Redacted OTFO - 2DC0635_Redacted.pdf

Justification for Other Than Full and Open Competition, Succeeding Lease

U.S. General Services Administration

GSA Region 11

National Capital Region

Office of Real Estate Delivery / Lease Execution Division / Public Building Services

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

PROJECT NUMBER: 2DC0635

LEASE NUMBER: GS-11P-LDC12646

Agency Name: Civilian Board of Contract Appeals (CBCA)

1. NATURE AND/OR DESCRIPTION OF ACTION BEING APPROVED.

The General Services Administration currently leases 48,724 ANSI/BOMA Office Area square feet (ABOA SF) / 53,460 rentable square feet (RSF) of office space at 1800 M Street, NW in Washington, DC under lease number GS-11P-LDC12646; of this leased space, the CBCA currently occupies 41,202 ABOA SF/45,206 RSF. The remainder of the space is occupied by the Medicaid and CHIP Payment and Access Commission who will continue to occupy the remainder of the space under a separate lease. The current lease expires January 31, 2025. Approval is requested to negotiate a succeeding lease with the incumbent Lessor without full and open competition for continued occupancy at this leased location. The procedures for pursuing a succeeding lease are detailed in GSAR 570.402: Succeeding Leases (48 C.F.R. 570.402).

2. DESCRIPTION OF THE SUPPLIES OR SERVICES REQUIRED TO MEET THE AGENCY’S NEEDS

(INCLUDING ESTIMATED VALUE).

For this requirement, CBCA submitted a continuing need letter on June 9, 2022 for 38,201 ABOA SF/42,201 RSF (later updated to 41,202 ABOA SF/45,206 RSF) of space for a new 15-year, 10-year firm term to commence on February 1, 2025. To satisfy the CBCA’s mission requirements, the facility must meet the following requirements:

● Building must be within one half (1/2) walkable mile of a Metro Station.

● Above ground, contiguous space is required. Space on the second (2nd) floor or higher is required.

● Clear and unobstructed ceiling height of minimum 8’0” clear is required.

● Column spacing must be 20’ minimum.

● Offered space must be able to accommodate specialized Courtrooms/area and Clerk’s office area, which should measure by the following:

o Two Courtrooms 26 feet x 30 feet o One Courtroom 26 feet x 34 feet o Clerk's Ofc (Public) 20 feet x 30 feet o Clerk's Ofc (Private office) 14 feet x 17 feet

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● Offered building must have a loading dock or other loading area that meets agency requirements.

Multistory buildings must have a freight elevator.

The estimated cost of this lease is per RSF for years 1 through 10, and per RSF for years 11 through 15 for a total contract value of . (Note: The incumbent offered a full-service rate of per RSF during the firm term, which included the full TI and BSAC Allowances, and per ABOA SF respectively (total of ). The Independent Government Estimate (IGE), however, shows the cost of required improvements to be in total TI and in BSAC. As such, the full-service rate was stripped of the fully apportioned TI and BSAC per RSF and recalculated using only the TI needed for the incumbent location, which effectively reduced the offered full-service rate by per RSF SF from to .) The delineated area is as follows with Washington, DC:

● West: Rock Creek & Potomac Parkway NW to Ohio Drive SW;

● South: Independence Avenue SW to east Basin Drive SW (along Potomac River) to Maine Street

SW (continuing along the Potomac River) to Water Street SW to 1st Avenue SW to D Street SW to 2nd Avenue SW to E Street SW to 4th Avenue SW to D Street SW to 5th Avenue SW (along the Anacostia River);

● East: To 2nd Street SW to Q Street SW to Half Street SW to I Street SW to South Capitol Street SW to Independence Avenue SW & SE to 1St Street SE to Constitution Avenue NE & NW to 3rd Street NW to Massachusetts Avenue NE around Columbus Circle, continuing onto Massachusetts Avenue NE to 2nd Street NE to K Street NE to 3rd Street NE to M Street NE to Florida Avenue crossing and along the B & O railroad tracks;

● North: R Street NE & NW to New Jersey Avenue NW to P Street NW to ending at Rock Creek & Potomac Parkway NW.

There is no vacant Federal Space available.

3. IDENTIFICATION OF STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION.

41 U.S.C. 3304(a)(1): Only one responsible source and no other supplies or services will satisfy agency requirements. This statutory authority is implemented through GSAR 570.402. In accordance with GSAR 570.402, use of the sole source authority is appropriate where it is determined that award to any other offeror would result in substantial duplication of costs to the Government that are not expected to be recovered through competition.

4. DEMONSTRATION THAT THE PROPOSED CONTRACTOR’S UNIQUE QUALIFICATIONS OR

NATURE OF THE ACQUISITION REQUIRES THE USE OF THE AUTHORITY CITED.

GSAR 570.402-5 allows for negotiation with the incumbent Lessor when a cost-benefit analysis shows that the Government cannot expect to recover relocation and duplication costs through competition.

Award to other than the current Lessor would require relocation of the entire requirement and would cause CBCA to incur move and replication costs that would not be recovered through competition.

Relocation and other non-construction related costs are estimated to be (Furniture Cost =

; Move Cost = ; Duplicate Rent During Move = ; and IT/Telecom Cost and RWA Fee = ). Additionally, remaining at the current location allows the Government to make use of existing tenant improvements and other building construction improvements, avoiding replication costs of . A cost-benefit analysis was completed following the procedures set forth in GSAR 570.402-6. The cost of relocating CBCA using the low-cost quote exceeds the cost of remaining at 1800 M Street, NW in Washington, DC. The total savings to the Government is

5. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED FROM AS

MANY POTENTIAL SOURCES AS IS PRACTICABLE.

Per the requirements of GSAR 570.402, the GSA Lease Contracting Officer placed an advertisement on the Contracting Opportunities domain of SAM.gov on December 20, 2022, for 21 days. GSA received eight (8) responses to the advertisement, including one from the incumbent, which are listed in further detail in Sections 7 and 9 below. Due to the time passed between the initial advertisement and approval of this document, an additional advertisement was posted to SAM.gov on March 20, 2024, allowing an opportunity for other interested parties to submit. This advertisement indicated that parties that responded to the initial advertisement did not have to submit another expression of interest (EOI), unless they had material changes to their EOIs. One (1) new EOI was received and another one (1) was received from a party that had submitted a response to the original advertisement.

6. DEMONSTRATION BY THE CONTRACTING OFFICER THAT THE ANTICIPATED COST TO THE

GOVERNMENT WILL BE FAIR AND REASONABLE.

Recent market surveys conducted by Public Properties in Washington, DC, showed the rental rate within the delineated area ranges from to per RSF, with an average asking rental rate of per RSF. This data is supported by market research derived from CoStar and local market sources.

Therefore, in accordance with FAR 6.303-2(b)(7), the proposed rental rates for this succeeding lease of /RSF (as adjusted for the lower TIA and BSAC necessary) is below the current market range for this submarket and determined to be fair and reasonable by the GSA Lease Contracting Officer.

7. DESCRIPTION OF MARKET RESEARCH CONDUCTED AND THE RESULTS.

On March 1, 2023 (updated February 2024), Public Properties conducted market research using the CoStar Database and outreach to local and national real estate brokers and identified 44 potentially acceptable locations (forty-three plus the incumbent) that might meet the agency’s needs within the delineated area. In addition, PBS posted an advertisement conforming to GSAR 570.402-2 on the Contract Opportunities domain of SAM.gov website on December 20, 2022. Due to the amount of time that passed between the initial advertisement and approval of this document, an additional advertisement was posted to SAM.gov on March 20, 2024 allowing an opportunity for other interested parties to submit.

One additional party submitted in response to this advertisement and a second building (

) submitted an updated rental rate. The incumbent Lessor’s EOI, submitted in response to the original advertisement, indicated that the rate would be per RSF, which included full TI and BSAC Allowances. The EOI submitted for , indicated that their estimated rental rate was anticipated to be . Following review of the EOIs, the offeror for this party was called to clarify their rate and asked to provide a projected rental rate per RSF; during the conversation the building representative stated that a rate of per RSF is what would be equal to.

See Figure 1 below for the results of the market research and SAM.gov advertisement, including the incumbent.

Address Source [EOI/CoStar, etc.] Asking Full-Service Rental Rate

EOI

EOI

EOI (2nd Ad)

EOI

EOI

EOI

EOI

EOI (2nd Ad)

CoStar

CoStar

CoStar

CoStar

CoStar

CoStar

Figure 1: Market Research Comparables

8. OTHER FACTS SUPPORTING USE OF OTHER THAN FULL AND OPEN COMPETITION.

A succeeding lease action for the CBCA will provide for continued, uninterrupted housing to serve its mission. The most recent property inspection showed the space to be well maintained and in good condition and that the current Lessor is very responsive. Furthermore, this succeeding lease will allow the Government to avoid a short-term extension or a potential holdover.

9. LIST OF SOURCES, IF ANY, THAT EXPRESSED, IN WRITING, AN INTEREST IN THE

ACQUISITION.

– 1800 M Street, NW [incumbent]

10. STATEMENT OF ACTIONS, IF ANY, THE AGENCY MAY TAKE TO REMOVE OR OVERCOME

ANY BARRIERS TO COMPETITION BEFORE ANY SUBSEQUENT ACQUISITION.

There are no systemic barriers to competition. If the agency has a continuing need for space upon lease expiration, GSA will follow all authorities, regulations, and policies applicable to lease acquisition. Should there be remaining useful life in the Government’s tenant improvements, the Government will consider the cost of moving from the existing location, and the cost to build out new space when deciding whether to undergo a competitive action.

Additionally, objective scrutiny will be given to the customer agency’s mission and security requirements (if applicable) to eliminate unnecessary agency space requirements that may be deemed unduly restrictive.

11. CONTRACTING OFFICER CERTIFICATION.

By signature on this Justification for Other than Full and Open Competition, the GSA Lease Contracting Officer certifies that the award of a succeeding lease of 45,206 RSF is in the Government’s best interest and that this Justification is accurate and complete to the best of the GSA Lease Contracting Officer’s knowledge and belief.

_ ____________________________________ Date_____________________ Kevin Terry, Lease Contracting Officer

12. PREPARER’S TECHNICAL CERTIFICATION.

I certify that the supporting data used to form the basis of this Justification is complete and accurate to the best of my knowledge and belief.

_ ____________________________________ Date______________________ Bradford Seifert, Broker Contractor

Concurred By:

____________________________________ Date______________________ Glenn Harvey, LED Director

Concurred By:

___________________________________ Date______________________ Marisol Medina, Lease Acquisition Officer

Concurred By:

______________________________ Date______________________ Office of Regional Counsel

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5/8/2024

5/8/2024

5/13/2024

5/15/2024

5/15/2024

Concurred By:

__________________________________ Date______________________ Miranda Webster Acting Director, ORED

Concurred By:

_________________________________ Date______________________ Michael Spriggs, Competition Advocate

Approved By:

_ _________________________________ Date______________________ Melanie Gilbert, Regional Commissioner for PBS (HCA)

Revised 12-06-2022

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5/17/2024

5/17/2024

5/17/2024