VA awards $318M hospital build-out contract to Brasfield & Gorrie LLC for Florida facility

Contract Overview

Contract Amount: $318,479,500 ($318.5M)

Contractor: Brasfield & Gorrie LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2010-08-31

End Date: 2018-01-30

Contract Duration: 2,709 days

Daily Burn Rate: $117.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PACKAGE 4, HOSPITAL BUILD OUT

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32814

State: Florida Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $318.5 million to BRASFIELD & GORRIE LLC for work described as: PACKAGE 4, HOSPITAL BUILD OUT Key points: 1. Contract value represents a significant investment in healthcare infrastructure. 2. The firm fixed-price contract type suggests a defined scope and cost control. 3. A long performance period indicates a complex, multi-year project. 4. The award was made under full and open competition, implying a robust bidding process. 5. The project's success hinges on effective construction management and adherence to timelines. 6. Geographic concentration in Florida may indicate regional healthcare needs or strategic planning.

Value Assessment

Rating: good

The contract value of $318.5 million for a hospital build-out is substantial, reflecting the scale and complexity of constructing a major healthcare facility. Benchmarking this against similar large-scale hospital construction projects would provide a clearer picture of its value for money. The firm fixed-price nature of the contract suggests that the contractor assumed significant cost risk, which can be a positive indicator of value if the final cost aligns with initial projections. However, without detailed cost breakdowns or comparisons to industry-standard construction costs per square foot for healthcare facilities, 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 four bidders suggests a competitive environment for this significant construction project. A higher number of bidders generally leads to more competitive pricing and a wider range of technical solutions, which is beneficial for the government. The fact that it was competed openly implies that the VA sought the best value through a transparent process.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that is likely to have driven down costs and ensured the selection of a qualified contractor capable of delivering the project efficiently.

Public Impact

Veterans in Florida will benefit from improved healthcare facilities. The contract supports the delivery of comprehensive medical services through new infrastructure. The project's geographic impact is concentrated in Florida, addressing regional healthcare demands. Construction activities will likely create numerous jobs in the skilled trades and related industries in Florida.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if project scope expands beyond initial fixed-price agreement.
Risk of construction delays impacting service delivery timelines.
Dependence on the contractor's ability to manage complex logistics and supply chains.
Ensuring compliance with stringent healthcare facility building codes and regulations.
Potential for unforeseen site conditions impacting construction costs and schedule.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established contractor suggests a degree of confidence in their capabilities.
Full and open competition likely resulted in a competitive price.
Long-term nature of the contract allows for phased development and integration of services.
Investment in healthcare infrastructure aligns with VA's mission to serve veterans.

Sector Analysis

The healthcare construction sector is a significant segment of the broader construction industry, characterized by specialized requirements, stringent regulations, and high project values. This contract falls within the Commercial and Institutional Building Construction category, specifically tailored for healthcare facilities. The market for healthcare construction is driven by factors such as an aging population, advancements in medical technology, and the need for updated or expanded facilities. The $318.5 million award is substantial, placing it among major infrastructure projects within this sector. Comparable spending benchmarks would typically involve analyzing the cost per square foot or per bed for similar hospital construction projects across the US.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large-scale infrastructure project, it is unlikely that small businesses would be the primary awardees for the prime contract. However, the prime contractor, Brasfield & Gorrie LLC, will likely engage small businesses as subcontractors for various specialized services and material supply. The extent of small business subcontracting will be a key factor in assessing the contract's impact on the small business ecosystem. Further analysis would require reviewing the subcontracting plan, if available.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Veterans Affairs' contracting officers and project managers, ensuring adherence to contract terms, quality standards, and timelines. Given the scale and duration, regular progress reviews, site inspections, and financial audits are expected. Transparency is usually facilitated through contract award databases and reporting requirements. The Inspector General's office within the VA would have jurisdiction to investigate any allegations of fraud, waste, or abuse related to this contract.

Related Government Programs

VA Medical Facility Construction
Healthcare Infrastructure Projects
Large-Scale Construction Contracts
Department of Veterans Affairs Procurement

Risk Flags

Potential for cost escalation beyond fixed price due to unforeseen circumstances.
Risk of project delays impacting veteran access to healthcare services.
Contractor performance and quality control are critical for facility longevity.
Ensuring compliance with evolving healthcare building codes and standards.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $318.5 million to BRASFIELD & GORRIE LLC. PACKAGE 4, HOSPITAL BUILD OUT

Who is the contractor on this award?

The obligated recipient is BRASFIELD & GORRIE LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $318.5 million.

What is the period of performance?

Start: 2010-08-31. End: 2018-01-30.

What is the track record of Brasfield & Gorrie LLC in completing large-scale healthcare construction projects for the federal government?

Brasfield & Gorrie LLC is a well-established construction firm with a significant portfolio of large-scale projects, including healthcare facilities. While specific federal contract history requires detailed database searches, their general reputation suggests experience with complex projects. For federal contracts, their track record would be assessed based on past performance evaluations, on-time delivery, adherence to budget, and quality of work. The VA's selection of this firm implies a positive assessment of their past performance, but a deeper dive into their specific federal project history, including any past issues or commendations, would provide a more comprehensive understanding of their reliability for this significant hospital build-out.

How does the awarded amount of $318.5 million compare to the average cost of similar hospital construction projects in Florida or nationally?

The $318.5 million award for a hospital build-out is a substantial figure, indicative of a large and complex facility. To benchmark this value, one would typically compare the cost per square foot or cost per bed against national and regional averages for hospital construction. For instance, national averages for hospital construction can range widely, from $300 to over $1,000 per square foot, depending on the complexity, location, and specific services offered. Similarly, cost per bed can range from hundreds of thousands to over a million dollars. Without specific details on the size (square footage) and bed capacity of the facility being built, a precise comparison is difficult. However, the magnitude of the award suggests it is in line with major healthcare infrastructure investments.

What are the primary risk indicators associated with a project of this magnitude and duration (2709 days)?

Projects of this scale and duration carry inherent risks. Key indicators include potential for scope creep, where the project's requirements expand beyond the initial agreement, leading to cost overruns despite the firm fixed-price contract. Construction delays are another significant risk, stemming from unforeseen site conditions, labor shortages, supply chain disruptions, or permitting issues, all of which can impact the operational readiness of the facility. Furthermore, managing a large workforce and multiple subcontractors over several years presents logistical and coordination challenges. Ensuring adherence to evolving healthcare regulations and technological standards throughout the construction period also poses a risk. Finally, the financial stability and management capacity of the prime contractor and its key subcontractors are critical risk factors.

What is the expected effectiveness of this contract in improving healthcare services for veterans in Florida?

The effectiveness of this contract in improving healthcare services for veterans in Florida hinges on several factors. Primarily, the new hospital build-out is expected to increase capacity, potentially reduce wait times, and offer advanced medical technologies and specialized services that may not be available at current facilities. Its success will be measured by its ability to meet the healthcare demands of the veteran population in its service area, provide high-quality care, and integrate seamlessly with existing VA healthcare networks. The strategic location and design of the facility will also play a role in accessibility and patient experience. Ultimately, the contract's effectiveness will be evaluated based on improved health outcomes, patient satisfaction, and the overall accessibility and quality of care delivered.

How does historical spending on similar VA hospital construction projects compare to this award?

Historical spending on VA hospital construction projects can vary significantly based on the size, scope, and location of each facility, as well as the economic conditions at the time of award. The $318.5 million award for this Florida hospital build-out is a substantial investment. To compare it historically, one would need to analyze past VA hospital construction contracts, adjusting for inflation and project complexity. For example, major VA medical center expansions or new hospital constructions in recent years have often been awarded in the hundreds of millions of dollars. This contract appears to be within the range of significant capital investments the VA makes to modernize and expand its healthcare infrastructure, reflecting a continued commitment to providing facilities that meet the evolving needs of veterans.

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: VA10109RP0206

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3021 7TH AVE S, BIRMINGHAM, AL, 35233

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

Financial Breakdown

Contract Ceiling: $318,479,500

Exercised Options: $318,479,500

Current Obligation: $318,479,500

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline