Under the National Broker Contract, four nationwide contracts have been awarded. Each contract has a small business set-aside goal of 23 percent that was evaluated as part of the award. All successful offerors are to meet or exceed this goal. The contracts were awarded as a 1 year base and can be extended for a total of five years, subject to annual renewal options.

The Government Accountability Office Advisory Ruling allows GSA to enter into contracts with real estate brokers without augmenting its appropriations since the proposed contracts do not contemplate the government receiving funds from the brokers. This contract vehicle is what we are commonly calling the "No Cost" contract. It is where the contractor will negotiate and collect the commissions typically paid in the private sector as payment for contract services with no payments being made directly by the government.

Under the National Broker Contract, four nationwide contracts were awarded to the real estate companies of Jones Lang LaSalle Americas Inc., Julien J. Studley, Inc., the Staubach Company, and Trammell Crow Company.

These four contracts were awarded as modified performance-based contracts with a 1 year base period, and they can be extended for a total of five years, subject to annual renewal options. The contracts were awarded on October 4, 2004. Contractor's were provided Notice to Proceed on April 1, 2005. The base contract year began on April 1, 2005, and runs through March 31, 2006.

Each awarded contract has a Government imposed target set aside goal of 23 percent of the total contract value to be specifically subcontracted with small businesses. Some of the contractors have a self imposed substantially higher target goal. This represents an extraordinary commitment to small business concerns.

To be able to deliver high-quality leased space in a consistent manner at the best value for customer agencies. It will minimize confusion for our government agency clients and will allow PBS associates to better manage the entire space delivery process so that customers can concentrate on their core missions. The contract will allow GSA to leverage our position in the market that will enable us to negotiate the best market rates for our customers.

No, the customers will not be charged any additional fee for work accomplished by Brokers. Under this contract, the National Brokers are collecting their fees in commissions from the landlord. In previous contracts, GSA paid the broker fees under traditional services contracts for no commissions. Any commissions were negotiated or rebated back as an offset to the lease. Under the new "no cost" contract, the contractor will have the opportunity collect the commissions they negotiate with the landlord minus a pre-priced percentage of the commissions that will be applied to the customers' shell rent. The customer will benefit directly and immediately from any commission credits. Under an expedited lease action, GSA and the customer will receive no commission offset to rent.

GSA Realty Professionals will continue to be the primary contact and the focal point for all transactions. The National Broker Contract is one of the tools for our Realty Associates, to add capacity in servicing our customers.

In coordination with our GSA/PBS Human Capital Strategy, increased emphasis is placed on understanding our customers better. We are integrating our business process into the Transaction Management Playbook to improve our customer interactions. The National Broker Contracts contain the process to facilitate that interaction by the means of project orientation discussions among the GSA Realty Specialist, the Customer, and the Broker. At the project orientation meeting, a communication plan is developed by all parties in order to ensure the communications flow is being conducted in the manner and frequency the agency would like to receive. Communications contacts, as well as approval authority, are to be clearly identified and adhered to by all.

The brokers are not an approval level in the leasing process. Their work is strictly monitored through GSA oversight and contract compliance reviews. The GSA Realty Specialist is, and shall remain, the primary point of contact for the customer from the initial notification throughout the entire project until occupancy. Under previous contracts the customer was, in several cases, left to work with the contractor with no oversight or management by the GSA Realty Specialist. Under the new contract, GSA has instituted new internal management controls for improved oversight.

We anticipate better rental rates for our customers from the National contractors due to the fact their future work with GSA is dependent on their performance on each individual project. One of the performance criteria we will monitor is the rental rates they negotiate.