Millennium Challenge Corporation leases office space for $66.3M, awarded to Franklin Court Inc. via full and open competition

Contract Overview

Contract Amount: $66,338,829 ($66.3M)

Contractor: Franklin Court Inc

Awarding Agency: Millennium Challenge Corporation

Start Date: 2014-01-31

End Date: 2025-12-13

Contract Duration: 4,334 days

Daily Burn Rate: $15.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: LEASED OFFICE SPACE IGF::OT::IGF

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005

State: District of Columbia Government Spending

Plain-Language Summary

Millennium Challenge Corporation obligated $66.3 million to FRANKLIN COURT INC for work described as: LEASED OFFICE SPACE IGF::OT::IGF Key points: 1. The contract value of $66.3 million over its term represents a significant investment in leased office space. 2. Full and open competition suggests a potentially competitive bidding process, which can lead to better pricing. 3. The contract duration of over 10 years indicates a long-term commitment to this specific leased facility. 4. The fixed-price contract type provides cost certainty for the government, shifting cost overrun risks to the contractor. 5. The primary service is the leasing of nonresidential buildings, a common requirement for federal agencies. 6. The contract is located in the District of Columbia, a high-demand real estate market.

Value Assessment

Rating: fair

Benchmarking the value of leased office space is complex and depends heavily on location, size, and amenities. Given the $66.3 million total value over more than a decade, the annual cost is approximately $6.6 million. Without specific details on square footage and location within the District of Columbia, a precise value-for-money assessment is difficult. However, federal agencies often face higher leasing costs in prime urban areas due to market demand and security requirements. Comparing this to similar large-scale office leases in DC would be necessary for a definitive judgment.

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. The presence of 8 bidders (no) suggests a reasonably competitive environment for this lease. A higher number of bidders generally correlates with more competitive pricing and a wider selection of suitable properties. The fact that it was competed broadly is a positive sign for price discovery.

Taxpayer Impact: A competitive bidding process for essential services like office space helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

The Millennium Challenge Corporation benefits from having a dedicated office space to conduct its operations. The services delivered include the provision of nonresidential building space, essential for agency functioning. The geographic impact is concentrated in the District of Columbia, supporting the local commercial real estate market. The contract supports jobs within the commercial real estate sector, including property management and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long-term lease commitment may reduce flexibility if agency needs change significantly.
Reliance on a single contractor for a critical asset like office space can create dependency.
Market fluctuations in DC real estate could impact the long-term value proposition of the lease.

Positive Signals

Full and open competition suggests a robust procurement process.
Fixed-price contract provides budget certainty.
Award to a single entity simplifies contract management.

Sector Analysis

The federal government is a major tenant in the commercial real estate market, particularly in Washington D.C. This contract falls within the 'Lessors of Nonresidential Buildings' sector, which is a critical component of the broader commercial real estate industry. The market for office space in D.C. is highly competitive and subject to economic conditions, government demand, and urban development trends. Comparable spending benchmarks would involve analyzing average lease rates per square foot for similar government-leased properties in the D.C. metropolitan area.

Small Business Impact

The data indicates that small business participation was not a specific set-aside requirement for this contract (sb: false). There is no explicit information on subcontracting plans for small businesses. Without specific set-aside goals or reporting requirements, the direct impact on the small business ecosystem is likely minimal, unless the prime contractor voluntarily engages small businesses for services related to the leased property.

Oversight & Accountability

Oversight for this contract would typically fall under the Millennium Challenge Corporation's contracting officer and program managers. Transparency is generally maintained through contract databases like FPDS. Accountability measures are inherent in the contract terms, with potential penalties for non-performance. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Building Leases
Government Office Space Acquisition
Commercial Real Estate Services
Agency Operational Support Contracts

Risk Flags

Long-term commitment
High contract value
Location in high-cost real estate market

Frequently Asked Questions

What is this federal contract paying for?

Millennium Challenge Corporation awarded $66.3 million to FRANKLIN COURT INC. LEASED OFFICE SPACE IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is FRANKLIN COURT INC.

Which agency awarded this contract?

Awarding agency: Millennium Challenge Corporation (Millennium Challenge Corporation).

What is the total obligated amount?

The obligated amount is $66.3 million.

What is the period of performance?

Start: 2014-01-31. End: 2025-12-13.

What is the average annual cost per square foot for this leased space, and how does it compare to market rates in Washington D.C.?

The provided data does not include the square footage of the leased space, making it impossible to calculate the cost per square foot. To assess value, one would need to obtain the total square footage from the contract award details and compare the resulting cost per square foot to prevailing market rates for comparable office spaces in the District of Columbia. Factors such as building class, amenities, location within D.C., and lease term length significantly influence these rates. Without this information, a direct comparison to market benchmarks is speculative.

What is the track record of Franklin Court Inc. in providing similar leasing services to the federal government?

Franklin Court Inc. is listed as the contractor for this lease. To assess their track record, one would need to search federal procurement databases (like FPDS or SAM.gov) for other contracts awarded to this entity. This would reveal the number of previous federal contracts, their values, agencies served, and performance history. A history of successful, on-time, and within-budget performance on similar large-scale leasing contracts would indicate a reliable contractor. Conversely, a history of disputes, performance issues, or contract terminations would raise concerns.

How does the total contract value of $66.3 million compare to other federal office space leases of similar duration and location?

The total contract value of $66.3 million over approximately 11.5 years (from Jan 2014 to Dec 2025) averages around $5.76 million per year. This figure needs to be contextualized by the square footage leased and the specific location within D.C. Federal agencies often pay premium rates for secure, well-located office space in the capital. To compare, one would look for data on other large federal leases in D.C., noting their size, duration, and annual cost. Without knowing the specific size of this leased space, a direct comparison is difficult, but the annual expenditure is substantial, reflecting the high cost of real estate in the D.C. area.

What are the specific performance metrics or service level agreements (SLAs) included in this lease agreement?

The provided summary data does not detail the specific performance metrics or service level agreements (SLAs) for this lease contract. Typically, such agreements would cover aspects like building maintenance, security, janitorial services, HVAC functionality, and response times for repairs. The contract award notice (AW) indicates a 'DEFINITIVE CONTRACT,' which implies a formal agreement with defined terms. To understand the performance expectations, one would need to review the full contract document, which would outline the specific requirements and standards the lessor must meet, along with any remedies for non-compliance.

What is the historical spending pattern for office space leasing by the Millennium Challenge Corporation?

The provided data focuses on a single contract. To understand historical spending patterns for office space leasing by the Millennium Challenge Corporation (MCC), one would need to analyze their procurement history over several fiscal years. This would involve querying databases for all contracts related to 'leased office space' or similar NAICS codes (like 531120) awarded by MCC. Analyzing this data would reveal trends in spending, the number and types of contracts awarded, average contract values, and potentially shifts in leasing strategies or locations over time.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Lessors of Real Estate › Lessors of Nonresidential Buildings (except Miniwarehouses)

Product/Service Code: LEASE/RENT FACILITIES › LEASE/RENTAL OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: MCC-13-RLP-0105

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1099 14TH ST NW STE 100L, WASHINGTON, DC, 20005

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $79,463,430

Exercised Options: $79,463,430

Current Obligation: $66,338,829

Actual Outlays: $1,471,950

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline