Hensel Phelps Construction Co. awarded $61.7M for Navy pre-construction services, with 6 bidders
Contract Overview
Contract Amount: $61,730,442 ($61.7M)
Contractor: Hensel Phelps Construction CO
Awarding Agency: Department of Defense
Start Date: 2011-11-21
End Date: 2014-03-11
Contract Duration: 841 days
Daily Burn Rate: $73.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: FIXED PRICE INCENTIVE
Sector: Construction
Official Description: P-750 PRE-CONSTRUCTION SERVICES
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92135
Plain-Language Summary
Department of Defense obligated $61.7 million to HENSEL PHELPS CONSTRUCTION CO for work described as: P-750 PRE-CONSTRUCTION SERVICES Key points: 1. Contract value represents a significant investment in early-stage project planning for naval facilities. 2. The fixed-price incentive contract structure suggests a focus on cost control with performance bonuses. 3. Competition level indicates a healthy market for these specialized pre-construction services. 4. Contract duration of 841 days points to a complex and lengthy planning phase. 5. Geographic focus on California suggests specific regional infrastructure needs. 6. The absence of small business set-asides warrants further examination of subcontracting opportunities.
Value Assessment
Rating: good
The contract value of $61.7 million for pre-construction services appears reasonable given the 841-day duration and the complexity implied by the fixed-price incentive structure. Benchmarking against similar large-scale pre-construction contracts for federal facilities would provide a more precise value assessment. The number of bidders (6) suggests a competitive environment that likely contributed to a fair price.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, with six bidders vying for the opportunity. This level of competition is generally positive, indicating that multiple qualified firms were interested and capable of performing the required services. A robust competitive process typically leads to better price discovery and a wider range of innovative solutions.
Taxpayer Impact: The full and open competition ensures that taxpayer dollars are being used efficiently by fostering a market-driven price. It minimizes the risk of overpayment and maximizes the potential for obtaining high-quality services at a competitive rate.
Public Impact
The Department of the Navy benefits from expert planning and design services to ensure future construction projects meet operational requirements. This contract supports the development of critical naval infrastructure, enhancing national security capabilities. The primary geographic impact is in California, where the construction projects will be located. The contract likely supports a specialized workforce in the architecture, engineering, and construction management fields.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if incentive targets are not met effectively.
- Risk of schedule delays impacting downstream construction phases.
- Dependence on a single large contractor for critical early-stage planning.
Positive Signals
- Fixed-price incentive contract encourages cost efficiency.
- Full and open competition suggests a strong market for these services.
- Experienced contractor likely brings valuable expertise to the project.
Sector Analysis
This contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on pre-construction services. This sector is vital for developing and maintaining infrastructure across various government agencies. The market for such services is competitive, with established firms offering specialized expertise in project planning, cost estimation, and constructability reviews. The contract value of $61.7 million is substantial, indicating a significant project scope.
Small Business Impact
The contract was not set aside for small businesses, and the data does not indicate specific subcontracting requirements. This suggests that the primary award went to a large prime contractor. Further investigation into the contractor's subcontracting plan would be necessary to determine the extent of small business participation and its impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Navy program office. Accountability measures are embedded within the fixed-price incentive contract structure, which links contractor performance to financial outcomes. Transparency is generally maintained through contract award databases and reporting requirements, though specific project details may be sensitive.
Related Government Programs
- Naval Facilities Engineering Command (NAVFAC) Contracts
- Department of Defense Construction Projects
- Federal Pre-Construction Services
- Large-Scale Infrastructure Development
Risk Flags
- Fixed-price incentive contract requires careful monitoring of cost targets.
- Long contract duration increases exposure to market fluctuations and potential delays.
- Lack of explicit small business set-aside may limit broader economic impact.
Tags
construction, department-of-defense, department-of-the-navy, california, pre-construction-services, full-and-open-competition, fixed-price-incentive, large-contract, infrastructure, naval-facilities
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $61.7 million to HENSEL PHELPS CONSTRUCTION CO. P-750 PRE-CONSTRUCTION SERVICES
Who is the contractor on this award?
The obligated recipient is HENSEL PHELPS CONSTRUCTION CO.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $61.7 million.
What is the period of performance?
Start: 2011-11-21. End: 2014-03-11.
What is the track record of Hensel Phelps Construction Co. with federal contracts, particularly within the Department of Defense?
Hensel Phelps Construction Co. has a significant history of performing federal contracts, including numerous projects for the Department of Defense. Their experience spans various construction types and complexities, often involving large-scale infrastructure and facilities. Analyzing their past performance on similar fixed-price incentive contracts would provide insight into their ability to manage costs and meet performance targets effectively. A review of their contract history can reveal patterns in project delivery, adherence to schedules, and overall client satisfaction within the federal sector.
How does the $61.7 million contract value compare to similar pre-construction service contracts awarded by the Navy or other DoD components?
The $61.7 million award for pre-construction services is a substantial figure, suggesting a project of considerable scale and complexity. To benchmark its value, it should be compared against other large pre-construction contracts awarded by the Department of the Navy or other Department of Defense entities over the past five to ten years. Factors such as contract duration, scope of services (e.g., design development, cost estimating, scheduling, risk assessment), and geographic location are crucial for a fair comparison. Without specific comparable data, it's difficult to definitively state if this represents exceptional value, but the number of bidders suggests a competitive market that likely yielded a fair price.
What are the primary risks associated with a fixed-price incentive (FPI) contract for pre-construction services, and how are they mitigated in this case?
Fixed-price incentive contracts carry inherent risks for both the government and the contractor. For the government, the risk lies in the contractor potentially sacrificing quality or scope to meet cost targets, or conversely, the government incurring higher costs if targets are exceeded and shared. For the contractor, the risk is in underestimating costs and not achieving the target profit. In this case, the FPI structure aims to mitigate these by incentivizing the contractor to control costs while sharing in any savings or overruns above certain thresholds. Effective oversight, clear definition of performance metrics, and robust cost tracking are crucial mitigation strategies employed by the government.
What is the expected impact of this contract on the development and readiness of naval facilities in California?
This contract is crucial for the Department of the Navy's infrastructure development and readiness in California. Pre-construction services lay the groundwork for successful, cost-effective, and timely execution of major construction projects. By ensuring thorough planning, accurate cost estimation, and identification of potential challenges early on, this contract helps to de-risk future construction efforts. This ultimately contributes to the modernization and maintenance of vital naval bases and facilities, ensuring they are equipped to support operational missions and personnel.
How has federal spending on pre-construction services evolved over the past decade, and does this contract align with historical trends?
Federal spending on pre-construction services has generally trended upwards over the past decade, driven by increased infrastructure investment needs and a greater emphasis on upfront planning to avoid costly project overruns. This contract, valued at $61.7 million over 841 days, aligns with the trend of awarding significant contracts for comprehensive planning phases, especially for large-scale defense or infrastructure projects. Historical data would show if the average contract size, duration, and competition levels for similar services have increased, indicating a strategic shift towards more robust pre-construction efforts across federal agencies.
What does the competition level (6 bidders) suggest about the market for specialized pre-construction services for the Department of the Navy?
The fact that six bidders competed for this pre-construction services contract indicates a healthy and competitive market for these specialized services within the Department of the Navy. A higher number of bidders generally suggests that there are multiple capable firms interested in government work, which can lead to better pricing, innovation, and a wider selection of qualified contractors. This level of competition reduces the government's reliance on any single provider and increases the likelihood of securing high-quality services at a fair market price, ultimately benefiting taxpayers.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
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: N6247311R2817
Offers Received: 6
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 18850 VON KARMAN AVE STE 100, IRVINE, CA, 47
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $61,730,442
Exercised Options: $61,730,442
Current Obligation: $61,730,442
Subaward Activity
Number of Subawards: 42
Total Subaward Amount: $45,570,446
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2011-11-21
Current End Date: 2014-03-11
Potential End Date: 2014-03-11 00:00:00
Last Modified: 2014-09-29
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