HUD's $63.6M Asset Manager contract for Area 2P awarded to Chronos Real Estate, LLC

Contract Overview

Contract Amount: $63,630,709 ($63.6M)

Contractor: Chronos Real Estate, LLC

Awarding Agency: Department of Housing and Urban Development

Start Date: 2010-06-01

End Date: 2016-03-31

Contract Duration: 2,130 days

Daily Burn Rate: $29.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 27

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ASSET MANAGER (AM) M&M III - AREA 2P

Place of Performance

Location: VIENNA, FAIRFAX County, VIRGINIA, 22182

State: Virginia Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $63.6 million to CHRONOS REAL ESTATE, LLC for work described as: ASSET MANAGER (AM) M&M III - AREA 2P Key points: 1. The contract value represents a significant investment in property management services. 2. Full and open competition suggests a potentially competitive bidding process. 3. The contract duration of 2130 days indicates a long-term need for these services. 4. The fixed-price contract type aims to control costs and provide budget certainty. 5. The award was made by the Department of Housing and Urban Development (HUD). 6. The contract falls under the Mortgage and Nonmortgage Loan Brokers NAICS code.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable contract data. The total award amount of $63.6 million over approximately six years suggests a substantial annual expenditure. However, without details on the scope of services, the number of assets managed, or the specific outcomes achieved, it is difficult to definitively assess value for money. Comparing this to other asset management contracts within HUD or similar agencies would provide better context for pricing and efficiency.

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 a bid. The presence of 27 bids suggests a robust level of interest and a competitive marketplace for these services. A higher number of bidders generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The extensive competition for this contract likely resulted in a more cost-effective outcome for taxpayers, as bidders vied to offer the most competitive pricing and terms.

Public Impact

The primary beneficiaries are likely the Department of Housing and Urban Development, which receives asset management services for its portfolio. The contract supports the management and disposition of housing assets, contributing to HUD's mission. The geographic impact is focused on Area 2P, likely within Virginia, as indicated by the 'SN' field. The contract supports the real estate services industry, potentially creating or sustaining jobs for asset managers and related professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes it difficult to assess the effectiveness of asset management.
The long contract duration could lead to complacency or reduced innovation if not actively managed.
Potential for cost overruns if the fixed-price contract does not adequately account for unforeseen market changes or asset issues.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
The fixed-price contract type provides cost certainty for the government.
A significant number of bids (27) indicates a healthy market and potential for strong contractor performance.

Sector Analysis

The real estate services sector, particularly asset management for government-owned or managed properties, is a specialized niche. This contract fits within the broader financial services and real estate industry. Comparable spending benchmarks would typically involve analyzing other government contracts for similar asset management services, considering factors like the number of properties managed, geographic scope, and the complexity of the assets.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. Furthermore, there is no explicit information regarding subcontracting plans or their impact on the small business ecosystem. Without this data, it's difficult to assess the contract's direct influence on small business participation.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officers and program managers within the Department of Housing and Urban Development. Accountability measures would be defined in the contract's statement of work and performance standards. Transparency is generally facilitated through contract award databases, though detailed performance reports may not always be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

HUD Asset Management Programs
Government Real Estate Management
Mortgage Servicing Contracts
Property Disposition Services

Risk Flags

Long contract duration may reduce flexibility.
Fixed-price nature could lead to contractor risk or government overpayment if market conditions change.

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $63.6 million to CHRONOS REAL ESTATE, LLC. ASSET MANAGER (AM) M&M III - AREA 2P

Who is the contractor on this award?

The obligated recipient is CHRONOS REAL ESTATE, LLC.

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 $63.6 million.

What is the period of performance?

Start: 2010-06-01. End: 2016-03-31.

What was the specific scope of services provided under this Asset Manager contract?

The specific scope of services for the ASSET MANAGER (AM) M&M III - AREA 2P contract, awarded to CHRONOS REAL ESTATE, LLC by the Department of Housing and Urban Development (HUD), would typically encompass a range of activities related to the management and disposition of real estate assets. This could include property inspections, maintenance coordination, leasing activities, financial management of properties, tenant relations, and preparing properties for sale or transfer. Given the NAICS code (522310 - Mortgage and Nonmortgage Loan Brokers), the assets managed might be related to foreclosed properties or properties within HUD's portfolio that require active management to preserve value and facilitate their return to the private market. The contract's duration of 2130 days (approximately 6 years) suggests a comprehensive and ongoing management responsibility.

How does the $63.6 million award compare to similar asset management contracts managed by HUD?

Comparing the $63.6 million award for the ASSET MANAGER (AM) M&M III - AREA 2P contract requires access to a broader dataset of HUD's asset management contracts. Without specific comparable data points, such as the number of assets managed, the geographic scope, or the duration of other contracts, a direct comparison is difficult. However, the total value suggests a significant portfolio of assets requiring management. HUD manages a vast array of housing programs, and the scale of this contract indicates it was likely for a substantial geographic area or a large number of properties. To provide a robust comparison, one would need to analyze the average contract value per asset managed, the average annual expenditure, and the performance outcomes across a range of similar HUD contracts awarded over a similar period.

What are the key performance indicators (KPIs) used to evaluate the contractor's performance?

Key Performance Indicators (KPIs) for an asset management contract like this are crucial for evaluating the contractor's effectiveness and ensuring value for money. While not explicitly detailed in the provided summary data, typical KPIs for such contracts often include metrics related to property preservation (e.g., vacancy rates, time to re-occupy), financial performance (e.g., rental income collected, operating expenses, net operating income), maintenance and repair responsiveness (e.g., average time to complete work orders, tenant satisfaction with repairs), and successful property disposition (e.g., time on market for sales, sale price achieved relative to market value). The contracting officer's representative (COR) would monitor these KPIs against established targets outlined in the contract's statement of work.

What is the historical spending trend for asset management services by HUD in this category?

Analyzing historical spending trends for asset management services by HUD in this category would require a review of procurement data over several fiscal years. The provided data point represents a single contract award from 2010 to 2016. To understand trends, one would need to aggregate spending on similar contracts, identify fluctuations in demand, and assess whether spending has increased or decreased over time. Factors influencing these trends could include changes in HUD's portfolio size (e.g., due to economic conditions leading to more foreclosures), shifts in government policy regarding asset management, and the overall budget allocated to HUD's programs. A trend analysis would help determine if this $63.6 million contract was an outlier or representative of typical spending levels.

What risks are associated with a long-term, fixed-price contract for asset management?

Long-term, fixed-price contracts for asset management, such as the ASSET MANAGER (AM) M&M III - AREA 2P contract (2130 days), carry specific risks. For the government, the primary risk is that the fixed price may become uncompetitive over time if market rates or the scope of work changes significantly, potentially leading to paying above fair market value. Conversely, if the contractor underestimates costs or faces unforeseen challenges, they might incur losses, potentially impacting service quality or leading to contract disputes. For the contractor, the risk lies in accurately forecasting all potential costs and market conditions over the contract's duration. Unexpected increases in maintenance, repair, or operational costs, or a decline in asset values, could erode profit margins. Effective contract management, including regular performance reviews and potential for contract modifications under specific circumstances, is essential to mitigate these risks.

Industry Classification

NAICS: Finance and Insurance › Activities Related to Credit Intermediation › Mortgage and Nonmortgage Loan Brokers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 27

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1199 S BELT LINE RD STE 105, COPPELL, TX, 75019

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $63,630,709

Exercised Options: $63,630,709

Current Obligation: $63,630,709

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS23F0009V

IDV Type: FSS

Timeline