A partnership that includes SSP America and Hudson Group is in negotiations with Chicago city officials for a contract to lease, develop, manage and operate the concessions program at Midway (MDW), several sources told ARN.
Chicago Department of Aviation Commissioner Ginger Evans confirmed in an interview last week that the city had “started negotiations with a potential vendor” but declined to name the group involved and said a contract has not yet been formally awarded. She declined to comment on details of the negotiations.
“Our goal is very straightforward: to guarantee the best possible outcome for future enhancements for the passenger experience at Midway,” Evans said.
Representatives from both SSP America and Hudson Group declined to comment.
Mayor Rahm Emanuel and the Chicago City Council must approve the negotiated deal. One source told ARN that it is “far from a done deal” given the intensely political nature of the RFP process within the CDA and the city.
Evans said she expects the deal to go to the city council for approval in June, although she warned that factors could derail current negotiations and push the timeframe to later in the summer.
The MDW modernization program is expected to cost $248 million and will encompass not only concessions but also a parking garage expansion and revamping of security checkpoints.
Within concessions, the contract includes food and beverage, news and convenience, automated vending, specialty retail and duty free. The program includes more than 51,300 square feet of existing concessions space, as well as an additional 18,000 square feet of expansion concessions space. All concessions areas, stores and restaurants are to be renovated, and the airport requested that shopping, dining, lounge facilities, spa services and medical services to be added.
The terms of the RFP require a $10 million minimum initial capital investment in CDA-required projects. The chosen single entity will be required to sublease at least 40 percent of the program and have at least 37 percent Airport Concessions Disadvantaged Business Enterprise participation. The length of the agreement is 15 years.
The SSP America/Hudson Group partnership also includes global airport investment and management firm Vantage Airport Group. Vantage operates several airports in Canada, as well as in Nassau, Montego Bay and Cyprus. Vantage is also part of a team selected as the preferred proposer for the terminal replacement project at LaGuardia (LGA).
According to Crain’s Chicago Business, the partners in negotiations for the Midway contract also include a venture controlled by Geneva Mansaw, a woman related to the Rand family, which runs Mac One, the current food and beverage concessionaire at Midway; and a venture controlled by Martin Cabrera and Robert Aguilar, executives at Chicago investment firm Cabrera Capital Markets.
