NAICS 236220 (Commercial Building) - Buyers, Vehicles, and Small-Business Playbook
Federal commercial building construction is a $38.2B annual market spanning hospitals, schools, data centers, and courthouses. NAICS 236220 requires mastering FAR Part 36 procedures, Miller Act bonding, and Davis-Bacon wages plus navigating multi-award vehicles like MACCs and MATOCs. Below, we break down the key buyers, contract vehicles, and small-business tactics you need to win.
TL;DR
- NAICS 236220 = commercial and institutional building construction for hospitals, schools, courthouses, data centers, warehouses, barracks, and more.
- The market is $38.2B in awards over the last year across 9,359 posted contracts, with 1,923 active winning companies.
- Multi-award vehicles dominate (MACC/MATOC/IDIQ) with downstream task-order competitions.
- Compliance-heavy: Miller Act bonding, Davis-Bacon wages, FAR Part 36 construction clauses.
- Small-business friendly via SB, 8(a), SDVOSB, and HUBZone set-asides.
- See live data and solicitations: NAICS 236220
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NAICS 236220: How to Win Federal Commercial Building Work in 2025
Federal vertical construction operates under a different set of rules than services contracting. Success requires mastering FAR Part 36 procedures, Miller Act bonding requirements, and Davis-Bacon wage compliance while navigating complex multi-award construction vehicles like MACCs and MATOCs.
Unlike IT services where technical approach drives selection, construction awards often hinge on past performance with similar building types, bonding capacity, and price realism under prevailing wage requirements.
What NAICS 236220 Covers
NAICS 236220 encompasses commercial and institutional building construction, including:
- Medical facilities: Hospitals, clinics, research labs, medical office buildings
- Educational buildings: Schools, universities, training centers, libraries
- Government facilities: Courthouses, office buildings, detention centers
- Infrastructure: Data centers, warehouses, maintenance facilities, fire stations
- Military construction: Barracks, dining facilities, administrative buildings
- Specialized facilities: Airport terminals, parking garages, secure facilities
The key distinction from residential (236115) or heavy/civil (237xxx) codes is that 236220 focuses on vertical commercial structures with complex mechanical, electrical, and technology systems. See all NAICS codes and their descriptions →
Who Buys 236220 (Major Agencies & Districts)
Federal construction buying is concentrated among a few major players, each with distinct procurement patterns and preferred vehicles:
| Agency/Command | Annual Volume | Typical Project Size | Primary Vehicles | Focus Areas |
|---|---|---|---|---|
| USACE Districts | $1.8B | $5-50M | MACC, District IDIQs | Military facilities, federal buildings |
| NAVFAC | $892M | $3-35M | MATOC, Regional IDIQs | Navy/Marine facilities, ports |
| GSA PBS | $634M | $8-75M | Regional IDIQs, Direct | Courthouses, federal buildings |
| VA Medical Centers | $511M | $2-25M | VISN IDIQs, Direct | Hospitals, clinics, research labs |
| Air Force Civil Engineering | $387M | $1-20M | Base IDIQs, Direct | Hangars, barracks, facilities |
USACE leads the market with $1.8B across multiple districts, focusing on design-build delivery for military construction. Each district maintains its own MACC (Multiple Award Construction Contract) with 8-15 pre-qualified contractors.
NAVFAC operates regionally with MATOC (Multiple Award Task Order Contract) vehicles, typically running 5-year base periods with competitive task orders for specific projects.
GSA PBS handles civilian facilities with a mix of regional IDIQs and direct awards, often requiring specialized experience with courthouse security or historic preservation.
District Strategy: Focus on 2-3 districts where you can build relationships and past performance. Travel costs and local subcontractor networks make geographic concentration essential.
Contract Vehicles & Competition Patterns
Federal construction relies heavily on multi-award IDIQ vehicles that pre-qualify contractors, then compete individual projects as task orders:
MACC/MATOC Structure
| Vehicle Type | Contract Period | Awardees | Task Order Range | Typical Delivery |
|---|---|---|---|---|
| USACE MACC | 5 years | 8-15 | $1M-$65M | Design-Build |
| NAVFAC MATOC | 5 years | 6-12 | $500K-$45M | Design-Build, D-B-B |
| GSA Regional IDIQ | 5-10 years | 4-8 | $2M-$100M | Design-Bid-Build |
| VA VISN IDIQ | 5 years | 5-10 | $250K-$25M | Design-Build |
Competition Patterns
IDIQ On-Ramp: Initial vehicle awards use best-value tradeoff with heavy emphasis on past performance (40-50% weight) and technical approach (30-40%). Price typically accounts for 15-25%.
Task Order Competition: Among pre-qualified contractors, competitions shift toward price-technical tradeoff with more balanced evaluation factors (price 30-50%).
Direct Awards: For specialized or urgent work, agencies issue traditional IFBs (sealed bid, low price) or RFPs (best-value) outside the IDIQ framework.
Timing Strategy: IDIQ recompetitions typically occur every 5-7 years. Track expiration dates and prepare 12-18 months ahead-these are your entry points to major agency work.
Compliance Requirements That Make or Break Bids
Federal construction has unique regulatory requirements that don't apply to services contracts:
Miller Act Bonding
All contracts >$150K require:
- Performance Bond: 100% of contract value
- Payment Bond: 100% of contract value
- Bid Bond: 10-20% of bid amount (if specified)
Surety capacity becomes your limiting factor. Most small contractors can secure $2-5M in single project bonding; larger projects require prequalification and higher bonding limits.
Davis-Bacon Wage Requirements
All federal construction must pay prevailing wages as determined by DOL:
- Wage determinations issued by location and building type
- Fringe benefits often add 30-50% to base wage rates
- Certified payroll required weekly during construction
- Penalties for non-compliance include contract termination
FAR Part 36 Construction Clauses
Expect different risk allocation than services contracts:
- Site investigation: Contractor responsible for site conditions
- Weather delays: Typically contractor risk except for unusual weather
- Material availability: Supply chain disruptions are contractor responsibility
- Differing site conditions: May provide equitable adjustment if documented properly
Compliance Tip: Budget 2-3% of contract value for bonding premiums and payroll compliance. Factor prevailing wage rates early-they can be 40-60% above commercial rates in high-cost areas.
Small-Business Set-Aside Opportunities
Federal construction consistently uses small-business set-asides across all major agencies:
Set-Aside Usage by Agency
| Agency | SB Set-Aside % | 8(a) % | SDVOSB % | HUBZone % |
|---|---|---|---|---|
| USACE | 41% | 23% | 18% | 8% |
| NAVFAC | 38% | 19% | 22% | 11% |
| GSA PBS | 47% | 15% | 16% | 12% |
| VA | 52% | 11% | 31% | 6% |
Size Standards & Thresholds
- Standard Size: $47M average annual receipts (3-year average)
- 8(a) Threshold: Same $47M standard with additional program requirements
- SDVOSB/VOSB: Same $47M standard plus veteran ownership requirements
- HUBZone: $47M standard plus qualified location requirements
Competitive Advantages for SB Contractors
Reduced competition: Set-aside competitions typically see 4-8 bidders vs. 12-20 for unrestricted competitions.
Past performance weighting: Agencies often accept similar work complexity from smaller projects, giving SB contractors more relevant experience to cite.
Subcontracting opportunities: Large primes need SB partners for subcontracting plan compliance-leverage this for teaming on unrestricted work.
Geographic proximity: Local knowledge and subcontractor relationships provide competitive advantages that are difficult for large national firms to replicate.
Additional set-aside opportunities: Beyond the major programs above, WOSB/EDWOSB certifications can provide access to additional construction opportunities, particularly in civilian agency work.
Certification Tip: Maintain your SBA certifications proactively. SAM.gov registration lapses can disqualify you from awards even if your underlying certification is valid.
Pricing Strategy & Risk Management
Construction pricing requires different approaches than services due to material costs, weather risk, and site conditions:
Cost Categories & Typical Ranges
| Cost Category | % of Total | Risk Level | Key Variables |
|---|---|---|---|
| Labor (DB wages) | 35-45% | Medium | Prevailing wage rates, fringe benefits |
| Materials | 30-40% | High | Steel/concrete prices, long-lead items |
| Subcontractors | 40-60% | Medium | Specialties, availability, pricing |
| Equipment | 5-10% | Low | Rental rates, fuel costs |
| Overhead & Profit | 8-15% | Low | Company rates, project complexity |
| Bonding/Insurance | 2-3% | Low | Surety rates, loss history |
Risk Mitigation Checklist
Site conditions: Budget for geotechnical investigation and environmental testing. Differing site conditions claims require thorough documentation.
Schedule compliance: Federal projects have fixed completion dates with liquidated damages. Build realistic schedules with weather and permit contingencies.
Material escalation: Consider price escalation clauses for contracts >18 months, especially for steel-intensive or specialized building types.
Subcontractor coverage: Secure written quotes with defined scope. SB set-asides often limit subcontractor pool, requiring earlier procurement.
Cash flow management: Federal payment schedules can be 30-45 days. Plan working capital needs accordingly.
Pricing Reality: Winning bids are typically within 5-10% of engineer's estimate. Significantly low bids trigger responsibility determinations; high bids lose on price.
Capture Strategy That Wins
Successful federal construction capture differs from services-relationships matter, but past performance and technical capability drive selection:
Pre-Positioning (12-18 Months Out)
District mapping: Identify your target districts and build relationships with contracting officers, resident engineers, and program managers.
Vehicle tracking: Monitor IDIQ expiration dates and on-ramp opportunities. These are your entry points to sustained revenue streams.
Past performance development: Target smaller direct awards to build relevant past performance for larger IDIQ competitions.
Bonding capacity: Work with your surety to establish higher bonding limits. This capability becomes a key differentiator.
Active Capture (RFP Release)
Site investigation: Walk the site, document constraints, and verify utility information. Federal sites often have access restrictions and operational constraints.
Subcontractor outreach: Secure written quotes early, especially for specialized trades. SB set-asides may limit your subcontractor pool.
Design review: For design-build, invest in thorough design development. Cookie-cutter approaches rarely win federal work.
Price-to-win analysis: Build unit-rate databases from recent awards and validate against current material and labor costs.
Proposal Development
Past performance narrative: Focus on similar building types, contract values, and delivery methods. Federal evaluators weight relevance heavily.
Technical approach: Address site-specific challenges (security, phasing, utility coordination) with detailed solutions.
Safety record: EMR (Experience Modification Rate) 1.0 is often mandatory. Highlight safety programs and training.
Schedule realism: Show detailed CPM schedules with permit timelines, long-lead procurement, and weather considerations.
Frequently Asked Questions
What does NAICS 236220 cover exactly?
NAICS 236220 covers commercial and institutional building construction-hospitals, schools, courthouses, data centers, federal office buildings, and military facilities. It excludes residential construction (236115) and heavy/civil work like roads or utilities (237xxx codes).
Which agencies offer the best opportunities for small businesses?
VA shows the highest SB set-aside rate (52%) with strong SDVOSB opportunities (31%). GSA PBS follows at 47% SB set-asides. Both agencies offer manageable project sizes ($2-25M typical) that fit small contractor bonding capacity.
How do I get on a MACC or MATOC vehicle?
These IDIQ vehicles recompete every 5-7 years. Track expiration dates through federal contract databases and prepare 12-18 months ahead. Awards emphasize past performance (40-50% weight) with similar building types and contract values. You need relevant federal construction experience to be competitive.
What bonding capacity do I need for federal construction?
Most opportunities require $2-10M single project capacity. Larger IDIQ vehicles may require $20-50M+ aggregate bonding. Work with your surety early to establish higher limits-this capability often determines which opportunities you can pursue.
How do Davis-Bacon wages affect pricing?
Prevailing wages typically run 40-60% above commercial rates in high-cost areas. Factor in both base wages and fringe benefits (often 30-50% additional). Build current wage determinations into your pricing models and budget for weekly certified payroll administration.
What's the difference between design-build and design-bid-build?
Design-Build: You provide both design and construction under a single contract. Requires in-house design capability or A/E teaming partners. Common for USACE and NAVFAC work.
Design-Bid-Build: Government provides complete plans and specifications; you bid construction only. Traditional approach used by GSA PBS and many civilian agencies.
Stop Bidding Blind. Start Winning Federal Construction.
The 236220 market rewards contractors who understand agency buying patterns, track vehicle opportunities, and build relevant past performance systematically.
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About CLEATUS
CLEATUS is an AI-powered government contracting platform that helps software development teams find opportunities, analyze requirements, track competitors, and win more contracts—at a fraction of traditional capture costs. We aggregate federal, state, local, and city opportunities; our GovCon Copilot analyzes solicitations and your internal documents to deliver actionable market intelligence that drives revenue growth.