Midway Partnership LLC, a joint venture comprised of Hudson Group, SSP America and Vantage Airport Group, is closing in on a deal that would put the trio of companies in charge of overhauling and expanding the concessions program at Midway (MDW).
Chicago Mayor Rahm Emanuel this week introduced an ordinance that would allow the city to enter a 15-year agreement with Midway Partnership to lease, develop, manage and operate concessions there.
The agreement would double the number of concessions jobs at the airport from 700 to 1,400 and create 250 jobs during construction. It would increase the concessions area by 26,000 square feet for a total of nearly 70,000 square feet of space dedicated to food and beverage, news and gift, specialty retail, duty free, personal service and other public amenities.
Under terms of the proposed deal, Midway Partnership would invest $75 million to renovate and expand concessions. The new program is projected to increase annual sales tax revenue to the city by $10 million, according to a statement from the mayor’s office.
“This agreement is an investment in Chicago, creating jobs, highlighting local businesses and improving the airport’s overall passenger experience,” Emanuel says. “It also marks an important step forward in our overall plan to modernize Midway and increase the airport’s competitive viability for the future.”
When finished, the program will feature iconic Chicago establishments and brands and nationally recognized products and services. Airport Concessions Disadvantaged Business Enterprise program participation is slated to grow from 34 percent to 41 percent, which the city says is the most aggressive commitment the Chicago Department of Aviation has ever undertaken at its airports. Fifteen local firms are represented in the ACDBE plan, according to the city’s statement.
Sales per enplanements are projected to double after completion. MDW serviced 21,992,360 passengers in 2015 and generated $72.3 million in gross sales, for sales per enplaned passenger of $6.57, according to ARN’s 2016 Fact Book. Doubling that to just over $13 per enplaned passenger would have ranked the airport the sixth top-performing airport in North America, according to ARN.
The Midway Partnership proposal was selected by an independent evaluation committee comprised of industry experts.
The overall Midway Modernization Program, which is slated to cost roughly $248 million, also will include an expansion of the passenger security checkpoint and a terminal parking garage. Construction on the checkpoint is expected to begin in the second quarter of 2017, while the parking garage project is slated for a late summer start.
A spokesman for the airport says Emanuel’s ordinance still must be approved by the city council’s committee on aviation. A date has not been set for that vote. If approved, it would then go to the full city council for final approval.
