Part 570 - Acquiring Leasehold Interests in Real Property

“ANSI/BOMA Office Area (ABOA)” means the area “where a tenant normally houses personnel, and/or furniture, for which a measurement is to be computed,” as stated by the American National Standards Institute/Building Owners and Managers Association(ANSI/BOMA)publication Z65.1-1996.

“Contract” means lease.

“Contractor” means lessor.

“Landlord” or “lessor” means any individual, firm, partnership, trust, association, State or local government, or other legal entity that leases real property to the Government.

“Lease” or “leasehold interest in real property” means a conveyance to the Government of the right of exclusive possession of real property for a definite period of time by a landlord. It may include operational services provided by the landlord.

“Lease acquisition” means the acquiring by lease of an interest in improved real property for use by the Government, whether the space already exists or must be constructed.

“Lease extension” means extension of the expiration date of a lease to provide for continued occupancy on a short term basis.

“Lease renewal” (option) means the right, but not the obligation of the Government to continue a lease upon specified terms and conditions, including lease term and rent.

“Lessee” or “tenant” means the United States of America.

“Operational services” means services that support use of a leased property, such as heating, ventilation, air conditioning, utilities, and custodial services.

“Simplified lease acquisition procedures” mean the procedures for awarding leases at or below the simplified lease acquisition threshold.

“Simplified lease acquisition threshold” means the simplified acquisition threshold (see FAR 2.101), when applied to the average annual amount of rent for the term of the lease, including option periods and excluding the cost of services.

“Small business” means a concern including affiliates, which is organized for profit, is independently-owned and operated, is not dominant in the field of leasing commercial real estate, and that has annual average gross receipts for the preceding three fiscal years which are less than the size standard established by the Small Business Administration pursuant to 13 CFR 121. The size standards may be found at https://www.sba.gov/content/small-business-size-standards. For most lease procurements, the NAICS code is 531190.

“Solicitation for Offers (SFO)” means a request for proposals.

“Substantially as follows” or “substantially the same as,” when used in prescribing a provision or clause, means that the contracting officer may prepare and use a variation of that provision or clause to accommodate requirements peculiar to an individual acquisition. The variation must include the salient features of the FAR or GSAR provision or clause. It must also be consistent with the intent, principle, and substance of the FAR or GSAR provision or clause and related coverage on the subject matter.

“Succeeding lease” means a lease whose effective date immediately follows the expiration date of an existing lease for space in the same building.

“Superseding lease” means a lease that replaces an existing lease, prior to the scheduled expiration of the existing lease term.

(a)  The Administrator of General Services is authorized by 40 U.S.C. §585 to enter into a lease agreement for the accommodation of a Federal agency in a building (or improvement) which is in existence or being erected by the lessor for the accommodation of the Federal agency. The lease agreement may not bind the Government for more than 20 years.

(b)  The contracting officer has exclusive authority to enter into and administer leases on the Government’s behalf to the extent provided in the certificate of appointment as a contracting officer. Nothing in this paragraph is intended to limit the contracting officer’s authority to designate, consistent with statute and regulation, a contracting officer’s representative.

Unless the contracting officer uses the simplified procedures in subpart  570.2, the competition requirements of FAR part 6 apply to acquisition of leasehold interests in real property.

(a) If a proposed acquisition is not exempt under FAR 5.202 or GSAR 570.106(e), and is for a leasehold interest in real property estimated to exceed 10,000 square feet, then the contracting officer must publicize the proposed acquisition in the System for Award Management Contract Opportunities at https://www.sam.gov in its place.

(b) For leasehold acquisitions where the solicitation requires the construction of a new building on a preselected site, the contracting officer, in accordance with the timeframes established in FAR 5.203, must publicize the proposed acquisition in the GPE regardless of size or value.

(c)  For leasehold acquisitions not subject to a square foot measurement (e.g., antennas, piers, parking), contracting officers must publicize the proposed acquisition in the GPE when the contract action is expected to exceed $25,000, unless an exception under FAR 5.202 applies.

(d)  Other than as identified in paragraphs (a) through (c) of this section, the contracting officer need not publicize the proposed acquisition of a leasehold interest in real property, including expansion requests within the scope of a lease (see 570.403), lease extensions under the conditions defined in 570.405, and building alterations within the scope of a lease (see 570.5). However, the contracting officer may publicize proposed lease acquisitions of any dollar value or square footage in the GPE or local newspapers if, in the opinion of the contracting officer, doing so is necessary to promote competition.

(e)  The contracting officer may issue a consolidated advertisement for multiple leasing actions.

(f)  Except as otherwise provided in paragraph (b) of this section, where publicizing of the proposed acquisition is required, the notice shall be published in the GPE not less than three calendar days prior to issuance of a solicitation.

(g)  Except as otherwise provided in paragraph (b) of this section and as set forth in paragraphs (g) and (h) of this section, the contracting officer shall provide offerors not less than 20 calendar days between solicitation issuance and the date established for receipt of initial offers.

(1)  For a proposed acquisition using simplified lease acquisition procedures (see 570.2), consider the individual acquisition and establish a reasonable response time.

(2) In cases of unusual and compelling urgency (FAR 6.303-2), provide as much time as reasonably possible under the circumstances and document the contract file.

(h)  If a Member of Congress has specifically requested notification of award, the contracting officer must provide award notifications in accordance with 505.303.

The contracting officer may require oral presentations for acquisitions of leasehold interests in real property. Follow the procedures in FAR 15.102.

(a) Determine that the prospective awardee is responsible with respect to the lease under consideration. The standards in FAR 9.104 apply. As part of the determination that a prospective contractor is otherwise qualified and eligible for award, review exclusions in the System for Award Management (SAM).

(b)  The contracting officer’s signature on the contract is deemed an affirmative determination.

(c)  If the contracting officer finds an offeror nonresponsible, sign and place in the contract file a determination of nonresponsibility. State the basis for the determination.

(d) If the contracting officer finds a small business concern nonresponsible, the procedures at FAR 19.6 apply. Place all documents and reports supporting a determination of responsibility or nonresponsibility in the lease file.

Before awarding a lease, review applicable representations and certifications for compliance with statute and regulations.

(a) The policies and procedures of FAR 15.403 apply to lease contract actions.

(b) FAR 15.403-1 defines exceptions to and waivers for submitting cost or pricing data. Most leasing actions will have adequate price competition. For price analysis of offered rental rates, the contracting officer may use a market survey, an appraisal conducted using accepted real property appraisal procedures to establish a market price for comparison, or other relevant market research data. For price analysis of offered tenant improvement costs, obtain two offers or cost and pricing data.

(c) In exceptional cases, the requirement for submission of certified cost or pricing data may be waived under FAR15.403-1(c)(4).

(d) If cost or pricing data are required, follow the procedures in FAR15.403-4 and 15.406-2.

Before accepting the space, the contracting officer must verify that the space complies with the Government’s requirements and specifications and document this in an inspection report. The inspection and acceptance document must contain the square footage accepted and the acceptance date. Include the inspection and acceptance in the contract file. When space such as piers, antennas, and parking are leased, square footage may not be the manner in which the amount of space is specified; therefore, document that the space complies with the Government’s written requirements.

If the contracting officer receives an offer from an officer or employee of the Government, follow the procedures in FAR 3.6.

If a mistake in a lessor’s offer is discovered after award, the contracting officer should process it substantially in accordance with FAR 14.407-4 and GSAM 514.407-4.

FAR 33.1 and 533.1 apply to protests of lease acquisitions.

In the event of a transfer of ownership of the leased premises or a change in the lessor’s legal name, FAR 42.12 applies.

The uniform contract format is not required for leases of real property.

If a foreign ownership disclosure is made pursuant to clause 552.270-33:

(a) The contracting officer shall notify the Federal tenant for the leased space in writing:

(1) If the disclosure is made during the lease acquisition process, the contracting officer shall notify the Federal tenant prior to lease award.

(2) If the disclosure is made concurrent with a request for novation, the contracting officer shall notify the Federal tenant prior to executing the novation.

(3) If the disclosure is made concurrent with a renewal option or extension, the contracting officer shall notify the Federal tenant prior to executing the renewal option or extension.

(b) The contracting officer shall coordinate with the Federal tenant regarding security concerns and any necessary mitigation measures.

This subpart prescribes simplified procedures for small leases. These procedures reduce administrative costs, while improving efficiency and economy, when acquiring small leasehold interests in real property.

Use simplified lease acquisition procedures to the maximum extent practicable for actions at or below the simplified lease acquisition threshold.

Conduct a market survey to identify potential sources. Use information available in GSA or from other sources to identify locations capable of meeting the Government’s requirements.

(a)  The description of requirements depends on the nature of the space the agency needs and the market available to satisfy that need.

(b)  The description of requirements must include all the following:

(1)  A statement of the purpose of the lease.

(2)  Functional, performance, or physical requirements.

(3)  Any special requirements.

(4)  The delivery schedule.

(c)  The description must promote full and open competition. Include restrictive provisions or conditions only to the extent necessary to satisfy the agency’s needs or as authorized by law.

(a)  These procedures apply to acquisitions of leasehold interests except if the contracting officer uses one of the following:

(1)  Simplified lease acquisition procedures authorized by 570.2.

(2)  Two-phase design-build selection procedures authorized by 570.105-2.

(b)  The contracting officer is designated as the source selection official unless the HCA appoints another individual for a particular leasing action or group of leasing actions.

(c) In a trade off procurement, the contracting officer must include price or cost to the Government, past performance, the planned participation of small disadvantaged business concerns in performance of the contract, and other factors as required by FAR 15.304 as evaluation factors. The contracting officer may include other evaluation factors as needed.

(d) The evaluation factors and significant subfactors must comply with FAR 15.304 and either one of the following:

(1) FAR 15.101-1 if the contracting officer will use the tradeoff process.

(2) FAR 15.101-2 if the contracting officer will use the lowest price technically acceptable source selection process.

(a)  These procedures apply to acquisitions of leasehold interests if the contracting officer uses the two-phase design-build selection procedures authorized by 570.105-2. Follow FAR 36.3.

(b)  The SFO must include all the following information:

(1)  The Scope of Work.

(2)  The evaluation factors and subfactors to be used in evaluating phase-one proposals and their relative importance.

(3)  The maximum number of offerors to be selected to submit competitive proposals in phase-two.

(4)  The evaluation factors, including cost or price, and subfactors to be used in evaluating phase-two proposals and selecting the successful offeror, and their relative importance.

(c)  The following procedures apply to phase-one evaluation factors:

(1)  Phase one factors include:

(i)  Specialized experience and technical competence.

(ii)  Capability to perform.

(iii)  Past performance of the offeror’s team (including architect-engineer and construction members of the team).

(iv)  The planned participation of small disadvantaged business concerns in performance of the contract.

(v)  Other appropriate factors, such as site or location.

(2)  The contracting officer shall not require offerors to submit detailed design information or cost or price information in phase one. The contracting officer shall not use cost related or price related evaluation factors.

(d)  The contracting officer shall set the maximum number of offerors to be selected for phase-two to not exceed five unless the contracting officer determines that a number greater than five is both:

(1)  In the government’s interest.

(2)  Consistent with the purpose and objectives of the two-phase selection process.

(e)  In phase-two, require detailed technical and price proposals. Evaluate the proposals using the procedures in 570.306.

(a)  The contracting officer must evaluate offers solely in accordance with the factors and subfactors stated in the SFO.

(b)  Evaluate prices and document the lease file to demonstrate that the proposed contract price is fair and reasonable. The contracting officer must review the elements of the offeror’s proposed rent to analyze whether the individual elements are realistic and reflect the offeror’s clear understanding of the work to be performed. The contracting officer must discuss any inconsistencies with the offeror. If the offeror refuses to support or make any changes to the rent proposed, consider the risk to the Government prior to making any lease award.

(c)  Evaluate past performance on previous lease projects in accordance with 515.305 and FAR 15.305(a)(2). Obtain information through:

(1)  Questionnaires tailored to the circumstances of the acquisition;

(2)  Interviews with program managers or contracting officers;

(3)  Other sources; or

(4) Past performance information collected under FAR 42.15 and available through the Contractor Performance Assessment Reporting System at https://www.cpars.gov/​, or successor system.

(d)The contracting officer may obtain information to evaluate an offeror's past performance on subcontracting plan goals and monetary targets from the following sources:

(1)  The Small Business Administration;

(2)  Information on prior contracts from contracting officers and administrative contracting officers;

(3)  Offeror’s references; and

(4) Past performance information collected under FAR 42.15 and available through PPIRS.

(e)  Document the evaluation of award factors other than price listed in the solicitation. The file must include the basis for evaluation, an analysis of each offer, and a summary of findings.

(f)  Also see the requirements in 570.108, 570.109 and 570.111.

(a) Follow the procedures in FAR 15.306 and 15.307 for exchanges (including clarifications, communications, negotiations, discussions, and revisions).

(b)  Place a written record of all exchanges in the lease file.

(c) Provide prompt written notice to any offeror excluded from the competitive range or otherwise eliminated from the competition in accordance with FAR 15.503(a).

(a)  Make award to the responsible offeror whose proposal represents the best value after evaluation in accordance with the factors and subfactors in the SFO.

(b)  Make award in writing and in the timeframe specified in the SFO.

(1)  If the contracting officer cannot make an award in that time, request in writing from each offeror an extension of the acceptance period through a specific date.

(2)  If time is critical, the contracting officer may request the extensions orally. The contracting officer must make a record of the request and confirm it promptly in writing.

(c) Notify unsuccessful offerors in writing or electronically in accordance with FAR 15.501 and 15.503(b).

(d)  The source selection authority may reject all proposals received in response to an SFO, if doing so is in the best interest of the Government.

The procedures of FAR 15.505 and 15.506 apply to leasing actions.

(a) If the expansion space is in the general scope of the lease, the contracting officer may acquire the space through a modification without further justification under FAR 6.3.

(b)  If the expansion space needed is outside the general scope of the lease, the contracting officer must determine whether it is more prudent to provide the expansion space by supplemental agreement to the existing lease or to meet the expansion requirement and existing tenancy to the requirement by competitive means.

(1)  Conduct a market survey to determine the availability of suitable alternative locations.

(2)  If you identify alternate locations that can satisfy the total requirement, perform a cost-benefit analysis to determine whether it is in the Government’s best interest to relocate. Consider, as appropriate:

(i)  The cost of the alternate space compared to the cost of expanding at the existing location.

(ii)  The cost of moving.

(iii)  The cost of duplicating existing improvements.

(iv)  The cost of the unexpired portion of the firm lease term. If a termination is possible, use the actual cost of such an action.

(v)  The cost of disruption to the agency’s operation.

(c)  If the contracting officer determines not to use competitive procedures and the expansion space is outside the general scope of the lease:

(1)  If the estimated value of the acquisition does not exceed the simplified lease acquisition threshold, document the file as required by 570.203-2.

(2) If the estimated value of the acquisition exceeds the simplified lease acquisition threshold, prepare a justification for approval under FAR 6.3 and 506.3.

(a)  Consider executing a superseding lease to replace an existing lease when the Government needs numerous or detailed modifications to the space that would cause complications or substantially change the present lease or when market conditions warrant renegotiation of an existing lease.

(b) If the value of the superseding lease exceeds the simplified lease acquisition threshold, the justification and approval requirements in FAR 6.3 and 506.3 apply. If the cost does not exceed the simplified lease acquisition threshold, the contracting officer may use the simplified procedures in 570.2 and explain the absence of competition in the file.

(a)  This subsection applies to extension of the term of a lease to provide for continued occupancy on a short term basis.

(b) If the value of a lease extension will exceed the simplified lease acquisition threshold, the justification and approval requirements in FAR 6.3 and 506.3 apply. For extensions that will not exceed the simplified lease acquisition threshold, the contracting officer may use the simplified procedures in 570.2 and explain the absence of competition in the file.

(c) FAR 6.302-1 permits contracting without providing for full and open competition when the property or services needed by the agency are available from only one responsible source and no other type of property or services will satisfy the needs of the agency. This authority may apply to lease extensions in situations such as, but not limited to, the following:

(1)  The agency occupying the leased space is scheduled to move into other Federally controlled space, but encounters unexpected delays in preparing the new space for occupancy.

(2)  The Government encounters unexpected delays outside of its control in acquiring replacement space.

(3)  The Government is consolidating various agencies and the contracting officer needs to extend the terms of some leases to establish a common expiration date.

(4)  The agency occupying the space has encountered delays in planning for a potential relocation to other federally controlled space due to documented organizational, financial, or other uncertainties.

(a)  The procedures in 570.502 apply to alterations acquired directly from a lessor by modification or supplemental lease agreement. This is allowed if the following conditions are met:

(1)  The alterations fall within the scope of the lease. Consider whether the work can be regarded fairly and reasonably as part of the original lease requirement.

(2)  The lessor is willing to perform the proposed alterations at a fair and reasonable price.

(3)  It is in the Government’s interest to acquire the alterations from the lessor.

(b)  If proposed alterations are outside the scope of the existing lease, decide whether to acquire the alterations through either:

(1)  A supplemental lease agreement, as justified and approved under 570.502-1.

(2)  Government performance or a separate contract. The lease must first provide the Government with the right to perform alterations to the leased space.

If the Government chooses to exercise its right to make the alterations rather than contracting directly with the lessor, the Government may either:

(a)  Have Federal employees perform the work.

(b)  Contract out the work using standard contracting procedures that apply to a construction contract performed on Federal property. If the Government decides to contract for the work, invite the lessor, as well as all other prospective contractors, to submit offers for the project.

(a)  Lease tenant agencies may need overtime services and utilities on a regular or intermittent basis. Lease contracting officers may negotiate overtime rates for services and utilities and include those rates in leases where a need is projected. Only lease contracting officers may negotiate overtime rates.

(b)  An independent government estimate is required in support of the negotiated rate.

(c)  Order. To order overtime services and utilities, if the order does not exceed the simplified acquisition threshold, a warranted contracting officer’s representative, in GSA or the tenant agency, may place an order. The order must reference the lease number.

(d)  Payment. Do not make final payment for services and utilities until confirmed as delivered in a satisfactory manner.

Insert provisions or clauses substantially the same as the FAR provisions and clauses listed below.

Each SFO must include provisions substantially the same as the following, unless the contracting officer determines that the provision is not appropriate. The contracting officer shall document the file with the basis for omitting or substantially changing a provision.

(a) Insert clauses substantially the same as the following in solicitations and contracts for leasehold interests in real property that exceed the simplified lease acquisition threshold, unless the contracting officer determines that a clause is not appropriate. The contracting officer shall document the file with the basis for omitting or substantially changing a clause. A deviation is not required under section 570.704 to determine that a clause in this section is not appropriate. The following clauses may be inserted in solicitations and contracts for leasehold interests in real property at or below the simplified lease acquisition threshold.

(b) Insert the following clauses in solicitations and contracts for leasehold interests in real property:

(c)Insert the representation clause at 552.270-33, Foreign Ownership and Financing Representation for High-Security Leased Space, in novations, solicitations and contracts for leased space that:

(1)Will be occupied by Federal employees for nonmilitary activities; and

(2)Has a facility security level of III, IV, or V.

(d)Insert the clause at 552.270-34 Access Limitations for High-Security Leased Space, in novations, solicitations and contracts for leased space that:

(1)Will be occupied by Federal employees for nonmilitary activities; and

(2)Has a facility security level of III, IV, or V.

(a)  The contracting officer needs a deviation approved under Subpart 501.4 to omit any required provision or clause.

(b)  The contracting officer also needs an approved deviation to modify the language of a provision or clause mandated by statute (e.g., FAR 52.215-2, Audit and Records—Negotiation). The authorizing statute must allow for a waiver.

(c) Certain clauses required by non-GSA regulations require approval of the issuing agency before the contracting officer can delete or modify them. For example, FARs 52.222-26, Equal Opportunity; 52.222-35, Affirmative Action for Disabled Veterans and Veterans of the Vietnam Era; and 52.222-36, Affirmative Action for Workers with Disabilities, require the approval of the Department of Labor’s Office of Federal Contract Compliance Programs before they can be deleted from or modified in the SFO or lease.

(a)  The contracting officer may use GSA Form 3626, U.S. Government Lease for Real Property (Short Form), to award leases if using the simplified leasing procedures in Subpart 570.2 or if the contracting officer determines it advantageous to use the form.

(b)  The contracting officer may use GSA Form 1364, Proposal To Lease Space, to obtain offers from prospective offerors.

(c)  The contracting officer may use GSA Form 1217, Lessor's Annual Cost Statement, to obtain pricing information regarding offered services and lease commissions.