March 7, 2012 WHEREAS, the City owns and operates a municipal airport, Dallas Love Field; and,
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1 WHEREAS, the City owns and operates a municipal airport, Dallas Love Field; and, WHEREAS, the Love Field Modernization Program (LFMP) is currently underway and will result in a new terminal building and a twenty gate concourse, scheduled to be completed by October 2014; and, WHEREAS, upon completion of the LFMP, a larger concession program that improves customer service will be offered; and, WHEREAS, the City requested proposals from qualified concessions operators in accordance with the direction provided by the City Council at its August 18, 2010 briefing; and, WHEREAS, the contracts before the City Council for consideration today are intended to improve the concessions services offered at Love Field; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DALLAS: Section 1. That upon approval as to form by the City Attorney, the City Manager is hereby authorized to enter into contracts with Host International, Inc. estimated annual revenue of $617,000, HG-Multiplex-Regali Dallas JV estimated annual revenue of $2,008,726 and Hudson Retail Dallas JV estimated annual revenue of $846,789 for the operation of retail concessions at Dallas Love Field Airport, for a total estimated annual revenue amount of $3,472,515. The term of each contract will be seven years with two one year renewal options. Section 2. That the required concessions concepts, rents, length of contract terms, and minimum initial capital investments to be contained in each contract shall conform to the following: CONTRACT I Host International, Inc. Concepts: D Magazine News, Texas Monthly News, (Newsstand/Children/Educational) and Creative Kidstuff First Year MAG: $617,000
2 Percentage Rents: 12% of annual gross revenues on all specialty merchandise sales (Creative Kidstuff) 20% of annual gross revenues from all news location sales Capital Investment: $969,205 Estimated total revenue: $4,319,000 CONTRACT 2 HG-Multiplex-Regali Dallas JV Contract 2, Package A: Concepts: Hudson NewslHudson Booksellers, Fair Park TX, Billy Bob s Texas (Newsstand/Books, Museum Shop, Texas Music Venue) First Year MAG: $1,106,795 Percentage Rents: 18% of annual gross revenues on sales up to $5.OM for news/convenience merchandise 22% of annual gross revenues on sales over $5.OM for news/convenience merchandise 15% of annual gross revenues from the sale of specialty merchandise Capital Investment: $1,366,487 Estimated total revenue: $7,747,565 Contract 2, Package B Concepts: West End News, Desigual, Bliss and Soybu (Newsstand, Lifestyle, Health & Beauty) First Year MAG: $819,687
3 Percentage Rents: Capital Investment: $1,186,081 Estimated total revenue: $5,737,809 Contract 2, Package C Concept: Fire CZ (Fashion Kiosk) First Year MAG: $82,244 18% of annual gross revenues on sales up to $3.5M for news/convenience merchandise 22% of annual gross revenues on sales over $3.5M for news/convenience merchandise 15% of annual gross revenues from the sale of specialty merchandise from all sales Capital Investment: $203,673 Estimated total revenue: $575,708 CONTRACT 3 Hudson Retail Dallas, JV Contract 3, Package A: Concepts: CNN Newsstand Dallas, Mallasadi Men s Boutique (Newsstand, Men s Apparel/Accessories) First Year MAG: $ Percentage Rents: 20% of annual gross revenues for news/convenience merchandise 11 % of annual gross revenues for specialty merchandise
4 Section 2. (Continued> Capital Investment: $814,338 Estimated total revenue: $2,394,700 Contract 3, Package B Concept: Tech on the Go (Electronics) First Year MAG: $158,162 Capital Investment: $375,188 Estimated total revenue: $1,107,134 Contract 3, Package C Concept: Spectacles (Fashion Kiosk) First Year MAG: $111,978 Capital Investment: $205,680 Estimated total revenue: $783,846 Contract 3, Package D Concept: Travel + Leisure Travel Store (Leather Goods) First Year MAG: $116,249
5 Capital Investment: $349,065 Estimated total revenue: $813,743 Contract 3, Package E Concept: Cowboy Shop - Famous Texas Boots (Western Theme Apparel) First Year MAG: $118,300 Percentage Rents: 14% of annual gross revenues Capital Investment: $285,660 Estimated total revenue: $828,100 Section 3 That the City Controller is authorized to deposit all revenues received from the concessionaires as follows: Fund: 0130, Dept: AVI, Unit: 7725, Rev Section 4 That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City of Dallas, and it is accordingly so resolved. APPROVED BY CITY COUNCIL MAR IngCItcretaR
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