HUD's $42.3M Asset Manager contract for Hawaii awarded to PEMCO, Limited, spanning 2010-2016

Contract Overview

Contract Amount: $42,322,487 ($42.3M)

Contractor: Pemco, Limited

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: $19.9K/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 2A

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96826

State: Hawaii Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $42.3 million to PEMCO, LIMITED for work described as: ASSET MANAGER (AM) M&M III - AREA 2A Key points: 1. The contract utilized a firm-fixed-price structure, aiming to control costs over its duration. 2. Awarded under full and open competition, suggesting a broad market engagement. 3. The contract duration of 2130 days (approx. 5.8 years) indicates a long-term need for asset management services. 4. The North American Industry Classification System (NAICS) code 522310 points to mortgage and nonmortgage loan brokerage services. 5. The contract was awarded as a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract vehicle. 6. The contract's value of over $42 million suggests a significant scope of work in managing housing assets.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable contracts from the same period. The firm-fixed-price nature suggests an attempt to lock in costs, but the total value over nearly six years indicates substantial resource allocation. Without details on the specific assets managed or the outcomes achieved, a definitive value-for-money assessment is difficult. The contract's duration and total value, however, suggest a significant operational requirement for the Department of Housing and Urban Development (HUD).

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 a bid. The presence of 27 bids suggests a competitive marketplace for these services. A high number of bidders generally supports price discovery and can lead to more favorable pricing for the government, although the specific pricing outcomes are not detailed here.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

The primary beneficiaries are likely the Department of Housing and Urban Development (HUD) and potentially recipients of housing assistance programs managed through these assets. The services delivered involve the management of mortgage and nonmortgage loans, likely related to distressed or foreclosed properties. The geographic impact is focused on Hawaii, as indicated by the 'ST' (State) code 'HI'. The contract supports the government's role in managing its housing asset portfolio and ensuring the stability of housing markets.

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 duration of the contract could lead to vendor complacency if not actively managed.
Potential for cost overruns if the scope of work expanded beyond initial projections, despite fixed-price structure.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Firm-fixed-price contract type helps to establish cost certainty.
The contract duration suggests a stable, long-term need that was met by a single award.

Sector Analysis

The mortgage and nonmortgage loan brokerage sector involves entities that facilitate the origination and servicing of loans. This contract falls within the financial services industry, specifically focusing on asset management for government-held or government-backed loans. Comparable spending in this sector can vary widely depending on the volume of distressed assets or the scale of government housing programs. HUD's role in managing such assets is critical for market stability and program integrity.

Small Business Impact

The provided data indicates that small business participation (sb) was false, and there was no specific small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses, and larger firms likely dominated the bidding process. Subcontracting opportunities for small businesses are not detailed but would depend on the prime contractor's strategy.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Housing and Urban Development's internal procurement and program management offices. Accountability measures would be tied to the terms of the firm-fixed-price contract and delivery order requirements. Transparency is generally facilitated through contract award databases, though detailed performance reporting may be internal.

Related Government Programs

HUD Single Family Mortgage Insurance Programs
FHA Loan Servicing Contracts
Government National Mortgage Association (Ginnie Mae) Programs
Distressed Asset Stabilization Program (DASP)

Risk Flags

Contract Duration
Lack of Performance Metrics
Limited Public Detail on Scope

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $42.3 million to PEMCO, LIMITED. ASSET MANAGER (AM) M&M III - AREA 2A

Who is the contractor on this award?

The obligated recipient is PEMCO, LIMITED.

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 $42.3 million.

What is the period of performance?

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

What was the specific nature of the 'mortgage and nonmortgage loans' managed under this contract?

The contract, identified by NAICS code 522310 (Mortgage and Nonmortgage Loan Brokers), likely involved the management of distressed or foreclosed residential and potentially commercial properties acquired by HUD. This could include tasks such as property maintenance, marketing, sales, and financial administration of these assets to minimize losses for the government and ensure responsible disposition. The 'ASSET MANAGER (AM) M&M III' designation suggests a program focused on managing mortgage and mortgage-related assets.

How did the firm-fixed-price (FFP) structure impact the government's financial exposure compared to other contract types?

A firm-fixed-price (FFP) contract establishes a ceiling price that the contractor must not exceed, regardless of the actual costs incurred. This shifts most of the cost risk from the government to the contractor. For the government, FFP provides the highest degree of cost certainty, making budgeting more predictable. However, if the contractor underestimates costs or faces unforeseen challenges, they may absorb losses, potentially impacting their motivation or long-term viability. In this case, HUD benefited from predictable spending over the contract's life, assuming PEMCO, Limited, successfully managed the assets within the agreed price.

What does the number of bids (27) suggest about the competitiveness of the asset management market for HUD in Hawaii during that period?

Receiving 27 bids for this contract indicates a highly competitive market for mortgage and nonmortgage loan asset management services, at least during the solicitation period. This suggests that multiple firms possessed the capability and interest to undertake such work for HUD in Hawaii. A robust competition typically benefits the government by driving down prices and encouraging innovation, as contractors vie to offer the most attractive terms and demonstrate superior capabilities to win the award.

Were there any performance issues or contract modifications reported for this contract?

Based on the provided summary data, specific details regarding performance issues or contract modifications are not available. Standard contract management would involve monitoring performance against deliverables and potentially issuing modifications for scope changes, extensions, or adjustments. Without access to the contract's full history or performance reports, it's impossible to ascertain if any significant issues or changes occurred during its 2130-day duration.

How does this contract's value compare to other similar asset management contracts awarded by HUD or other agencies?

Comparing this $42.3 million contract requires context on the scale and type of assets managed. HUD manages a vast portfolio, including single-family and multifamily properties, as well as mortgage-backed securities. Contracts for asset management can range from tens of millions to hundreds of millions of dollars, depending on the volume of assets, geographic scope, and complexity of services required. Without specific benchmarks for Hawaii or similar programs, it's difficult to definitively state if this value is high or low, but it represents a substantial commitment for managing a specific portfolio within that state.

What is the significance of this contract being awarded as a 'Delivery Order'?

Being awarded as a 'Delivery Order' implies that this contract was likely issued under a pre-existing Indefinite Delivery/Indefinite Quantity (IDIQ) contract vehicle. IDIQ contracts allow agencies to procure supplies or services on an as-needed basis over a set period. A delivery order specifies the exact quantity, price, and delivery schedule for a particular task or requirement within the broader IDIQ framework. This approach provides flexibility for the agency to order services as needs arise, while having established terms and conditions with the contractor.

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: 1632 S KING ST STE 100, HONOLULU, HI, 96826

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

Financial Breakdown

Contract Ceiling: $42,337,177

Exercised Options: $42,337,177

Current Obligation: $42,322,487

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS23F0033V

IDV Type: FSS

Timeline