9FL2495_2_Justification_for_Other_Than_Full_and_Open_Competition_(JOFOC)_or_SLAT-level_Memo_to_File_and_Supporting_Documentation_JOTFOC_2_25_2022 (4)_Redacted.pdf

Leasing Justification– Sole Source Lease

Justification for Other Than Full and Open Competition, New Sole Source Lease

U.S. General Services Administration

GSA Region 4

Southeast Sunbelt Region / Leasing Division

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

PROJECT NUMBER: 9FL2495

Agency Name: 1719 – Naval Air Systems Command (NAVFAC/NAVAIR)

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

The Naval Air Command (NAVAIR) currently leases 160,000 ABOA/160,000 rentable square feet (RSF) of office space at 235 Industrial Loop Drive, Orange Park, FL through their contractor Sierra, Inc under their own leasing authority. The current lease expires March 3, 2022. Approval is requested to negotiate a new to GSA inventory sole source lease with the incumbent Lessor without full and open competition for continued occupancy at this leased location. The procedures for pursuing a new sole source 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).

NAVAIR submitted a continuing need letter on or around October 1, 2020 for 160,000 rentable square feet of office and related space. Following a moratorium on any new GSA lease contracts received on December 15, 2020, the requirement was on hold. On April 20, 2021, the agency noted that they had received approval for an exception to the leasing moratorium and would be extending their lease through March 3, 2022. A new GSA lease for the existing location was anticipated to follow. To satisfy the Navy mission requirements, the facility must be within 10 miles or 30 minutes’ driving distance of the Jacksonville Naval Air Station and the Defense Logistics Agency (DLA) Distribution Center.

This requirement is for 160,000 ABOA/160,000 RSF of space for a five-year term to commence on March 1, 2022. The estimated cost of this lease is per rentable square feet per year (levelized) for an annual cost of and a total contract value of The delineated area is N:

Timuquana Road (CR 134), S: Kingsley Ave (CR 224), E: Roosevelt Blvd (Hwy 17), W: Blanding Blvd (SR 21). There is no vacant Federal Space available.

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 NAVAIR to incur move and replication costs that would not be recovered through competition. Relocation costs are estimated to be $689,040.00. Additionally, this allows the Government to make use of existing tenant improvements, avoiding replication costs of $3,918,666.67. The NAVAIR Central Kitting Activity (CKA) is the sole US Navy Aircraft and Aircraft Engine modification facility in the world. The CKA builds, warehouses, updates, and issues aircraft/engine KITS for all commands worldwide and maintains an inventory valued over one billion dollars. This equipment would have to be relocated, a cost estimated over half a million dollars, along with the design and buildout costs. The warehouse must be climate controlled and secured, and allow additional room for office support, conference and training, and a COMSEC vault. A cost-benefit analysis was completed following the procedures set forth in GSAR 570.402-6. The cost of relocating NAVAIR using the low cost quote exceeds the cost of remaining at ABC Industrial Park at 235 Industrial Lop Drive in Orange Park, FL. The total savings to the Government is

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 July 2, 2021 for 21 days. In addition, PBS conducted market research using Loopnet and CoSTAR data.

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

GOVERNMENT WILL BE FAIR AND REASONABLE.

Recent market analysis conducted by PBS in Jacksonville/Orange Park, FL showed the rental rate within the delineated area ranges from $12.57 to 23.25 per RSF based on market data from REIS, CBRE, and CoSTAR. This range represents typical office space in the delineated area. Warehouse leases are typically not fully serviced and may be structured differently. The agency’s budget is based on range of $5.00 to $7.00 per RSF based on similar procurements for other Navy spaces nationwide.

Therefore, the proposed rental rates for this sole source lease of 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 February 11, 2022, PBS conducted market research using REIS, CBRE, CoSTAR, and Loopnet published data and identified two potentially acceptable locations (one plus the incumbent) that might meet the agency’s needs within the delineated area. This location, Lane Industrial Park at 2240 Lane Avenue in Jacksonville, FL is a proposed building that has been permitted but construction is not anticipated to be complete until December 2022. They do have enough contiguous space and they are ideally located to meet the requirement. In addition, PBS posted an advertisement conforming to GSAR 570.402-2 on the Contract Opportunities domain of SAM.gov website on July 2, 2021. The incumbent Lessor’s expression of interest indicated that the rate would be per RSF. The interested party that provided the lowest cost quoted a rate of per RSF in its expression of interest.

See Figure 1 below for the results of the market research and SAM.gov advertisement, including the incumbent.

Address Source [EOI/CoStar, etc.] Asking Rental Rate (net of janitorial and utilities)

[incumbent]

235 Industrial Loop Dr, Orange Park, FL

Email EOI

2282 Lane Ave N, Jacksonville, FL Email EOI, Loopnet Ad

Figure 1: Market Research Comparables

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

There is no other Government owned property that could meet the mission requirement. There is a shortage of space available to meet the tenant demands. The current facility meets the needs of NAVAIR CKA and they are satisfied with the Lessor’s performance and have a good relationship with them. The incumbent Lessor has one lease in the GSA inventory, also housing Navy, and the building is maintained in good condition and the tenants are satisfied.

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

ACQUISITION.

[Incumbent] ABC Industrial Park, 235 Industrial Loop Dr, Orange Park, FL, submitted by Clifton Byrd (crbyrd@gmail.com)

Lane Industrial Park, 2282 Lane Ave N, Jacksonville, FL submitted by Tiffani Pitts (tiffani.pitts@sunrise2sunrisetinc.com)

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

ANY BARRIERS TO COMPETITION BEFORE ANY SUBSEQUENT ACQUISITION.

In advance of an existing lease contract’s expiration, considerations will be given to allow for sufficient time to conduct a full and open procurement. The Government will consider the time and cost of moving from the existing location, and the time and cost to build out new space when deciding whether it is economically advantageous to stay at the existing building or undergo a competitive action.

Additionally, consideration will be given to the customer agency’s mission and security requirements (if applicable) to include limiting any agency space requirements that may be deemed unduly restrictive and thus favor the incumbent. 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 sole source lease of 160,000 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.

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. (Note: The Preparer is the Lease Contracting Officer)

2/14/2022

X Keitra E. Harris

Lease Contracting Officer

Signed by: KEITRA HARRIS

Concurrences – 9FL2495 NAVAIR/NAVFAC Jacksonville Warehouse JOTFOC

Recoverable Signature

X LaShone Butler

LaShone Butler

Branch Chief

Signed by: e2988242-bd56-4fc0-b353-f6e949a18b66

2/14/2022

X Heather Driskell

Heather Driskell

Lease Acquisition Officer

Signed by: HEATHER DRISKELL

2/15/2022

X LaSonya A Glover

LaSonya Glover

Leasing Director

Signed by: LASONYA GLOVER

2/16/2022

X Ben Lorber

LD4

Regional Counsel

Signed by: BENJAMIN LORBER

Approval

Expired certificate

X Pamela Mitschke

Pamela Mitschke

Competition Advocate

Signed by: General Services Administration