5MD0398_-_OTFO_-_Redacted.pdf

US GENERAL SERVICES ADMINISTRATION

NATIONAL CAPITAL REGION

PUBLIC BUILDINGS SERVICE

OFFICE OF LEASING

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

1. IDENTIFICATION AND DISCUSSION OF ACTION BEING APPROVED:

PROJECT TITLE:

PROPOSED ACTION:

LEASE NUMBER:

PROJECT NUMBER:

PROSPECTUS NUMBER:

BUILDING NUMBER:

RSF/ABOASF:

EXPIRATION DATE:

Two Rockledge Centre, 6701 Rockledge Dr., Bethesda, MD

Extension (23 months)

GS·11B·LMD01787 (existing)

SMD0398

PMD-01-WA14

MD1858

247,130 I 227,226

11/3012017

The General Services Administration (GSA) currently leases 247,130 RSF I 227,226 ABOASF of office and related space occupied by the National Institutes of Health (NIH) National Heart Lung and Blood Institute

(NHLBI), the Center for Scientific Review (CSR), and the Office of Research Services (ORS), at Two

Rockledge Centre, 6701 Rockledge Dr., Bethesda, MD under GSA Lease GS-llB-01787. The lease expires on November 30,2017. This lease is one of six NIH locations (four locations under GSA leases and two locations with NIH direct leases) that are scheduled to be consolidated into the new NIH Rockledge

Campus (6701 and 6705 Rockledge Dr., Bethesda, MD) under lease numbers LMD00152, LMD00153, and LMD00158. Because this space is also part of the new NIH Rockledge Campus, current lease

LM001787 is slated to be replaced by LMD00152 upon the commencement of the new NIH Rockledge

Campus consolidation leases, which have an anticipated commencement date of November 1, 2019.

Therefore, NIH has a continuing need for 247,130 RSF at the subject location for a period of 23 months.

The short term extension will provide for the continued housing of NIH until the anticipated composite commencement date for the new NIH Rockledge Campus consolidation leases of November 1, 2019.

Approval is requested to negotiate a lease extension, from December 1, 2017 through October 31, 2019, at which point the lease will be replaced by the new NIH Rockledge Campus consolidation leases.

2. DESCRIPTION OF REQUIREMENT:

NIH needs to maintain occupancy of 247,130 RSF I 227,226 ABOASF of office and related space under

GSA lease LMD01787 at Two Rockledge Centre, 6701 Rockledge Dr., Bethesda, MD, until the composite commencement date for the new Rockledge Campus consolidation leases at 6701 and 6705 Rockledge

Dr., Bethesda, MD, on November 1, 2019. The estimated contract value for this action is······

[247,130 RSF x annum I 12 months x 23 months=

3. IDENTIFICATION OF THE STATUTORY AUTHORITY:

41 U.S.C. 3304 (a)(1). The property or services needed by the executive agency are available from only one responsible source and no other type of property or services will satisfy the needs of the executive agency.

4. DEMONSTRATION THAT THE ACQUISITION REQUIRES USE OF THE AUTHORITY CITED:

GSAM 570.405 (c) provides for continued occupancy at the incumbent location on a short term basis in situations such as this where the tenant agency is scheduled to move into competitively procured space, but needs additional time at the incumbent location while the new space is readied for occupancy. As discussed above, the 247,130 RSF at this location is part of the NIH Rockledge Campus consolidation. The short term extension is necessary to provide for the continued housing of NIH until the anticipated composite commencement date for the new NIH Rockledge Campus consolidation leases at 6701 and 6705 Rockledge Dr., Bethesda, MD, which is expected to be November 1, 2019.

5. DESCRIPTION TO SOLICIT AS MANY OFFERS AS PRACTICABLE:

In accordance with GSAM 570.106(d), no advertisement for an extension under the conditions of GSAM 570.405 is required.

6. DEMONSTRATION THAT THE ANTICIPATED COST WILL BE FAIR AND REASONABLE:

In accordance with FAR 6.303·2 (b)(7), the Contracting Officer determines by certifying this document that the anticipated cost for the office space estimated under Section 2 of this document is considered fair and reasonable based on the following:

• The current rental rate for the subject lease is- per RSF and the prospectus for the replacement lease has a maximum proposed rental rate of- per RSF, which is equal to the Maryland program rate.

• The short length of the extension will command a premium, at a minimum, above the current rental rate, potentially putting the rate above the Co·Star range average discussed below.

• A CoStar survey was conducted on September 22, 2017, for blocks of 100,000 RSF or more square feet in Montgomery County, Maryland. The starting rental rates that were found ranged between-and~er RSF (averaging~er RSF) with annual shell rent increases

of. Of the 17 properties identified, only 1 would be able to provide the full247,130 RSF required by NIH.

• The Contracting Officer anticipates that the rental rate for this extension will be at or above the current rate of- It is the intention of the contracting officer to negotiate a rate that is below the current Maryland program rate.

7. DESCRIPTION OF THE MARKET SURVEY CONDUCTED:

Due to the short term nature of the extension and the cost of replicating the function for this short 23 month period, there are no buildings in the delineated area that can meet the timetable for occupancy for this extension term or overcome the cost of moving the agency and replicating their space while remaining competitive with the incumbent location. A CoStar survey was conducted on September 22, 2017 for rental rates in Montgomery County, Maryland. The starting rental rates that were found ranged per RSF (averaging~er RSF) with annual shell rent increases

0~

8. OTHER FACTORS SUPPORTING USE OF OTHER THAN FUll AND OPEN COMPETITION:

N/A

9. UST OF SOURCES THAT EXPRESSED AN INTEREST IN THE ACQUISITION:

None

10. STATEMENT OF ACTIONS TO OVERCOME BARRIERS TO COMPETITION

Upon expiration of this extension, this lease will be consolidated with and replaced by new NIH Rockledge Campus consolidation leases at 6701 and 6705 Rockledge Drive under the three leases procured under prospectuses PMD·03·WA14 and PMD-Ol-WA14.

11. TECHNICAL REQUIREMENTS PERSONNEL CERTIFICATION:

I certify that the supporting data used to form the basis of this justification is complete and accurate to the of my and belief.

Date

12. CONTRACTING OFFICER CERTIFICATION:

By signature on this justification for Other than Full and Open Competition, the Contracting Officer certifies that the extension of LMD01787 at Two Rockledge Center, 6701 Rockledge Dr., Bethesda, MD, is in the Government's best interest and is accurate and complete to the best of my knowledge and belief.

Jim Phelan (WPRA) Contracting Officer

Concurrences:

Swain Deputy Director, Office of Portfolio Management & Real Estate

Director, Office of Portfolio Management & Real Estate

Competition Advocate

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