Grunley Construction awarded $166.8M for DC building modernization, a significant investment in federal infrastructure

Contract Overview

Contract Amount: $166,793,352 ($166.8M)

Contractor: Grunley Construction CO., Inc.

Awarding Agency: General Services Administration

Start Date: 2003-08-31

End Date: 2011-12-31

Contract Duration: 3,044 days

Daily Burn Rate: $54.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: PHASE II, STATE PLACE MODERNIZATION

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20407

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $166.8 million to GRUNLEY CONSTRUCTION CO., INC. for work described as: PHASE II, STATE PLACE MODERNIZATION Key points: 1. The contract value represents a substantial commitment to upgrading federal facilities. 2. Competition dynamics for this large-scale project are crucial for ensuring taxpayer value. 3. Performance history and potential risks associated with large construction projects warrant close monitoring. 4. This project fits within the broader context of federal building maintenance and modernization efforts. 5. The sector positioning highlights the government's reliance on established construction firms for major infrastructure work.

Value Assessment

Rating: fair

The contract value of $166.8 million for building modernization is substantial. Benchmarking this against similar large-scale federal construction projects is challenging without more granular data on scope and specific upgrades. However, the duration of the contract (over 8 years) suggests a phased approach, which can sometimes lead to cost efficiencies if managed well, but also carries risks of cost overruns if not tightly controlled. The firm-fixed-price structure aims to cap costs, but the total expenditure indicates a significant investment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely considered. This approach is generally favored for large projects as it promotes a competitive environment, potentially leading to better pricing and a wider selection of qualified contractors. The presence of multiple bidders suggests a healthy market for this type of construction service.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of securing the best possible price and quality for the services rendered, minimizing the risk of inflated costs.

Public Impact

Federal employees and the public will benefit from modernized and potentially more efficient federal buildings in the District of Columbia. The services delivered include commercial and institutional building construction, focusing on modernization. The geographic impact is concentrated in the District of Columbia. The project likely supported a significant number of construction jobs, contributing to the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration increases risk of scope creep and cost escalation.
Large contract value may attract fewer small business participants.
Construction projects are inherently subject to unforeseen site conditions and material cost fluctuations.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition suggests a robust bidding process.
Award to an established contractor like Grunley Construction may indicate a track record of successful project completion.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this area is critical for maintaining and upgrading government facilities. Comparable spending benchmarks would involve looking at other large-scale federal building modernization projects managed by agencies like GSA, which often involve multi-million dollar investments over several years.

Small Business Impact

The contract was not specifically set aside for small businesses, and the data indicates no explicit small business participation. For a contract of this magnitude, large prime contractors like Grunley Construction are typical. However, opportunities for small businesses may exist through subcontracting, depending on the prime contractor's strategy and federal subcontracting requirements, which are not detailed here.

Oversight & Accountability

Oversight for this contract would typically fall under the General Services Administration's Public Buildings Service, which is responsible for managing federal buildings. Accountability measures would include contract milestones, performance reviews, and adherence to the firm-fixed-price terms. Transparency is generally facilitated through contract award databases, though detailed project progress and specific oversight activities may not always be publicly accessible.

Related Government Programs

Federal Building Modernization Programs
GSA Public Buildings Service Contracts
Infrastructure Investment and Jobs Act Projects
Commercial Construction Contracts

Risk Flags

Long contract duration
Potential for cost overruns
Scope creep risk
Market volatility in construction materials

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $166.8 million to GRUNLEY CONSTRUCTION CO., INC.. PHASE II, STATE PLACE MODERNIZATION

Who is the contractor on this award?

The obligated recipient is GRUNLEY CONSTRUCTION CO., INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $166.8 million.

What is the period of performance?

Start: 2003-08-31. End: 2011-12-31.

What is Grunley Construction Co., Inc.'s track record with similar large-scale federal building modernization projects?

Grunley Construction Co., Inc. has a significant history of working on large-scale construction projects, including those for federal agencies. While specific details on past modernization projects of this exact scale and type are not provided in this data snippet, their experience in commercial and institutional building construction suggests a capacity to handle complex federal contracts. A deeper dive into their past performance ratings, project completion history, and any past disputes or contract modifications would be necessary for a comprehensive assessment of their track record for this specific type of work.

How does the awarded amount compare to the estimated cost or market rates for similar modernization projects in Washington D.C.?

The awarded amount of $166.8 million for building modernization is substantial. Without specific details on the scope of work, square footage, and the exact nature of the modernization (e.g., HVAC upgrades, structural repairs, interior renovations), it is difficult to provide a precise market rate comparison. However, large-scale federal construction projects in high-cost areas like Washington D.C. often command significant budgets. The firm-fixed-price nature of the contract suggests the government aimed to lock in costs, but the final expenditure relative to the initial estimate and market benchmarks would require a detailed cost-benefit analysis of the project's deliverables.

What are the primary risks associated with a contract of this duration (3044 days) and value?

Contracts spanning over 8 years (3044 days) and valued at $166.8 million carry inherent risks. Key risks include potential cost escalation due to inflation or unforeseen material price increases, even with a firm-fixed-price contract, if scope changes occur. There's also the risk of scope creep, where the project's objectives expand beyond the original agreement, leading to delays and increased costs. Contractor performance degradation over a long period, changes in government requirements or priorities, and potential delays due to site conditions or regulatory hurdles are also significant concerns. Effective project management, change control, and regular performance monitoring are crucial to mitigate these risks.

How effective is the firm-fixed-price contract type in managing costs for long-term federal construction projects?

The firm-fixed-price (FFP) contract type is generally intended to provide cost certainty for the government, as the contractor assumes most of the risk for cost overruns. For long-term projects, FFP can be effective if the scope of work is well-defined and stable. However, for lengthy construction projects, the risk of unforeseen issues (e.g., material price volatility, unexpected site conditions) can lead contractors to build in higher contingencies, potentially increasing the initial price. Furthermore, if significant changes to the scope are required, contract modifications can become complex and costly. While FFP aims for cost control, its effectiveness is highly dependent on the initial scope definition and the contractor's ability to manage risks over the project's extended duration.

What is the historical spending trend for building modernization by the General Services Administration (GSA)?

Historical spending data for GSA's building modernization efforts reveals a consistent and substantial investment in federal real estate. GSA manages a vast portfolio of government buildings, and modernization is a continuous necessity to ensure safety, efficiency, and compliance with modern standards. Annual spending fluctuates based on budget allocations, infrastructure needs, and specific large-scale projects. Over the past decade, GSA's capital investments in modernization have often run into billions of dollars annually, reflecting the aging federal building stock and the ongoing need to upgrade facilities across the country. This specific $166.8 million contract represents one component of that larger, ongoing federal commitment.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Solicitation ID: GS-11P-05-MK-C-3004

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 15020 SHADY GROVE RD STE 500, ROCKVILLE, MD, 08

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

Financial Breakdown

Contract Ceiling: $166,793,352

Exercised Options: $166,793,352

Current Obligation: $166,793,352

Contract Characteristics

Multi-Year Contract: Yes

Timeline