2.23.26 REDACTED_LMI01257(JOFOC)__Redacted.pdf
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- Solicitation number
- 2MI0374
About this file
Summary
This is a Justification for Other Than Full and Open Competition (JOFOC) document submitted by the General Services Administration (GSA) for lease renewal under Lease Number LMI17991 (Project Number 2MI0374). GSA seeks to renew a 5-year lease renewal option with a 3-year firm commitment beginning March 16, 2026, for approximately 18,597 rentable square feet (17,974 ABOA) of office space currently occupied by an undisclosed federal agency. The existing lease expires on March 15, 2026. The renewal is justified under 41 U.S.C. 253(c)(1) authority, citing cost-prohibitiveness and operational disruption of relocating the agency during the renewal term.
The anticipated renewal rate was not explicitly disclosed in the document due to redactions, but GSA conducted market research using CoStar data showing comparable triple-net properties in the delineated area with rates in a specific range (redacted), which when converted to fully-serviced rates account for tenant improvements and move costs. GSA determined the proposed renewal rate falls within market range and substantially below relocation costs. GSA posted a solicitation on SAM.gov to solicit competing offers, receiving no responses. The justification emphasizes GSA's priority to achieve rental savings while supporting the PBS Commissioner's initiative and notes that a formal market survey will be conducted during the long-term replacement procurement process scheduled during the renewal period. Approvals were obtained from multiple review levels between May 9 and May 30, 2024.
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5. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED FROM
AS MANY POTENTIAL SOURCES AS IS PRACTICABLE.
After discussion with the GSA Property Management office, it was confirmed that the location is acceptable to meet the housing needs of the agency for the renewal period. An ad was also posted on SAM.gov to solicit offers from interested parties other than the incumbent and no responses were received. With that additional information it has been determined that inserting the renewal is in the best interest of the government. The long-term procurement to be conducted during the term of this renewal will consider all buildings that fall within the yet to be determined delineated area.
6. DEMONSTRATION BY THE CONTRACTING OFFICE THAT THE ANTICIPATED COST TO
THE GOVERNMENT WILL BE FAIR AND REASONABLE.
The current rate for this location is . The anticipated rate for the renewal in the current location is per RSF. CoStar market research provided only two similar properties in the delineated area, showing rates between $ per RSF, both of which were triple net. A typical triple net lease is one in which the tenant is responsible for all of the property’s operating expenses, therefore tax and operating rates were added to generate fully service rates. The fully serviced market range is estimated to be between and per RSF. This CoStar market range doesn’t factor in tenant improvement (TI) or move costs. TI was added in the chart below for comparison, the cost of which would bring the estimated rate at an alternate location to per RSF.
The anticipated rate of per RSF includes which along with the shorter-term lease commitment, accounts for a higher rate than the current market research reflects. Negotiations will also aim to bring the rate down closer to the current market range. Based on this information, the anticipated cost for this renewal period falls close to market range and well below the cost to move to an alternative location, and therefore should be found to be fair and reasonable.
7. DESCRIPTION OF MARKET RESEARCH CONDUCTED AND THE RESULTS.
A formal market survey was not conducted for this lease renewal as moving the agency for the term of this renewal would be cost prohibitive and disruptive to the agency but will be conducted
Current Location Alternate Location
Shell Rent
Operation Rent* (*as currently escalated)
Tenant Improvements
Total Annual Rent during the long-term replacement procurement that will be conducted during the renewal period.
An ad was posted on SAM.gov to solicit offers from interested parties other than the incumbent and no responses were received.
8. OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN
COMPETITION.
In order to comply with the PBS Commissioner’s initiative to save taxpayer dollars through rental savings we have been prioritizing our procurements based on the overall value of the contract and the potential for rental savings. In situations where the space currently occupied has been confirmed by the GSA Property Manager to be capable of meeting the government's continued needs and agencies continued mission need Region 5 is renewing the lease based on the small financial risk to the government. Moving actions forward through renewals will allow the region to focus on deals with higher financial impact, realign our expiring workload in a phased manner and realize the organization's goal of longer-term strategic planning.
9. LISTS OF SOURCES, IF ANY THAT EXPRESSED, IN WRITING, AN INTEREST IN THE
ACQUISITION.
Not Applicable
10. STATEMENT OF ACTIONS, IF ANY, THE AGENCY MAY TAKE TO REMOVE OR
OVERCOME ANY BARRIERS TO COMPETITION BEFORE ANY SUBSEQUENT
ACQUISITION.
Through continued focus on longer term strategic planning with our clients and negotiating longer lease terms GSA will be able to better manage our inventory and reduce the need for non-competitive lease renewals.
11. CONTRACTING OFFICER CERTIFICATION
I, the Lease Contracting Officer, certify that the above information is accurate and complete to the best of my knowledge.
Prepared by:
Date
Leasing Specialist
Reviewed and concurred by:
Supervisory Contracting Officer
Branch Manager
Lease Policy and Program Branch
Division Director
Regional Counsel
Regional Competition Advocate
Approved by:
Regional Head of Contracting Activity
File details come from the government source that posted it. Updated .