Department of the Navy awards $44.2M contract for construction of 150 rooms across two buildings in Hawaii

Contract Overview

Contract Amount: $44,206,153 ($44.2M)

Contractor: NAN Inc

Awarding Agency: Department of Defense

Start Date: 2009-08-17

End Date: 2012-07-16

Contract Duration: 1,064 days

Daily Burn Rate: $41.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THE WORK TO BE PERFORMED PROVIDES FOR BUILDINGS OF REINFORCED CONCRETE OR MASONRY CONSTRUCTION PROVIDING 88 ROOMS (P-749) AND 62 ROOMS (P-750) WITH SEMI-PRIVATE IN THE STANDARD 2 + 0 ROOM CONFIGURATION. BUILDING(S) WILL BE INTERCONNECTED THROUGH WALKWAYS AND SHALL NOT EXCEED FIVE STORIES IN HEIGHT WITH COMMUNITY AND SERVICE CORE AREAS CONSISTING OF LAUNDRY FACILITIES, LOUNGES, DUTY OFFICER AND BUNK ROOM, HOUSEKEEPING, VENDING AREA, AND PUBLIC RESTROOM. ANTITERRORISM FORCE PROTECTION (AT/FP) MEASURES INCLUDE THE REQUIRED STANDOFF DISTANCES TO EXISTING BUILDINGS IN THE AREA, STREETS, AND OFF-STREET PARKING, AS WELL AS, OTHER AT/FP REQUIREMENTS INCLUDING PROGRESSIVE COLLAPSE. SUSTAINABLE DESIGN PRINCIPLES WILL BE INTEGRATED INTO THE DESIGN, DEVELOPMENT, AND CONSTRUCTION OF THE PROJECT AND INCLUDE A MINIMUM LEADERSHIP IN ENERGY AND ENVIRONMENTAL DESIGN SILVER-LEVEL RATING CERTIFICATION FROM THE U.S. GREEN BUILDING COUNCIL.

Place of Performance

Location: M C B H KANEOHE BAY, HONOLULU County, HAWAII, 96863

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $44.2 million to NAN INC for work described as: THE WORK TO BE PERFORMED PROVIDES FOR BUILDINGS OF REINFORCED CONCRETE OR MASONRY CONSTRUCTION PROVIDING 88 ROOMS (P-749) AND 62 ROOMS (P-750) WITH SEMI-PRIVATE IN THE STANDARD 2 + 0 ROOM CONFIGURATION. BUILDING(S) WILL BE INTERCONNECTED THROUGH WALKWAYS AND SHALL NOT EXCEED FIV… Key points: 1. The contract focuses on reinforced concrete or masonry construction for buildings designed to house personnel, including community and service core areas. 2. Antiterrorism force protection measures are integrated into the design, addressing standoff distances and progressive collapse. 3. Sustainable design principles are a key component of the construction project. 4. The contract was awarded under full and open competition, suggesting a competitive bidding process. 5. The project duration of 1064 days indicates a significant construction undertaking. 6. The firm-fixed-price contract type aims to provide cost certainty for the government.

Value Assessment

Rating: fair

The total award amount of $44.2 million for the construction of two buildings totaling 150 rooms appears to be within a reasonable range for institutional construction projects of this scale. However, without specific details on the square footage, amenities, and complexity of the sustainable design and antiterrorism features, a precise value-for-money assessment is challenging. Benchmarking against similar military housing or barracks construction in Hawaii would provide a clearer picture of cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded using full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 9 bids suggests a healthy level of competition for this project, which generally leads to more competitive pricing and a wider range of technical solutions. The government likely benefited from multiple proposals to evaluate.

Taxpayer Impact: The full and open competition for this construction project is beneficial for taxpayers as it likely drove down costs through competitive bidding and encouraged contractors to offer their best value proposals.

Public Impact

Personnel stationed in Hawaii will benefit from new, modern housing facilities. The construction project will deliver two buildings with a total of 150 rooms, including essential community and service areas. The geographic impact is localized to the specific military installation in Hawaii where the buildings are being constructed. The construction project will likely create numerous jobs in the local Hawaii workforce, supporting skilled trades and related industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for construction delays impacting operational readiness.
Cost overruns due to unforeseen site conditions or material price fluctuations.
Ensuring compliance with stringent antiterrorism and sustainable design requirements.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Full and open competition likely resulted in competitive pricing.
Integration of sustainable design principles aligns with environmental goals.
Antiterrorism measures enhance force protection.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically for government facilities. The market for large-scale government construction projects is often characterized by significant competition among established firms. The Department of Defense is a major client in this sector, frequently awarding contracts for barracks, administrative buildings, and other infrastructure. Comparable spending benchmarks would typically be assessed based on per-square-foot costs for similar government construction in the region, factoring in specialized requirements like AT/FP and sustainability.

Small Business Impact

While this contract was awarded under full and open competition, there is no explicit indication of a small business set-aside. However, the prime contractor, NAN INC, may engage small businesses for subcontracting opportunities to fulfill specific construction trades or material supply needs. The impact on the small business ecosystem would depend on the extent to which NAN INC utilizes subcontracting and whether small businesses are competitively selected for these roles.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting and engineering departments, ensuring adherence to the contract terms, specifications, and schedule. Accountability measures would include performance reviews, site inspections, and payment milestones tied to progress. Transparency is generally maintained through contract award databases and public reporting, though specific project details might be limited due to security considerations. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Barracks Construction
Department of Defense Facilities
Antiterrorism Force Protection Construction
Sustainable Building Initiatives
Government Institutional Construction

Risk Flags

Potential for construction cost overruns.
Risk of project delays impacting operational readiness.
Ensuring compliance with complex AT/FP and sustainability standards.
Dependency on contractor performance and material availability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.2 million to NAN INC. THE WORK TO BE PERFORMED PROVIDES FOR BUILDINGS OF REINFORCED CONCRETE OR MASONRY CONSTRUCTION PROVIDING 88 ROOMS (P-749) AND 62 ROOMS (P-750) WITH SEMI-PRIVATE IN THE STANDARD 2 + 0 ROOM CONFIGURATION. BUILDING(S) WILL BE INTERCONNECTED THROUGH WALKWAYS AND SHALL NOT EXCEED FIVE STORIES IN HEIGHT WITH COMMUNITY AND SERVICE CORE AREAS CONSISTING OF LAUNDRY FACILITIES, LOUNGES, DUTY OFFICER AND BUNK ROOM, HOUSEKEEPING, VENDING AREA, AND PUBLIC RESTROOM. ANTITERRORISM FORCE PROTECTION (AT/FP) ME

Who is the contractor on this award?

The obligated recipient is NAN INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $44.2 million.

What is the period of performance?

Start: 2009-08-17. End: 2012-07-16.

What is the track record of NAN INC in completing similar large-scale government construction projects on time and within budget?

Assessing NAN INC's track record requires a review of their past performance on similar contracts. This would involve examining contract databases for projects of comparable size, scope, and complexity, particularly those with the Department of Defense or other federal agencies. Key metrics to evaluate include on-time completion rates, adherence to budget, quality of work, and any history of disputes or contract modifications. A detailed analysis would look for patterns in project delivery, client satisfaction feedback, and any performance ratings from previous government contracts. Without specific data on NAN INC's past projects, it is difficult to definitively assess their reliability for this particular $44.2 million construction award.

How does the per-room cost of this project compare to similar military barracks or housing construction in Hawaii or other high-cost regions?

The total award of $44.2 million for 150 rooms equates to approximately $294,667 per room. To benchmark this value, we would need to compare it against similar projects in Hawaii, known for its high construction costs, or other regions with comparable labor and material expenses. Factors such as square footage per room, included amenities (e.g., private bathrooms, common areas), the complexity of structural requirements (e.g., seismic, antiterrorism), and the level of sustainable design integration significantly influence per-room costs. A preliminary comparison suggests this figure might be within the expected range for high-cost areas with specialized requirements, but a definitive assessment requires detailed project specifications and market data for comparable projects.

What are the primary risk indicators associated with this specific construction contract, and how are they being mitigated?

Key risk indicators for this contract include the inherent complexities of large-scale construction, potential for unforeseen site conditions, fluctuations in material costs, and the demanding requirements for antiterrorism force protection (AT/FP) and sustainable design. The long duration (1064 days) also presents risks related to schedule slippage and potential cost escalation if not managed effectively. Mitigation strategies likely include robust project management by the Department of the Navy, detailed site investigations prior to construction, contingency planning for material costs, and stringent oversight of AT/FP and sustainability compliance. The firm-fixed-price contract type shifts some cost risk to the contractor, incentivizing efficient management.

How effective are the antiterrorism and sustainable design measures integrated into this project in meeting current DoD standards and long-term environmental goals?

The effectiveness of the AT/FP measures hinges on their specific implementation details, such as standoff distances, blast resistance, and progressive collapse resistance, which must align with current DoD Unified Facilities Criteria (UFC). Similarly, the success of sustainable design principles depends on the specific strategies employed (e.g., energy efficiency, water conservation, material selection) and their adherence to standards like LEED or DoD's Guiding Principles for Sustainable Buildings. While the contract mandates these elements, their ultimate effectiveness will be determined during the design finalization and construction phases, requiring rigorous review and inspection to ensure they meet or exceed DoD requirements and contribute meaningfully to long-term environmental sustainability.

What is the historical spending pattern for similar construction projects by the Department of the Navy in Hawaii over the past five years?

Analyzing historical spending patterns for similar construction projects by the Department of the Navy in Hawaii would involve examining contract awards for barracks, housing, and other institutional facilities over the last five years. This would reveal average contract values, typical project durations, and the range of costs per square foot or per room. Such an analysis would help determine if the $44.2 million award for 150 rooms is consistent with historical trends, considering inflation, market conditions, and any shifts in design requirements (e.g., increased focus on AT/FP or sustainability). Understanding these patterns provides context for the current contract's value and potential cost-effectiveness.

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: N6274209R1303

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 636 LAUMAKA ST, HONOLULU, HI, 01

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: $44,206,153

Exercised Options: $44,206,153

Current Obligation: $44,206,153

Contract Characteristics

Cost or Pricing Data: NO

Timeline