Army wants military construction 50% faster. Lawyers warn contractors will carry more risk

The Army announced the initiative in October. It favors design-build and industrialized methods such as modular construction over the usual design-bid-build sequence, Construction Dive reported. The fiscal 2026 National Defense Authorization Act, meanwhile, widened the Defense Department's power to sign Other Transaction Agreements (OTAs) for building and repairing facilities. Until now OTAs in military construction were limited to a pilot program for new building technologies, with caps on the number and value of projects, said Stephen Tobin of the law firm Cohen Seglias. The new authority covers planning, design and execution and can lead to a follow-on production contract awarded without competition.

Builders are already positioning. Tutor Perini has pointed to $315 million in Coast Guard work at Base Kodiak, Alaska, delivered under an accelerated design-build-to-budget method. Granite Construction CEO Kyle Larkin told analysts on Oct. 29 that the shift suits his company's record with collaborative contracts.

The risk sits in the agreement itself. OTAs generally fall outside the Federal Acquisition Regulation, so FAR clauses contractors rely on may be missing unless they negotiate them in, Tobin said. Protest rights are narrower as well: the Government Accountability Office usually reviews only whether an agency had authority to use an OTA, and does not revisit how it picked the winner. Trent Cotney of Adams & Reese said compressed schedules and incomplete designs expose builders to higher costs, labor shortages, unforeseen site conditions and schedule disputes. Douglas Proxmire of Venable said design-build moves design and construction risk onto the contractor, although the Army keeps part of the design risk.

Tobin added that earlier federal pushes to speed up buying produced mixed results, with loosely defined requirements later turning into claims after award.