JOFOC_fullyRedacted.pdf

U.S. General Services Administration

GSA Region 10

LEASING DIVISION

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Project Number: 0WA2327

Agency: Social Security Administration (SSA)

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

The General Services Administration currently leases office space at 9594 Mickelberry Rd NW, Silverdale, WA as outlined in Paragraph 2, below. 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 right to pursue a succeeding lease is detailed in GSAR 570.402: Succeeding Leases.

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

(INCLUDING ESTIMATED VALUE).

Table 1 – Existing Lease Info.

Lease No. Lease Expiration

Agency ABOA SF RSF

LWA06382 3/15/24 SSA 11,417 11,417

Table 2 – Requested Action

Project No.

Term Agency ABOA

SF

RSF Action Requested

0WA2327 3/16/24 –

3/15/44

SSA 11,417 11,417 Succeeding lease. 20 years, 10 years firm term. Must be within the delineated area of the Central Business District of Silverdale, WA.

Must be within walkable distance to public transportation and public parking. Cannot be within 500 feet of active freight-carrying railroad tracks.

SSA submitted a continuing need letter on March 12, 2021. The estimated initial cost of this lease is $ per RSF for years 1-20 for an annual cost of $ and a total contract value of $ (includes estimated 2.5% annual operating cost escalations). Unfortunately, there is no vacant Federal Space available in this area for this requirement.

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 and GSAR 570.402-4, No Potential Acceptable Locations. Additionally, if there were other acceptable locations, the estimated cost to move would be $ , while the estimated TI buildout costs to replicate the space would start at $ .

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 extend the lease at the current location. SSA submitted continuing needs requirements to carry out its mission in the central business district area of Silverdale, WA; however, there are no potential acceptable office spaces located in SSA’s delineated area other than the incumbent lessor’s space. A cost benefit analysis (CBA) was prepared for the proposed lease following the procedures set forth in GSAR 570.402-6 and is attached to this justification. PBS noted that, while nearby Bremerton may have available office space, the cost of relocating and replicating 9594 Mickelberry Rd NW, Silverdale, WA exceeds the cost of remaining there. Accordingly, expanding the delineated area to increase competition is not recommended. The total savings to the Government is $2,140,283.00 or 26%.

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, on March 17, 2022, an advertisement was placed on the contracting opportunities domain of SAM.gov seeking office space in the delineated area of the central business area of Silverdale, WA, but after 25 days, no responses were received from other than the incumbent Lessor. In addition, PBS conducted market research via CoStar and LoopNet, but no other office spaces in Silverdale, WA had a minimum of 11,417 USF.

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 Silverdale, WA showed the full service rental rate within the delineated area of Silverdale and including Bremerton, WA is as high as $44.34 per RSF for up to 8,444 USF (CoStar and LoopNet). PBS looked at rental rates of B and C building classes in both Bremerton and Silverdale, none of which had a minimum of 11,417 USF that was contiguous. The market comps table shows the average full service rate in both of these markets.

The current adjusted shell rental rate of 9594 Mickelberry Rd NW, Silverdale, WA is $ per RSF. The market comps table indicates a CoStar adjusted shell rate of $23.07 per RSF. Using the CoStar data, the anticipated REXUS full-service rate calculates to be $ after adding an average operating cost of $ . Using this information, GSA intends to award a succeeding lease using the anticipated rental rate of $ per RSF, which is within the current market range for this submarket and 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 September 28, 2020 and again on September 13, 2022, PBS conducted market research using CoStar and LoopNet and identified 0 potentially acceptable locations (0 plus the incumbent) that might meet the agency’s needs within the delineated area In addition, PBS posted an advertisement conforming to GSAR 570.402-2 on the Contract Opportunities domain of SAM.gov website on March 17, 2022. The incumbent lessor has expressed interest in this continued requirement; however, they have deferred providing a rate until receipt of the RLP and Lease.

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

SSA has informed GSA that they are satisfied in this location. The most recent property inspection showed the space to be well maintained and in good condition.

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

ACQUISITION.

1The incumbent lessor and contact information.

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 succeeding lease of 11,417 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_____________________

Supervisory Lease Contracting Officer, Leasing Division (10PRAB)

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.

_______________________________Date_____________________

Lease Contracting Specialist, Leasing Division (10PRAB)

13. REVIEWS, CONCURRENCES, APPROVAL.

Concurred by:

___________________________ Date______________________

Lease Acquisition Branch Chief, Leasing Division (10PRA)

Reviewed by:

___________________________ Date______________________

Deputy Regional Counsel, Region 10 (LDA)

Approved by:

____________________ Date______________________

Director, Leasing Division (10PR)

INTERNAL USE ONLY- Do not send outside of GSA. Use "Generate Customer Report" button at bottom of sheet if sharing with Customer.

Version: May 2022

Lease Number Street Address City State Current

Lease USF Current Lease RSF Lease Effective

Date Lease Expiration

Date Lease Termination

Rights Date

LWA06382 9594 MICKELBERRY RD NW SILVERDALE WA 11,417 11,417 3/16/2004 3/15/2024 3/15/2024

11,417 11,417

Agency Name Reis Market Asking Rate per RSF Effective Rate per RSF Custom TI Tier 2 Custom TI % Increase 20% Reis Submarket -$ -$

Reis Submarket (Optional) -$ -$ Reis Market Asking Rate per RSF Effective Rate per RSF Reis Submarket (Optional) -$ -$ Reis Submarket -$ -$ Reis Averages -$ -$ Reis Rate -$

CBRE Market Asking Rate per RSF Effective Rate per RSF CBRE Market Asking Rate per RSF Effective Rate per RSF CBRE Submarket -$ -$ CBRE Submarket -$ -$ CBRE Submarket (Optional) -$ -$ CBRE Rate -$ CBRE Submarket (Optional) -$ -$

-$ CBRE Averages -$ -$ Market Average -$

Local Construction Index (LCI)- State LCI- City LCI Adjustment to TI

Yes (Y) / No (N) Cost* Agency TI cost per foot (National Average) $0

N $0 Enter Actual Cost ($) Carpet (broadloom) 0% N $0 Carpet (tile) 0% N $0

VCT 0% N $0 $0

N $0 $0 N $0 Total ROM TI Cost (includes 32% for overhead, profit, GCs, and Bonds) N $0 N $0 E. Move Costs Yes (Y) / No (N) Cost* N $0 Building to Building Furniture & Systems Move Y N $0 Floor to Floor Furniture & Systems Move N $0 N $0 Building to Building telephone systems move Y N $0

Enter Actual Cost ($) Enter Actual Costs ($) $0 $0 $0 $0 $0 $0 $0 $0 $0

Amortization Rate (TI) Common Area Factor Common Area Factor

Lease Term (years) Estimated TI Buildout Costs Amount to be Amortized TI Amortization Term (years) Lump Sum TI Amount

Total of Rent Payments Over Term (Excluding TI) Total of TI Amortization Payments Over Term Lump Sum Portion of TI Total Move Cost Aggregate Total Project Cost

$2,140,283 26%

Note: GSA's default position for all lease procurements is Full and Open Competition. Procurements using Other Than Full and Open Competition should be only pursued only when comparatively significant savings are shown, as outlined under GSAM 570.104 and FAR 6.302-1(a)(2)(ii)(A) ["Substantial duplication of cost to the Government that is not expected to be recovered through competition.”]. While there is no established standard or hurdle rate for the level of anticipated cost savings required, a minimum figure of 20% is a good indicator for project teams to use when working with client agencies in outlining preliminary procurement strategies. Project teams, in consultation with the LCO, should also take into consideration other factors such as mission requirements, location policy, anticipated competition, existing space conditions, past performance, and similar due diligence information before finalizing any lease procurement strategies.

Rough Order of Magnitude Cost Benefit Analysis

Current Location

AB Code

SOCIAL SECURITY ADMINISTRATION

Current Lease Data

Current Location Alternate Location Based on Market Data Market Average based on REIS and CBRE Data

1.09

Washington State Average

(Optional)

Known BSAC/ Unique TI Costs

Known Unique Move or Personal Property Costs (Lump Sum)

Washington State Average

1.09

8.00%

Alternate Location Based on Market Data - ROM

BSAC

TIA (General + Custom)

(Optional)

Rates & Data Factors

Total ROM Move Cost for Alternate Location

(Optional) (Optional)

1.15

Tenant Improvements for Alternate Location

Anticipated Square Footage (ABOA SF)

Expected Full Service Asking Rate for Succeeding Lease

Tenant Improvements for Current Location

Projected Full Service Rate for Succeeding Lease Manual Rate Entry Manual Rate Entry

Projected Full Service Rate for Alternative Space Provide justification for why market rates are not being used:

Full service rate over 20 years based on market average.

Provide justification for why market rates are not being used:

Full service rate over 20 years based on current rate at leased space.

Anticipated Square Footage (ABOA SF)

*Rental payment calculations use Average Asking rates; Effective Rates are provided for information only.

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Local Construction Index (LCI)- State LCI- City LCI Adjustment to TI

Rates & Data Factors Amortization Rate (TI)

Lease Term (years) Estimated TI Buildout Costs

Total ROM TI Cost for Current Location (includes 32% for overhead, profit, GCs, and Bonds)

New Phone system

Remove Carpet with System Furniture in place Vinyl Wall Base Paint

$0 $0Lump Sum Portion of TI

Total of TI Amortization Payments Over Term

Vinyl Wallcovering Space Planning Programing Government DID's

Known BSAC/ Unique TI Costs

Amount to be Amortized

$0

1.00

Floor to Floor Furniture & Systems Move

Anticipated Succeeding Lease Savings:

8.00%

$0

(Optional) (Optional) (Optional)

(BSAC)

Aggregate Total Project Cost

TI Amortization Term (years) Lump Sum TI Amount

Current Location - ROM

$0

Total of Rent Payments Over Term (Excluding TI)

= User Input Required

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