With Q4 just a month or so away, this federal construction market update is a timely reminder that the busiest—and most critical—period of the fiscal year is fast approaching. As agencies prepare to obligate remaining funds before September 30, contractors who get ready now will be in the best position to seize opportunities, navigate compliance changes, and overcome common challenges.
If you’re in the federal construction space, this quarter can make or break your year. Here’s what you need to know to finish strong—and start setting the stage for FY26.
The Year-End Funding Surge
At this point in the fiscal calendar, agencies can no longer wait. Any unspent money from their FY25 budgets must be obligated by the end of September or risk being lost. That urgency turns Q4 into a season of rapid-fire RFPs, last-minute task orders, and high-value project awards.
Several key program areas are seeing strong end-of-year funding pushes:
- Infrastructure projects on military bases and federal lands
- Facility upgrades for healthcare and educational institutions
- Energy-efficiency retrofits and sustainable construction initiatives
Agencies like the U.S. Army Corps of Engineers (USACE), NAVFAC, VA, and the National Park Service are at the forefront, pushing out solicitations and finalizing awards. If you’re paying close attention to SAM.gov and GovWin, you’ll notice a spike in activity—and that’s only going to ramp up in the weeks ahead.
Bid Activity Is Up—and So Is Competition
With more funding hitting the market, bid opportunities are abundant—but competition is fierce. You’re not the only one trying to capture year-end dollars. Contractors across the country, from large primes to small businesses, are pursuing contracts at a rapid pace.
We’re seeing high volumes of solicitations for:
- Multi-year IDIQs and MATOCs
- Civil works and base operations support
- Small-scale A/E services and minor construction scopes
Success in Q4 bidding comes down to responsiveness and preparation. Contractors who keep their compliance documentation updated and their proposal teams sharp will have a clear advantage. Expect tight turnaround times, especially on projects where agencies need to obligate funds fast.
Evolving Compliance Standards
Even with the urgency of Q4, agencies aren’t relaxing expectations—if anything, compliance standards are getting tighter. Contractors need to be aware of a few evolving requirements:
- The Buy American Act is under closer scrutiny. Make sure your materials and products meet domestic sourcing guidelines.
- OSHA compliance is being prioritized during site visits, especially regarding fall protection and jobsite safety plans.
- Environmental documentation requirements have expanded. More agencies are requiring detailed SWPPP (Stormwater Pollution Prevention Plans) and AHAs (Activity Hazard Analyses) on new starts.
Staying ahead of these requirements isn’t just about avoiding delays—it could be the difference between getting selected or getting sidelined.
Project Execution Challenges
Winning work is only half the battle. Getting projects off the ground in Q4 comes with its own set of hurdles.
Skilled labor continues to be a challenge. Roles like SSHOs, QCMs, and experienced superintendents are in short supply, and many firms are supplementing with 1099 field personnel or staffing partners to stay agile. If you’re not already building your labor pipeline for upcoming work, now’s the time.
Material availability is still hit or miss. While some supply chain issues have improved, items like HVAC components, switchgear, and specialty electrical gear continue to experience long lead times. Early procurement planning and supplier diversification remain essential to avoid delays after award.
Agency-side bottlenecks are also something to plan around. Contracting offices are stretched thin this time of year, which can slow down design approvals and Notices to Proceed. If your team is ready but the agency isn’t, make sure you’re protecting your schedules with accurate project controls and clear communication.
Strategies to Finish Q4 Strong
With so much activity and pressure, the contractors who succeed in Q4 are the ones who stay focused and flexible. Here are a few strategies that can give you a competitive edge:
Stay proposal-ready. Keep all your certifications, safety records, QC plans, and past performance info up to date and easily accessible. The quicker you can turn around a clean, compliant bid, the better your chances.
Use flexible staffing. If you’re struggling to staff a project quickly, partnering with a firm that provides pre-vetted 1099 professionals can be a lifesaver. Don’t let labor shortages keep you from moving on a job.
Strengthen your scheduling. Use tools like Microsoft Project or Primavera P6 to build detailed, realistic project schedules. Consider running Time Impact Analyses early to help protect against delays and change orders.
Engage early and often. Communication with contracting officers is critical in Q4. Building trust and staying top-of-mind can help when last-minute awards are being made.
Looking Toward FY26
While Q4 is all about urgency, don’t lose sight of what’s next. This is also the time to gather lessons learned, review your win/loss data from earlier in the year, and refine your go-to-market strategy for FY26.
Keep an eye on growing sectors like sustainable construction, digital infrastructure upgrades, and energy resilience initiatives. These areas are expected to receive even more attention in the new fiscal year—and contractors who are paying attention now will be ready when those opportunities hit the street.
Q4 Market Update Recap: Be Ready, Stay Competitive
Q4 is intense. It’s fast-paced, competitive, and full of potential. But for contractors who are organized, compliant, and ready to move, it’s also one of the best times of the year to win new work and build momentum.
Get your documents in order. Keep your teams flexible. Watch the bid platforms closely. And most importantly—stay proactive. Contractors who are ready now won’t just finish the year strong—they’ll head into FY26 ahead of the pack.