HUD awards $90.4M contract for Michigan and Ohio residential property management to Michaelson Connor & Boul

Contract Overview

Contract Amount: $90,395,783 ($90.4M)

Contractor: Michaelson Connor & Boul

Awarding Agency: Department of Housing and Urban Development

Start Date: 2005-07-01

End Date: 2007-06-30

Contract Duration: 729 days

Daily Burn Rate: $124.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: M&M SERVICES FOR SF REO PROPERTIES IN THE STATES OF MICHIGAN AND OHIO

Place of Performance

Location: PHILADELPHIA, PHILADELPHIA County, PENNSYLVANIA, 19107

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $90.4 million to MICHAELSON CONNOR & BOUL for work described as: M&M SERVICES FOR SF REO PROPERTIES IN THE STATES OF MICHIGAN AND OHIO Key points: 1. Contract awarded on a firm-fixed-price basis, indicating defined costs for services. 2. The contract duration of 729 days suggests a medium-term need for these services. 3. Awarded by the Department of Housing and Urban Development (HUD), focusing on residential property management. 4. The contract was not competed, raising questions about potential cost efficiencies and market fairness. 5. The North American Industry Classification System (NAICS) code 531110 points to lessors of residential buildings and dwellings. 6. The base award amount is $12.4 million, with the total award reaching over $90 million.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without comparable sole-source awards for similar services in the specified regions. The significant difference between the base award ($12.4M) and the total award ($90.4M) suggests substantial potential for task order growth or option exercise, which warrants closer scrutiny. The firm-fixed-price structure provides cost certainty for the government, but the lack of competition makes it difficult to assess if the pricing represents optimal value for money compared to a competitive scenario.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential bidders. Sole-source awards are typically justified when only one responsible source can provide the required services. Without a competitive process, it is difficult to ascertain the number of interested parties or the potential for a more robust price discovery mechanism. This approach may limit opportunities for other qualified contractors and potentially lead to higher costs than if the contract had been competed.

Taxpayer Impact: For taxpayers, a sole-source award means there is a reduced likelihood of benefiting from competitive pricing that could drive down costs. The government may be paying a premium due to the absence of market pressure from multiple bidders.

Public Impact

The primary beneficiaries are the residents of HUD-managed properties in Michigan and Ohio, who will receive property management services. Services delivered include the management and maintenance of residential buildings leased by HUD. The geographic impact is focused on the states of Michigan and Ohio. The contract supports the operational workforce of Michaelson Connor & Boul, potentially including property managers, maintenance staff, and administrative personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for a significant contract value raises concerns about potential overpricing and reduced efficiency.
Sole-source awards can limit opportunities for small businesses and other qualified contractors to participate in federal contracts.
The substantial increase from the base award to the total award necessitates careful monitoring of contract performance and spending.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government, mitigating the risk of cost overruns for defined services.
Awarding to an established entity like Michaelson Connor & Boul may indicate a reliance on proven performance and expertise in property management.
The contract addresses a clear need for managing HUD's residential properties, ensuring housing stability for residents.

Sector Analysis

The contract falls within the real estate and property management sector, specifically focusing on residential leasing and management services. This sector is characterized by a mix of large property management firms and smaller, specialized operators. HUD's role as a lessor or manager of properties often involves complex operational requirements, including maintenance, tenant relations, and compliance. Comparable spending benchmarks for large-scale residential property management contracts can vary widely based on location, property type, and service scope.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The sole-source nature of the award further limits the direct inclusion of small businesses through competitive bidding. The impact on the small business ecosystem is likely minimal unless Michaelson Connor & Boul voluntarily engages small businesses as subcontractors for specialized services.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Housing and Urban Development's contracting and program management offices. Accountability measures would be tied to the performance standards outlined in the contract's statement of work. Transparency is limited due to the sole-source nature of the award; however, contract award data is publicly available. The Inspector General for HUD would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

HUD Public Housing Management
HUD Multifamily Housing Programs
Federal Housing Administration (FHA) Property Disposition
General Services Administration (GSA) Real Estate Services

Risk Flags

Sole-source award
Potential for cost overruns due to lack of competition
Limited transparency in contractor selection

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $90.4 million to MICHAELSON CONNOR & BOUL. M&M SERVICES FOR SF REO PROPERTIES IN THE STATES OF MICHIGAN AND OHIO

Who is the contractor on this award?

The obligated recipient is MICHAELSON CONNOR & BOUL.

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $90.4 million.

What is the period of performance?

Start: 2005-07-01. End: 2007-06-30.

What is the track record of Michaelson Connor & Boul with HUD or similar federal agencies?

Information regarding Michaelson Connor & Boul's specific track record with HUD or other federal agencies is not detailed in the provided data. However, their selection for a sole-source award of this magnitude suggests they possess capabilities and potentially prior experience deemed sufficient by HUD for managing residential properties. A deeper dive into federal procurement databases (like SAM.gov or FPDS) would be necessary to ascertain their past performance ratings, previous contract awards, and any reported issues or successes with government contracts. Understanding their history would provide context for the current award's justification and potential risks.

How does the per-unit cost of managing these properties compare to industry benchmarks?

The provided data does not include specific details on the number of units managed or the breakdown of costs per unit, making a direct per-unit cost comparison impossible. The total award of $90.4 million over approximately two years for properties in Michigan and Ohio represents a significant investment. To benchmark effectively, one would need to know the total number of units or properties managed, the types of services included (e.g., maintenance, leasing, administration), and the specific geographic sub-markets within Michigan and Ohio. Without this granular data, assessing the cost-effectiveness on a per-unit basis against industry standards remains speculative.

What are the primary risks associated with a sole-source award of this size?

The primary risks associated with a sole-source award of this size include potential lack of cost competitiveness, reduced incentive for the contractor to innovate or optimize services, and the absence of market validation for the chosen provider's capabilities and pricing. Taxpayers may bear a higher cost than in a competitive scenario. Furthermore, reliance on a single source can create vulnerability if the contractor experiences performance issues, financial instability, or fails to meet evolving requirements. The government's leverage in negotiating changes or addressing deficiencies may also be diminished compared to a competitive environment.

What is the expected effectiveness of Michaelson Connor & Boul in managing these HUD properties?

The expected effectiveness of Michaelson Connor & Boul hinges on their demonstrated capabilities in residential property management, particularly for government-affiliated portfolios. HUD's decision to award this contract sole-source implies an assessment that the contractor can effectively manage the properties, maintain them to required standards, and ensure compliance with HUD regulations. Effectiveness will be measured by key performance indicators such as property condition, tenant satisfaction, lease-up rates, and operational efficiency. Without specific performance metrics from past contracts or a competitive evaluation, assessing their projected effectiveness relies heavily on HUD's internal due diligence and the contractor's reputation and prior experience.

How does this contract's value compare to historical HUD spending on property management in these states?

The provided data does not offer historical spending figures for HUD property management in Michigan and Ohio, making a direct comparison difficult. The $90.4 million award over two years is substantial and suggests a significant portfolio of properties or a comprehensive scope of services. To assess its historical context, one would need to analyze past HUD contracts for similar services in these specific states, considering factors like the number of properties managed, the duration of previous contracts, and inflation. This analysis would reveal whether this award represents an increase, decrease, or stable level of spending for HUD's property management needs in the region.

What are the implications of the 'PA' task order type for this contract?

The 'PA' designation likely refers to a specific type of task order or contract modification, possibly indicating 'Procurement Action' or a similar administrative classification within HUD's contracting system. Without a definitive key for HUD's internal codes, its precise meaning is unclear. However, task orders generally define the specific work, deliverables, and funding for a particular segment of a larger contract. If 'PA' signifies a specific type of action, it could relate to the initial award, a modification, or a specific phase of service delivery. Understanding the exact meaning of 'PA' would clarify how this specific award fits into the broader contract structure and its implications for service execution and funding.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Lessors of Real Estate › Lessors of Residential Buildings and Dwellings

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5312 BOLSA AVE STE 200, HUNTINGTON BEACH, CA, 47

Business Categories: Category Business, Not Designated a Small Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $94,117,649

Exercised Options: $94,117,649

Current Obligation: $90,395,783

Timeline