Comptroller General

United States Government Accountability Office 

Washington, DC 20548 

of the United States

 

Decision 

Matter of: Exec Plaza, LLC--Costs 

File: B-400107.3 

Date: October 24, 2008 

Fernand A. Lavallee, Esq., Jeffery R. Keitelman, Esq., and Eric M. O’Neill, Esq., DLA 

Piper US LLP, for the protester. 

Edith Toms, Esq., and Elizabeth Johnson, Esq., General Services Administration, for 

the agency. 

Jonathan L. Kang, Esq., and Ralph O. White, Esq., Office of the General Counsel, 

GAO, participated in the preparation of the decision. 

DIGEST 

Request for a determination of entitlement to costs is denied because, although the 

agency issued a clarifying amendment in response to a protest allegation, the 

protester’s argument was not clearly meritorious and therefore the agency’s 

amendment cannot be considered as corrective action in the face of a clearly 

meritorious protest. 

DECISION 

Exec Plaza, LLC (Exec) requests that our Office recommend that the General 

Services Administration (GSA) reimburse its costs of filing and pursuing its protest 

of the terms of solicitation for offers (SFO) No. 08-008. Specifically, Exec requests 

that we recommend reimbursement of the protester’s costs associated with its 

challenge to terms of the SFO that were amended by the agency during the course of 

the protest. 

We deny the request. 

The SFO was issued on February 29, 2008, and sought offers for the lease by GSA of 

approximately 574,164 square feet of office space in Rockville, MD, on behalf of the 

National Cancer Institute (NCI). At the time of the protest, GSA leased office space 

for NCI under multiple leases in Rockville from Exec and another lessor. 

Exec filed a protest challenging the terms of the SFO on April 25, arguing that the 

SFO was unduly restrictive of competition because it placed numerous requirements 
on incumbent lessors, such as Exec, that did not apply to other offerors. As relevant 

here the protester argued that the SFO required incumbent lessors, but not other 

offerors, to demolish existing tenant improvements in their proposed properties. 

Exec argued that this requirement placed it at a competitive disadvantage as 

compared to other offerors who would not be required to demolish their existing 

improvements. 

In its report on the protest, GSA argued that the SFO required all offerors to 

demolish existing tenant improvements. Agency Report (AR) at 9. The agency 

further argued that the requirement, as applied to all offerors, was reasonable and 

was not unduly restrictive of competition. In a supplemental protest, Exec argued

that the agency’s position regarding the applicability of the demolition requirement 

to all offerors was not reflected in the SFO. In its supplemental agency report, GSA 

reiterated its view that the demolition requirement applied equally to all offerors. 

Supp. AR at 3. 

Nonetheless, GSA’s supplemental report also announced that it was issuing 

amendment No. 2 to the SFO, which would more clearly state that the demolition 

requirement applied to all offerors. GSA argued that SFO amendment No. 2 

rendered the protest concerning the demolition requirement academic because it 

made clear that the requirement did not apply uniquely to Exec. In its comments on 

the supplemental agency report, Exec argued that the amended SFO still did not

resolve its argument that the demolition requirement unduly restricted the 

protester’s ability to compete for the contract. The protester also argued, however, 

that the amendment of the solicitation constituted corrective action in response to

the initial protest, and requested that our Office recommend that the protester be 

reimbursed its costs of pursuing this aspect of its protest. 

On August 1, we denied the protest. We concluded that certain of the challenged

SFO requirements applied equally to all offerors, and that they did not uniquely 

prejudice Exec’s ability to compete for the contract. As relevant here, we concluded 

that the amended SFO made clear that the demolition requirement applied to all 

offerors. With regard to the balance of the challenged SFO requirements, we 

concluded that although several of them applied uniquely to the incumbent lessors, 

like Exec, the competitive disadvantage they imposed was not unreasonable. 

DISCUSSION 

Exec requests that we recommend that the agency reimburse its costs of pursuing its 

protest concerning the demolition requirement. GSA argues that reimbursement is 

not warranted here because the original solicitation required all offerors to demolish 

existing tenant improvements, and that, notwithstanding the agency’s amendment of 

the SFO to make the matter more clear, the protester’s argument was without merit. 

We agree with GSA. 

Page 2 B-400107.3
Our Bid Protest Regulations, 4 C.F.R. § 21.8(e) (2008), provide that we may 

recommend that an agency reimburse a protester’s costs of pursing a protest where 

the agency decides to take corrective action in response to the protest. We will 

make such a recommendation, however, only where the agency unduly delayed 

taking corrective action in the face of a clearly meritorious protest, thereby causing a 

protester to expend unnecessary time and resources to make further use of the 

protest process in order to obtain relief. Information Ventures, Inc.-Costs, 

B-294567.2, Nov. 16, 2004, 2004 CPD ¶ 234 at 2. A protest is clearly meritorious 

where a reasonable agency inquiry into the protest allegations would have shown 

facts disclosing the absence of a defensible legal position. AVIATE LLC, B-275058.6, 

B-275058.7, Apr. 14, 1997, 97-1 CPD ¶ 162 at 16. As a general rule, so long as an 

agency takes corrective action by the due date of its protest report, we regard the 

action as prompt, and will not consider a request to recommend reimbursement of 

protest costs. CDIC, Inc.-Entitlement to Costs, B-277526.2, Aug. 18, 1997, 97--2 CPD 

¶ 52. 

Here, we think the record shows that Exec’s initial argument was not clearly 

meritorious. As discussed above, Exec’s initial protest argued that the SFO required 

only the incumbent lessors to demolish existing tenant improvements. The SFO set

forth specific provisions that applied only to incumbent lessors, including the 

following requirement for demolition of existing improvements: 

The majority of this requirement is currently located at 6116, 6120 and 

6130 Executive Boulevard, Rockville, MD (the “Executive Boulevard 

Properties”). Modernization of the Executive Boulevard Properties 

may be a potential solution for this procurement. A modernization of

the Executive Boulevard Properties will be required to meet all of the 

requirements of this SFO, including the Occupancy Date requirements 

of Section 1.7. The SFO outlines a level of base building requirements 

and tenant improvements that will require all or portions of the 

building to be vacant from time to time during modernization. In

addition, existing tenant improvements in Executive Boulevard 

Properties must be demolished and replaced with new tenant

improvements in accordance with the Government’s Program of 

Requirements and approved plans. 

SFO § 1.20A. 

While the original SFO did not specifically state that non-incumbent offerors were 

required to demolish existing tenant improvements, it stated that all offerors were 

required to propose their office space as a “building shell.” 1 SFO § 1.9. The building 

 1

 As discussed in our decision resolving the underlying merits of the protest, “warm

lit shell” is a common industry term, referring to basic building structure elements. 

Exec Plaza, LLC, B-400107, B-400107.2, Aug. 1, 2008, 2008 CDP ¶ 143 at 3. While the 

(continued...) 

Page 3 B-400107.3
shell requirements applicable to all offerors stated that the proposed office space 

must have complete base structures, accessible common areas, and systems such as 

heating, ventilation, air conditioning, electrical, and sprinklers. Id. The SFO 

required offerors to propose a base price for the building shell, and provided 

separately for a fixed allowance for the construction of new tenant improvements to

meet the government’s requirements. GSA states that this approach allows the 

government to evaluate offerors on a common basis, without having to take existing 

tenant improvements into consideration.2 AR at 9. 

Amendment No. 2 added a new section to § 1.9, which applied to all offerors, as

follows: 

Demolition. All required demolition is at the Lessor’s expense and 

offers should be priced accordingly. Notwithstanding § 1.11(A)(4), any 

offeror proposing an existing building with existing tenant

improvements must assume that all existing improvements must be 

demolished in order to provide for the Government’s new POR. 

SFO amend. 2 § 1.9(A).

To conclude that the protester’s original argument was clearly meritorious, we 

would need to agree with the protester that the solicitation, as originally issued by 

GSA and challenged by Exec, was defective. We do not agree. 

As discussed above, all offerors were required to propose office space as a building 

shell, i.e., empty space with only basic elements such as utilities and safety systems. 

GSA concedes that the SFO did not specifically state that non-incumbents would 

need to assume demolition of existing tenant improvements. However, GSA argues 

 

(...continued) 

non-incumbent-specific SFO provisions refer to a “building shell,” and the 

incumbent-specific provisions refer to a “warm lit shell,” SFO §§ 1.9, 1.20, GSA states 

that for purposes of the SFO, the terms “building shell” and “warm lit shell” are 

interchangeable. Supp. AR at 5. We think the record supports this view, as SFO 

§ 1.20 states that the incumbent offeror must provide a “‘warm lit shell’ consistent 

with the definition of such in Section 1.9 of this SFO.” SFO § 1.20(C). 

2

 In a decision addressing a similar argument, we concluded that a requirement to 

propose leased office space as a building shell was reasonable because it allowed 

GSA to evaluate offerors on a common basis. See Paramount Group, Inc., 

B-298082, June 15, 2006, 2006 CPD ¶ 98 at 3. In Paramount, the protester argued that 

the requirement to propose space as a building shell was unreasonable because it 

required the protester, the incumbent lessor, to demolish its existing tenant

improvements. 

Page 4 B-400107.3
that the solicitation clearly and necessarily implied that the SFO required demolition 

of existing tenant improvements, to the extent that all existing improvements must 

be removed so that the office space is reduced to the status of the required building 

shell. AR at 9. 

We agree with the agency that proposing office space as a building shell means that

an offeror must assume demolition of all existing improvements. Additionally, 

although the initial SFO more explicitly stated this requirement for incumbent

offerors, we do not think the elsewhere-stated, but essentially duplicative provisions

requiring a building shell, excused non-incumbents from demolishing existing tenant

improvements. 

Finally, we do not think that GSA’s decision to amend the solicitation demonstrates

that the protester’s initial argument was correct, even though we agree that

amendment No. 2 more clearly stated the requirement. As discussed above, we think 

that the initial solicitation advised all offerors that existing tenant improvements

required demolition. Therefore, we conclude that agency’s corrective action was not 

taken in response to a clearly meritorious protest, and we do not recommend that

Exec be reimbursed its protest costs. 

The request is denied.

Gary L. Kepplinger 

General Counsel 

Page 5 B-400107.3