2VA0944 - Redacted JOFOC.pdf

DocuSign Envelope ID: 6AD4A914-F9DC-4214-B4AB-F1E50DC44600

Revised 10-23-2023

Justification for Other Than Full and Open Competition, Succeeding Lease

U.S. General Services Administration

GSA Region 3

Public Buildings Service Real Estate Acquisition Division (PBS READ)

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

PROJECT NUMBER: 2VA0944

Agency Name: Department of Justice – United States Attorneys’ Office (DOJ USAO)

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

The General Services Administration currently leases 24,482 ABOA SF/29,333 Rentable Square Feet (RSF) of office space at The Truist Center, 919 E Main Street, Richmond, VA 23219 under lease number GS-03P-LVA12145 for the USAO. The current lease expires November 3, 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.

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

(INCLUDING ESTIMATED VALUE).

USAO submitted a continuing need letter on August 6, 2023 for 29,333 rentable square feet of office and related space. To satisfy USAO mission requirements, the facility must be within a walkable distance of the Lewis F. Powell, Jr. Federal Courthouse in Richmond, VA.

This requirement is for 24,482 ABOA SF/29,333 RSF of space for a 10-year, 5-year firm term and 1, 5-year renewal option to commence on November 4, 2025. The estimated cost of this lease is $24.03 per rentable square feet per year for an annual cost of $704,871.99 and a total contract value of $10,573,079.85. The current rental rate is $25.11/RSF. The delineated area is within the Central Business District (CBD) of Richmond, VA. No tenant improvement work is required at the incumbent location, except for a paint and carpet refresh.

There is currently no vacant Federal Space available. However, USAO is expected to relocate their office space requirement into the nearby federally-owned Lewis F. Powell Courthouse Annex in the future. This backfill project is expected to take place around 2030.

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.

It is in the best interest of the Government to remain at the current location. Award to other than the current Lessor would require relocation of the entire requirement and would cause USAO to incur move and replication costs that would not be recovered through competition. Relocation costs are estimated to be $280,725.00. Additionally, this allows the Government to make use of existing tenant improvements, avoiding replication costs of $3,611,369.00. These existing tenant improvements include specialized private offices, conference rooms, a law library, secure interview rooms, storage and processing rooms, an IT server room, and other FSL II security measures. A cost-benefit analysis was completed following the procedures set forth in GSAR 570.402-6. The cost of relocating USAO to an alternate location based on market data exceeds the cost of remaining at 919 E Main Street. The total savings to the Government is $3,270.873.00.

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 4, 2023 for 32 days. In addition, PBS and national broker contractor CBRE conducted market research using CoStar. No expressions of interest were received.

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

GOVERNMENT WILL BE FAIR AND REASONABLE.

Recent market surveys conducted by PBS and CBRE in Richmond, VA showed the rental rate within the delineated area ranges from $22.00 to $26.00 per RSF, according to CoStar and REIS market data.

Therefore, the proposed rental rates for this succeeding lease of $24.03/RSF, are within the current market range for this submarket and are deemed fair and reasonable by the GSA Lease Contracting Officer.

7. DESCRIPTION OF MARKET RESEARCH CONDUCTED AND THE RESULTS.

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.

On July 5, August 10, November 8, and December 14, 2023, PBS and CBRE conducted market research using CoStar and identified 4 potentially acceptable locations (3 plus the incumbent) that might meet the agency’s needs within the delineated area. These included the incumbent, 901 E Cary Street, 1111 E Main Street, and 1051 E Cary Street. Another building, 11 S 10th Street, was also located within the delineated area but did not meet USAO’s requirement for contiguous space located on the 3rd floor or higher. In addition, PBS posted an advertisement conforming to GSAR 570.402-2 on the Contract Opportunities domain of SAM.gov website on December 4, 2023. The incumbent Lessor did not respond to the advertisement, but is expected to retain GSA/USAO as a tenant. No other parties submitted Expressions of Interest in response to the Pre-Solicitation Notice.

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

The Truist Center, 919 E Main Street, Richmond

VA 23219

GSA incumbent Lease LVA12145 and CoStar data

$24.03/RSF

One James Center, 901 E Cary Street, Richmond, VA 23219

CoStar $22.00/RSF

No sources expressed an interest in writing in the acquisition.

Three James Center, 1051 E Cary Street, Richmond, VA 23219 CoStar $25.10/RSF

The Bank of America Center, 1111 E Main Street, Richmond, VA 23219

CoStar Withheld

Figure 1: Market Research Comparables

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

USAO and the GSA Field Office have indicated that the performance of the incumbent Lessor has been satisfactory. When operations and maintenance problems arose in the past, the Lessor has been quick to satisfactorily remediate issues. There are no known issues with the building’s lighting and plumbing systems, and the building appears to be fully compliant with ABAAS requirements.

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

ACQUISITION.

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 29,333 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 2/20/2024

Cathleen Ryer, Lease Contracting Officer (LCO)

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.