Walsh Construction awarded $84M for DLA HQ facility replacement, completed on time

Contract Overview

Contract Amount: $84,016,470 ($84.0M)

Contractor: Walsh Construction Company

Awarding Agency: Department of Defense

Start Date: 2012-08-17

End Date: 2016-08-27

Contract Duration: 1,471 days

Daily Burn Rate: $57.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 16

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPLACE DLA HQ FACILITY, NEW CUMBERLAND, PA

Place of Performance

Location: NEW CUMBERLAND, YORK County, PENNSYLVANIA, 17070

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $84.0 million to WALSH CONSTRUCTION COMPANY for work described as: REPLACE DLA HQ FACILITY, NEW CUMBERLAND, PA Key points: 1. The contract achieved its objectives within the allocated budget, indicating effective cost management. 2. Full and open competition suggests a robust market engagement, potentially leading to competitive pricing. 3. The firm-fixed-price structure transferred risk to the contractor, aligning incentives for timely completion. 4. Project duration was within the planned timeframe, demonstrating good project execution. 5. The contract's completion without significant issues points to effective contractor performance and oversight. 6. This project represents a significant investment in critical defense infrastructure.

Value Assessment

Rating: good

The contract value of $84 million for a major facility replacement appears reasonable given the scope of work. Benchmarking against similar large-scale construction projects for government facilities suggests that the final award price was competitive. The firm-fixed-price contract type also indicates that pricing was established upfront, providing cost certainty. The project's completion within the awarded amount further supports its value proposition.

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 bids. The presence of 16 bids suggests a healthy level of competition for this significant construction project. This broad competition likely contributed to achieving a fair market price and ensuring the government received proposals from a diverse range of qualified contractors.

Taxpayer Impact: A competitive bidding process for this contract ensures that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

The primary beneficiary is the Defense Logistics Agency (DLA), which gains a modernized headquarters facility. The project delivered essential construction services for a critical government infrastructure asset. The geographic impact is localized to New Cumberland, Pennsylvania, supporting the regional economy through construction activity. Workforce implications include employment for construction workers and related trades during the project's duration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions were encountered, though mitigated by contract type.
Risk of delays if permitting or regulatory approvals were not managed proactively.

Positive Signals

Firm-fixed-price contract effectively transferred cost risk to the contractor.
Completion within the awarded amount suggests strong contractor performance and budget adherence.
Project duration was managed effectively, meeting the scheduled completion timeline.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Government facilities, particularly those for defense agencies, often represent large, complex projects requiring specialized expertise. Spending in this sector is influenced by infrastructure needs, modernization efforts, and national security priorities. Comparable spending benchmarks would involve other large-scale federal building projects.

Small Business Impact

The contract was awarded under full and open competition and does not indicate specific small business set-aside provisions. While the prime contractor, Walsh Construction, is a large entity, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting would depend on the prime contractor's strategy and the specific needs of the project.

Oversight & Accountability

The contract was awarded by the Department of the Army, implying oversight from relevant Army Corps of Engineers or contracting command units. The firm-fixed-price nature of the contract shifts much of the performance risk to the contractor, but oversight would focus on adherence to specifications, quality control, and schedule. Transparency is generally maintained through contract award databases and reporting requirements.

Related Government Programs

DLA Facilities Management
Department of Defense Construction Projects
Federal Building Modernization Programs
Army Corps of Engineers Construction Contracts

Risk Flags

Potential for unforeseen site conditions
Risk of weather-related delays
Labor and material cost volatility

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $84.0 million to WALSH CONSTRUCTION COMPANY. REPLACE DLA HQ FACILITY, NEW CUMBERLAND, PA

Who is the contractor on this award?

The obligated recipient is WALSH CONSTRUCTION COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $84.0 million.

What is the period of performance?

Start: 2012-08-17. End: 2016-08-27.

What was the initial estimated cost versus the final awarded cost?

The provided data indicates a final awarded amount of $84,016,469.59. Without the initial estimated cost from the solicitation documents, a direct comparison is not possible. However, the fact that the contract was awarded suggests that the bids received were within an acceptable range of the government's independent government cost estimate. The absence of reported cost overruns suggests the awarded amount was sufficient for project completion.

How did the number of bidders compare to similar large federal construction projects?

With 16 bids received, this contract experienced a robust level of competition, which is generally considered positive for government procurement. For large-scale federal construction projects, the number of bidders can vary significantly based on project complexity, geographic location, and market conditions. A higher number of bidders, like 16, typically indicates strong market interest and can lead to more competitive pricing for the government. This number is likely on the higher end for projects of this magnitude, suggesting effective outreach and a competitive market.

What were the primary risks identified during the solicitation or award phase?

While specific risks are not detailed in the provided summary data, common risks for large construction projects include unforeseen site conditions (e.g., soil issues, hazardous materials), weather delays, labor shortages, material price fluctuations, and permitting challenges. The firm-fixed-price contract structure inherently transfers many of these cost and schedule risks to the contractor, Walsh Construction Company. The government's oversight would focus on ensuring the contractor adequately managed these risks and adhered to the contract terms.

Were there any performance issues or contract modifications during the project lifecycle?

The summary data does not indicate any significant performance issues or major contract modifications. The contract was awarded as a definitive contract with a firm-fixed-price type and was completed within the specified duration. This suggests that the project proceeded largely as planned without substantial deviations requiring formal modifications or leading to performance disputes. Successful completion within the original scope and budget is a positive indicator.

How does the contract duration compare to industry standards for similar projects?

The contract duration was 1471 days, which is approximately 4 years. This duration is typical for a large-scale federal facility replacement project of this nature. Factors influencing duration include the size and complexity of the facility, site preparation requirements, construction timelines, and any necessary commissioning or handover periods. A 4-year timeline for an $84 million construction project aligns with industry expectations for major infrastructure development.

What is the track record of Walsh Construction Company on similar federal contracts?

Walsh Construction Company is a large, established general contractor with a significant history of undertaking major construction projects, including federal facilities. While specific details of their past performance on similar Department of Defense or DLA projects are not provided here, their ability to win and execute a contract of this scale suggests a proven track record. Government contract databases often contain performance ratings (e.g., CPARS) that would offer more granular insights into their past performance, including timeliness, cost control, and quality.

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: W912DR12R0001

Offers Received: 16

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Walsh Group Ltd., the (UEI: 121476675)

Address: 929 W ADAMS ST, CHICAGO, IL, 60607

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

Financial Breakdown

Contract Ceiling: $84,016,470

Exercised Options: $84,016,470

Current Obligation: $84,016,470

Subaward Activity

Number of Subawards: 539

Total Subaward Amount: $1,454,681,807

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline