a local South Dakota-based construction company, potentially supporting the local economy.
Full and open competition, even with exclusions, suggests an effort to achieve fair market value.

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 building of non-residential structures like offices, courthouses, and public facilities. Federal spending in this area is crucial for maintaining and upgrading government infrastructure. Comparable spending benchmarks would involve analyzing other GSA or federal agency contracts for similar renovation and tenant improvement projects in different geographic regions.

Small Business Impact

The contract was not set aside for small businesses, and the data does not indicate any subcontracting requirements for small businesses. This means that opportunities for small business participation may be limited unless Sunkota Construction, Inc. voluntarily engages them. The absence of a small business set-aside or specific subcontracting goals could mean a missed opportunity to foster small business growth within the federal contracting ecosystem for this project.

Oversight & Accountability

Oversight for this contract will likely be managed by the General Services Administration (GSA), specifically the Public Buildings Service. Accountability measures are inherent in the firm-fixed-price contract type, which caps the government's financial liability. Transparency is generally maintained through federal contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected during the contract performance or closeout.

Related Government Programs

Federal Building Renovations
Tenant Improvement Projects
GSA Capital Investments
Courthouse Construction and Maintenance
Public Infrastructure Projects

Risk Flags

Potential for limited competition due to source exclusion.
Risk of unforeseen conditions in an older federal building.
Contract duration may be insufficient if significant issues arise.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $2.8 million to SUNKOTA CONSTRUCTION, INC.. U.S. MARSHALS TENANT IMPROVEMENT RENOVATION -SIOUX FALLS FEDERAL BUILDING/COURTHOUSE 400 SOUTH PHILLIPS SIOUX FALLS, SD 57104

Who is the contractor on this award?

The obligated recipient is SUNKOTA CONSTRUCTION, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $2.8 million.

What is the period of performance?

Start: 2025-01-03. End: 2026-08-05.

What is the track record of Sunkota Construction, Inc. with federal contracts, particularly with the GSA?

Information regarding Sunkota Construction, Inc.'s specific track record with federal contracts, especially with the General Services Administration (GSA), is not detailed in the provided data. A thorough analysis would require accessing federal procurement databases (like FPDS or SAM.gov) to review their past performance, contract history, any reported issues, and client feedback. Understanding their experience with similar-sized projects and federal regulations is crucial for assessing their capability to successfully execute this renovation. Without this historical data, it's difficult to definitively gauge their reliability and past performance in the federal contracting space.

How does the awarded price of $2.77 million compare to similar federal building renovation projects in the region or nationally?

To benchmark the $2.77 million award, one would need to compare it against similar federal building renovation and tenant improvement projects. This involves identifying contracts with comparable scope, size (square footage), complexity, and location. Factors such as the age of the building, specific renovation requirements (e.g., HVAC, electrical, structural), and prevailing labor and material costs in the Sioux Falls area and nationally would need to be considered. The General Services Administration (GSA) often publishes data on its construction projects, which could be used for comparison. A higher number of bids in the competitive process generally suggests the price is closer to market value, but a detailed cost analysis is necessary for a definitive value-for-money assessment.

What are the specific risks associated with renovating an existing federal building, and how are they mitigated in this contract?

Renovating an existing federal building carries inherent risks, including the discovery of unforeseen structural issues, hazardous materials (like asbestos or lead paint), outdated building systems (electrical, plumbing, HVAC) requiring extensive upgrades, and potential disruptions to ongoing federal operations. Mitigation strategies in this contract include the firm-fixed-price (FFP) structure, which shifts much of the cost overrun risk to the contractor. The contract duration of 579 days allows for planned work, and the 'Full and Open Competition After Exclusion of Sources' process aims to select a capable contractor. However, specific contract clauses addressing unforeseen conditions, change order procedures, and site safety protocols are critical for managing these risks effectively.

What is the expected impact of this renovation on the operational efficiency and security of the U.S. Marshals Service in Sioux Falls?

This renovation is expected to significantly enhance the operational efficiency and security of the U.S. Marshals Service by modernizing their workspace. Upgrades to facilities often include improved layouts for better workflow, enhanced technological infrastructure (e.g., secure networks, communication systems), updated security features, and potentially better accommodation for staff and detainees. Improved working conditions can lead to increased staff morale and productivity. The modernization aims to ensure the facility meets current federal standards for safety, accessibility, and operational requirements, thereby supporting the Marshals Service's mission more effectively.

How has federal spending on commercial and institutional building construction (NAICS 236220) trended in recent years, and where does this contract fit?

Federal spending on commercial and institutional building construction (NAICS 236220) has generally seen fluctuations influenced by infrastructure initiatives, agency needs, and budget appropriations. In recent years, there has been a focus on modernizing aging federal facilities, improving energy efficiency, and enhancing security. This $2.77 million contract for the Sioux Falls Federal Building represents a specific investment within this broader category. Analyzing historical spending data for NAICS 236220, particularly by agencies like the GSA, would reveal trends in contract values, project types, and geographic distribution, placing this Sioux Falls project within a larger fiscal context.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 47PJ0024R0117

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3412 N POTSDAM AVE, SIOUX FALLS, SD, 57104

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,784,897

Exercised Options: $2,767,994

Current Obligation: $2,767,994

Actual Outlays: $169,967

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline