Department of the Navy awards $54.8M contract for new multifamily housing construction in Virginia

Contract Overview

Contract Amount: $42,573,726 ($42.6M)

Contractor: Archer Western Contractors, LLC

Awarding Agency: Department of Defense

Start Date: 2006-09-22

End Date: 2008-11-07

Contract Duration: 777 days

Daily Burn Rate: $54.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIXED PRICE

Sector: Construction

Official Description: BID ITEM 0001

Place of Performance

Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23511

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $42.6 million to ARCHER WESTERN CONTRACTORS, LLC for work described as: BID ITEM 0001 Key points: 1. Contract awarded via full and open competition, suggesting a robust bidding process. 2. Fixed-price contract type may offer cost certainty for the government. 3. The contract duration of 777 days indicates a significant construction project. 4. The contractor, Archer Western Contractors, LLC, has a history of federal awards. 5. Project located in Virginia, potentially impacting local construction workforce and economy. 6. NAICS code 236116 points to new multifamily housing construction, a specific construction sub-sector.

Value Assessment

Rating: good

The contract value of $54.8 million for new multifamily housing construction appears to be within a reasonable range for a project of this scale. Benchmarking against similar Department of the Navy housing projects would provide a more precise value-for-money assessment. The fixed-price nature of the contract suggests that the contractor bears the risk of cost overruns, which is generally favorable for the government. However, without detailed cost breakdowns or comparisons to private sector construction costs in the same region, a definitive value assessment is challenging.

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 5 bids suggests a competitive environment, which typically drives down prices and encourages innovation. The level of competition is a positive sign for price discovery and ensuring the government receives competitive pricing for the construction services.

Taxpayer Impact: The full and open competition process likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition award. Multiple bidders ensure that the government is not overpaying due to a lack of market alternatives.

Public Impact

Service members and their families in Virginia will benefit from new housing accommodations. The project delivers new multifamily housing construction services. The geographic impact is concentrated in Virginia, supporting local economic activity. The construction project will likely create jobs for the local workforce in the skilled trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for all project contingencies.
Dependence on a single contractor for the duration of the project introduces performance risk.
Construction projects are inherently subject to delays due to weather, material availability, or unforeseen site conditions.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Fixed-price contract type shifts cost overrun risk to the contractor.
The contractor, Archer Western Contractors, LLC, has experience in federal contracting.
Project addresses a clear need for military family housing.

Sector Analysis

This contract falls within the construction sector, specifically focusing on new multifamily housing. The construction industry is a significant part of the US economy, with federal contracts often supporting large-scale infrastructure and facilities. Comparable spending benchmarks would involve analyzing other federal housing construction projects, particularly those managed by the Department of Defense or other agencies like the Department of Housing and Urban Development, to assess cost-effectiveness and market rates for similar projects.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While this contract was awarded under full and open competition, there is no explicit information on subcontracting plans for small businesses. The impact on the small business ecosystem would depend on whether Archer Western Contractors, LLC voluntarily engages small businesses for specialized services or material supply during the construction phase.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer's representative (COR) from the Department of the Navy, ensuring compliance with contract terms and quality standards. Accountability measures are embedded in the fixed-price contract structure, with penalties or incentives potentially tied to performance milestones. Transparency is generally maintained through contract award databases, though detailed project-specific oversight reports may not always be publicly accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Military Housing Privatization Initiative
Department of Defense Family Housing
Construction Contracts
Multifamily Residential Building Construction

Risk Flags

Potential for schedule delays
Risk of cost overruns if contingencies are underestimated
Quality control during construction
Contractor performance risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $42.6 million to ARCHER WESTERN CONTRACTORS, LLC. BID ITEM 0001

Who is the contractor on this award?

The obligated recipient is ARCHER WESTERN CONTRACTORS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $42.6 million.

What is the period of performance?

Start: 2006-09-22. End: 2008-11-07.

What is the track record of Archer Western Contractors, LLC with federal contracts, particularly for housing construction?

Archer Western Contractors, LLC has a significant history of federal contracting. A review of federal procurement data reveals numerous awards to this contractor across various agencies, including the Department of Defense, Department of the Army, and Department of Veterans Affairs. Their portfolio includes a range of construction projects, with a notable presence in infrastructure, healthcare facilities, and indeed, housing projects. For instance, they have been awarded contracts for barracks, dormitories, and other residential facilities. This specific contract for multifamily housing in Virginia aligns with their demonstrated capabilities and experience in constructing residential structures for government entities. Their past performance on similar projects would be a key factor in the initial evaluation during the bidding process.

How does the $54.8 million contract value compare to similar multifamily housing construction projects by the Department of the Navy?

Benchmarking the $54.8 million contract value requires comparing it to similar Department of the Navy (DoN) multifamily housing projects in terms of size, scope, and location. Without access to a comprehensive database of all DoN housing construction contracts, a precise comparison is difficult. However, projects of this magnitude for new construction typically involve multiple buildings, extensive site work, and significant material and labor costs. Factors such as prevailing wage rates in Virginia, material costs at the time of award, and specific design requirements would influence the final price. Generally, a contract of this size for a substantial housing complex is not unusual for a federal agency undertaking such a project. Further analysis would involve examining the number of units constructed, square footage, and amenities to refine the value assessment.

What are the primary risks associated with this fixed-price contract for new multifamily housing construction?

The primary risks associated with this fixed-price contract, while generally favorable to the government, still exist. The main risk is that the contractor, Archer Western Contractors, LLC, may encounter unforeseen cost increases during construction that exceed their initial estimates. This could lead to pressure for change orders, potentially increasing the overall cost, or a risk of contractor default if they mismanaged their bid. Another risk is related to the quality of construction; a contractor focused on minimizing costs to maintain profit margins might compromise on materials or workmanship if oversight is not rigorous. Schedule delays are also a risk, which can arise from various factors like weather, supply chain disruptions, or labor shortages, potentially impacting the availability of housing for service members.

How effective is the 'full and open competition' process in ensuring value for money for this type of construction contract?

The 'full and open competition' process is generally considered highly effective in ensuring value for money for construction contracts like this one. By allowing all responsible sources to bid, it maximizes the pool of potential contractors, thereby increasing the likelihood of receiving competitive pricing. The presence of multiple bids, as indicated by the 5 bids received, further strengthens this effect by fostering price discovery and encouraging contractors to offer their best terms. This competitive pressure incentivizes contractors to be efficient, innovative, and cost-conscious to win the contract. While the fixed-price nature of the contract also contributes to cost certainty, the competitive bidding process is the foundational mechanism for achieving a fair and reasonable price from the outset.

What are the historical spending patterns for new multifamily housing construction by the Department of the Navy?

Historical spending patterns for new multifamily housing construction by the Department of the Navy (DoN) reveal a consistent investment in military family housing. The DoN manages a vast portfolio of housing assets and regularly undertakes new construction and renovation projects to meet housing needs and standards. Spending in this category can fluctuate year-to-year based on budget allocations, infrastructure priorities, and the lifecycle of existing housing stock. Major construction initiatives are often driven by strategic plans to modernize or expand housing capabilities. Analyzing historical data would show periods of higher or lower investment, influenced by factors such as congressional appropriations, economic conditions, and specific military base development plans. This particular $54.8 million contract represents one component of the DoN's ongoing commitment to providing adequate housing.

What are the implications of the 777-day contract duration on project management and taxpayer cost?

The 777-day duration (approximately 2.1 years) for this multifamily housing construction project has several implications. For project management, it necessitates robust planning, scheduling, and oversight to ensure timely completion and coordination of various construction phases. Longer durations can increase the complexity of managing resources, subcontractors, and potential changes. For taxpayers, a longer duration can mean sustained expenditure over a longer period, potentially increasing exposure to inflation or market fluctuations in material and labor costs, even within a fixed-price contract if contingencies are not well-managed. However, it also allows for a more methodical construction process, potentially reducing risks of rushed work or errors that could lead to costlier repairs later. The efficiency of the contractor in managing this timeline is crucial for delivering value.

Industry Classification

NAICS: Construction › Residential Building Construction › New Multifamily Housing Construction (except For-Sale Builders)

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N4008506R6055

Offers Received: 5

Pricing Type: FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Walsh Group Ltd., the

Address: 3715 NORTHSIDE PKWY BG 100 STE 550, ATLANTA, GA, 30327

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $42,573,726

Exercised Options: $42,573,726

Current Obligation: $42,573,726

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline