Redacted Justification 2PR0144.pdf

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 property or services will satisfy agency requirements. This one source is uniquely qualified as the space is immediately available and is already constructed to meet the agency’s requirements with no disruption or associated moving costs. The economic benefit to remaining in the space derives from the savings associated with relocation costs, disruption, and initial build out costs, which are not expected to be recovered through a Full and Open Competition.

4. DEMONSTRATION THAT THE PROPOSED CONTRACTOR'S UNIQUE

QUALIFICATIONS OR NATURE OF THE ACQUISITION REQUIRES THE USE OF

THE AUTHORITY CITED:

The space at San Patricio Office Center, 7 Tabonuco St, Guaynabo, Puerto Rico is already constructed to meet needs. A renewal is requested to support the agency’s missions and protect Government occupancy at the current location to allow time for the multiple long term space solutions to be completed.

According to the Cost Benefit Analysis (CBA) of the proposed renewal option term, attached hereto, an award to other than the current Lessor would require relocation of the entire requirement and would cause the agency to incur move and replication costs that would not be recovered through competition. The Government will save approximately $1,094,839.00 by remaining in place. The cost to move and replicate an already existing office considering the three separate housing solutions underway, would be excessive and not in the best interest of the Government.

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, an advertisement was posted on SAM.gov on 4/24/2023 until 5/8/2023 to identify any potential sites that could possibly meet needs. The advertisement yielded no expressions of interest from the public.

6. DEMONSTRATION BY THE CONTRACTING OFFICER THAT THE ANTICIPATED

COST TO THE GOVERNMENTWILL BE FAIR AND REASONABLE:

Market research was conducted on 3/21/2023 for Guaynabo, Puerto Rico. The market research revealed an average rate of $32.77 per RSF, fully serviced, with an adjusted market range from $25.00 to $40.00 per RSF, fully serviced (see attached market research spreadsheet).

Furthermore, the CBA shows a full Tenant Improvement Allowance of $2,826,240.98 and a Building Specific Amortized Capital (BSAC) allowance of $35.00 per ABOA SF for a total of $4,769,826.80, amortized over two (2) years at interest. The Government would also incur furniture moving costs of approximately $224,010.00 and voice and data moving costs of approximately $179,208.00 and likely one month of double rent during the move, or

$192,324.32. This equates to a total estimated relocation and replication cost of $5,365,369.12 if the Government were to relocate.

The cost of relocating using the lowest price market alternative of $25.00 per RSF exceeds the cost of remaining at their current location at the anticipated rental rate of per RSF.

The Government would see an estimated total cost savings of approximately $1,094,839.00 over the renewal term if were to remain in place. The proposed rental rate of per RSF is slightly above the market range of $25.00 to $40.00 per RSF but is considered to be fair and reasonable given the short term nature of the renewal.

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.

The table below compares the cost of remaining in place at an anticipated rental rate of per RSF with the cost of relocating at the lowest price market alternative rate of $25.00 per RSF.

The savings to the Government by remaining in place is an estimated $1,094,839.00 as demonstrated below and referenced in GSA’s Formal Cost Benefit Analysis Excel Document (attached).

7. DESCRIPTION OF MARKET RESEARCH CONDUCTED AND THE RESULTS:

Market research was conducted on 3/21/2023 for the Guaynabo market via Google search, cold calling records, and existing rent data. The market research was adjusted to reflect fully serviced Government lease conditions and the resulting market range is from $25.00 to $40.00 per RSF (see attached market research spreadsheet for details).

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

COMPETITION:

The current Lessor has been responsive throughout the term of the lease.

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

IN THE ACQUISITION:

No sources other than the incumbent Lessor expressed interest in this procurement.

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

OR OVERCOME ANY BARRIERS TO COMPETITION BEFORE ANY SUBSEQUENT

ACQUISITION:

The Government is close to awarding a new/replacing competitive action for 14,718 RSF, relocating 28,273 RSF to the GSA Center Federal Building once capital repairs are complete, and terminating 13,800 RSF which will relocate to a owned building. The Government will remain conscious of the effort to continuously encourage competition when practicable.

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 renewal for 56,791 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.

Certified By:

Nel Morales Vias Date Lease Contracting Officer and One Level Above LCO (2PRC)

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.

Prepared by:

Bena Parker Date Lease Contracting Officer (2PRC)

Concurred by:

Raffaela Battiloro Date Lease Acquisition Officer (2PR)

Jeannette Rios Date Leasing Director (2PR)

Reviewed by:

Leigh Erin S. Izzo Date Senior Assistant Regional Counsel (2L)

Approved by:

Warren F. Hall Date Competition Advocate (2L)