SLAT-level Memo_redacted.pdf

SINGLE/SOLE SOURCE JUSTIFICATION DOCUMENT, SIMPLIFIED LEASE

ACQUISITION

U.S. General Services Administration GSA Region 4 Leasing Division

LEASE NUMBER: GS-04B-40148

PROJECT NUMBER: 3MS0135

AGENCY: Social Security Administration (SSA)

CURRENT ANNUAL RENTAL: $348,802.31

1. IDENTIFICATION AND DESCRIPTION OF ACTION BEING APPROVED:

The General Services Administration currently leases 16,835 rentable square feet (RSF) with a Common Area Factor (CAF) of 1.0757, yielding 15,650 ANSI/ BOMA Office Area (ABOA) square feet located at ENTERPLEX BUSINESS PARK, 1150 SOUTH GREEN STREET, TUPELO, MS 38804 (Premises) under Gov’t Lease Contract GS-04B-40148 (Lease) for the SOCIAL SECURITY ADMINISTRATION (SSA). The Lease expires June 30, 2024. Approval is requested to negotiate and add a renewal option to the Lease. If exercised, the renewal option would be effective July 01, 2024 up through June 30, 2029.

2. CALCULATION OF NET AVERAGE ANNUAL RENTAL OVER LEASE TERM:

• Estimated Shell Rate: $243,918.85

• Estimated TI (if applicable): N/A

• Lease Term including any option periods (if applicable): 26-years

• Net Average Annual Rental Calculation –

TOTAL NET ANNUAL RENT

DURING TERM

TOTAL TERM

(IN YEARS)

NET AVERAGE

ANNUAL RENT

$6,341,890.10 26 $243,918.85

3. DESCRIPTION OF EFFORTS TO SOLICIT AS MANY SOURCES AS PRACTICAL:

Advertisement placed on SAM.gov on March 30 thru April 6, 2023. Further, Government Lease GS-04P-LMS60121 was executed to replace the Lease; however, due to numerous issues during the post-award phase of the new lease, a renewal option is being added to the Lease to potentially maintain housing for SSA.

4. COST BENEFIT ANALYSIS IF APPLICABLE (insert from lease decision tool, if not

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

Highlight applicable N/A):

A cost-benefit analysis was conducted on June 09, 2023, which compared the proposed renewal at the Premises to the lowest priced alternative with all current services replicated. See the comparison below with the estimated aggregate savings associated with staying in place.

• Premises o Shell Rent: $15.94 per RSF;

o Operating Rent: $6.23 per RSF (Base Cost of Services shall continue from the effective year of the Lease. Option term is subject to continuing annual adjustments).

Summary - Current Location - OFFER/ Estimate

Total of Rent Payments Over Term $1,892,855.62 Total of TI/BSAC Amortization Payments Over Term $0.00 Lump Sum $0.00 Furniture Costs $0.00 Total Move Costs $0.00 Other Costs $0.00 Aggregate Total Project Cost of Current Location $1,892,855.62

• Location: 1507 W. Main Street, Tupelo, MS 38801 (proposed retail/ storefront/ office to break ground in June 2023).

o Shell Rent: $17.00 per RSF;

o Operating Rent: $6.25 per RSF (subject to continuing annual adjustments).

Summary - Lowest Priced Alternative - OFFER/Estimate

Total of Rent Payments Over Term $1,984,039.32 Total of TI/BSAC Amortization Payments Over Term $1,089,108.50 Lump Sum $0.00 Furniture Costs $0.00 Total Move Costs $0.00 Rent Being Paid in Old Location during Move $0.00

Other Costs $0.00 Aggregate Total Project Cost of Lowest Priced Alternative $3,073,147.82

Aggregate Cost Savings associated with Staying in Place $1,180,292

The Government could not expect to recoup the cost of replicating the Agency’s current services in another leased location during the five (5)-year renewal period. My staying at the Premises at the negotiated rate, the Government saves approximately $1.2 million of taxpayers’ money.

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

EugeneBWright Highlight

5. CONTRACTING OFFICER CERTIFICATION AND DETERMINATION THAT THE

ANTICIPATED COST WILL BE FAIR AND REASONABLE:

The projected rental rate of $22.17 per RSF falls within the expected market range. In accordance with GSAM 570.402, the Government may enter into a sole source action for continued occupancy when it is beneficial to the Government. In this event, a reasonable review by the Lease Contracting Officer has determined that the Government could not expect to recoup the costs to relocate SSA through full-and-open competition. However, an advertisement was placed on SAM.gov to comply with Federal acquisition regulations. Further, Government Lease GS-04P- LMS60121 will eventually replace the Lease once that location is ready for occupancy (not the same location used in the cost-benefit analysis). Lastly, the renewal action is expected to remain under the Simplified Lease Acquisition Threshold (SLAT) of $250,000 net operating rent per annum. Therefore, the LCO has determined to proceed with the proposed lease action.

Approved By:

6/9/2023

X Eugene B. Wright Lease Contracting Officer (LCO) Signed by: EUGENE WRIGHT

EugeneBWright Highlight