Press Release: Offeror selected to privatize Northern Group housing

  • Published
  • By Air Force Center for Engineering and the Environment
  • Public Affairs
LACKLAND AIR FORCE BASE, Texas --  The Air Force has identified Balfour Beatty Communities to privatize housing for the Northern Group project. The Northern Group includes Cannon AFB, N.M.; Grand Forks AFB, Minot AFB and Cavalier AFS, N.D.; Ellsworth AFB, S.D.; and Mountain Home AFB, Idaho. The deal, valued at $468.9 million in development costs, provides new and renovated housing for 4,761 military families using only $7.4 million in appropriated funds.

Balfour Beatty Communities, LLC, a subsidiary of Balfour Beatty Capital Group, Inc., is responsible for the development, renovation, operation and management of military housing privatization projects for the Departments of the Air Force, Army and Navy. The company is a leader in the military housing public-private partnership industry, and provides services to members of the military and their families residing on or near 43 installations located in 20 states and Washington, D.C. Based in Newtown Square, Penn., the company employs approximately 1,000 people nationwide.

Under the deal, the Air Force will lease up to 2,056 acres of land as part of a 50-year transaction and convey 4,794 existing housing units and other improvements to BBC. At the end of the initial development period, 1,165 units will be new, 367 will be renovated, 3,229 units will remain "as is" with no improvements necessary, and 1,198 units will be demolished. Community amenities are included in the deal.

At closing, the houses become property of BBC who will own and operate the rental housing development for military families, as well as finance, plan, design and construct improvements in the development that maintain at least 4,761 housing units for the 50-year lease period.

"The Air Force chose Balfour Beatty Communities, LLC, after determining that it offered the most advantageous proposal considering all of the criteria in the request for qualifications," said Eric Staph, Air Force Center for Engineering and the Environment project manager.

In 1996, Congress created the Military Housing Privatization Initiative as part of the National Defense Authorization Act. The goal was to provide military members with quality homes faster than through military construction alone.

According to Ian Smith, deputy chief of AFCEE's Housing Privatization Division, the Air Force has accomplished in 10 years through housing privatization what would have taken 25 years using traditional military construction, or MILCON, and saved the taxpayer billions in the process.

"The Air Force has privatized more than 40,000 homes at 47 bases at a cost to the Air Force of $469.4 million, and brought in $7.1 billion in private funding to provide quality homes for our Airmen," Smith said.

AFCEE, headquartered in San Antonio, Texas, serves as the primary Air Force service agent for housing privatization efforts including completing feasibility analyses, developing project concepts and solicitations, and providing support to the integrated acquisition teams that execute projects.

For general information regarding the Air Force housing privatization program, visit: www.afcee.af.mil/resources/housingprivatization/index.asp.