4PR0128 JOFOC - Redacted.pdf

Justification for Other Than Full and Open Competition, Lease Renewal

U.S. General Services Administration

GSA Region 2

Caribbean and New Jersey Branch, Leasing Division

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

PROJECT NUMBER: 4PR0128

Agency Name: OFFICE OF U.S. ATTORNEYS

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

The General Services Administration currently leases 51,124 ABOA/59,731 rentable square feet (RSF) of office space plus 134 structured parking spaces at Torre Chardon Building, 350 Chardon Avenue, San Juan, Puerto Rico under lease number LPR19162 for the U.S. Attorneys’ Office (USAO). The current lease expires July 31, 2026. Approval is requested to negotiate and add an unevaluated lease renewal option with the incumbent Lessor, without full and open competition, for continued occupancy at this leased location. The procedures for pursuing a lease renewal are detailed in GSAR 570.401: Renewal Options.

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

(INCLUDING ESTIMATED VALUE).

The U.S. Attorneys’ Office confirmed on December 11, 2023 that the space occupied under Lease number LPR19162 is still required. The USAO intends to move to vacant Federal Space once seismic retrofit and mechanical upgrades at the Degetau Federal Building are complete. The proposed added renewal is for a five (5) year term, that if exercised, will protect the occupancy of the USAO.

This requirement is for 51,124 ABOA/59,731 RSF of space for a five (5) year renewal term that, if exercised, will commence on August 1, 2026. The current rental rate is per rentable square feet per year, fully serviced. The estimated cost of this lease is (rounded) per rentable square feet per year for an annual cost of and a total contract value of .

The delineated area is Northern Boundary: State Highway 22 (Expreso de Diego) to Intersection of Avenida Plaza Las Americas to Calle Juan Calaf to Avenida Arterial B to Intersection of Avenida Ponce De Leon (PR State Road 25) and Calle Prudencio Rivera Martinez, Eastern Boundary: Starting at the Intersection of Calle Prudencio Rivera Martinez and Avenida Ponce De Leon (PR State Road 25) to Avenida Jesus T Pinero (State Road 17), Southern Boundary: Starting at the Intersection of Avenida Ponce De Leon (State Road 25) and Avenida Jesus T Pinero (State Route 17) to Expreso Martinez Nadal (State Road 20), Western Boundary: Starting at the Intersection of Expreso Martinez Nadal (State Road

20) and Jesus T Pinero (State Road 17) to State Road 2 to Expreso de Diego (State Highway 22). There is no vacant Federal Space available at this time.

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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 570.401. In accordance with GSAR 570.401, 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 for furniture, for move costs, of double rent during the move, for an estimated total of . Additionally, this allows the Government to make use of existing tenant improvements (TI), building specific amortized capital (BSAC), and recent renovations to the space in the amount of . Avoiding replication costs of an estimated to be amortized at a rate of 8% over a term of 5 years, for an estimated total of in TI/BSAC amortization payments. USAO has a FSL level 3. A cost-benefit analysis was completed following the procedures set forth in GSAR 517.207. The cost of relocating USAO using the low cost quote exceeds the cost of remaining at the Torre Chardon Building. The total savings to the Government is . See attached Cost Benefit Analysis.

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

MANY POTENTIAL SOURCES AS IS PRACTICABLE.

Per the requirements of GSAR 570.401, the GSA Leasing Specialist placed an advertisement on the Contracting Opportunities domain of SAM.gov on April 25, 2024 for 7 days. In addition, PBS conducted market research using an internet search and a recent JLL market research presentation.

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

GOVERNMENT WILL BE FAIR AND REASONABLE.

Recent market surveys conducted by PBS in SAN JUAN, PR showed the fully serviced rental rate within the delineated area ranges from to per RSF, when adjusted for a fully serviced rental rate inclusive of parking. The market data was collected from an internet search and a recent JLL market research presentation, which is representative of long firm terms, typically between 5 and 10 years. See attached Market Research. Considering the short-term nature of the proposed renewal option, the anticipated rental rate of (rounded)/RSF, is below the current market range for this submarket and is deemed fair and reasonable by the GSA Lease Contracting Officer. Nonetheless, the Lease Contracting Officer plans to negotiate the renewal rental rate with the incumbent Lessor.

7. DESCRIPTION OF MARKET RESEARCH CONDUCTED AND THE RESULTS.

GSAR 570.401 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 March 20, 2024, PBS conducted market research using google search (commercialsearch.com, two20group.idxbroker.com) and JLL Market Research and identified 5 potentially acceptable locations (4 plus the incumbent) that might meet the agency’s needs within the delineated area.

See Figure 1 below for the results of the market research, including the incumbent.

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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 lease renewal of 59,731 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.

Lease Contracting Officer

12. CONCURRED BY:

Branch Chief

Lease Acquisition Officer

Leasing Director

13. REVIEWED BY:

Senior Assistant Regional Counsel

14. APPROVED BY:

Competition Advocate

PBS Regional Commissioner

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