STRATEGIC PRIORITY: Transportation & Infrastructure
AGENDA DATE: May 8, 2024
COUNCIL DISTRICT(S): 6
DEPARTMENT: Department of Aviation
EXECUTIVE: Kimberly Bizor Tolbert
______________________________________________________________________
SUBJECT
Title
Authorize a Fourth Amendment to the concession contract with The Grove, Inc. for food and beverage concessions services at Dallas Love field Airport to (1) extend the term of the contract by an additional seven-years; and (2) increase the current street plus 10 percent pricing to 17 percent for the quick-serve restaurants covered by the contract (Moe’s Southwest Grill and Manchu Wok) - Estimated Revenue: Aviation Fund $1,401,800.00
Body
BACKGROUND
On March 7, 2012, the City Council authorized a concession contract with The Grove, Inc. for food and beverage concession services for the construction, management, and operation of two food and beverage concessions, Moe’s Southwest Grill (C2181) and Manchu Wok (C2186) by Resolution No. 12-0706. The contract’s primary term began November 1, 2014.
Based on the concessionaire’s excellent operation through the primary term but especially during the COVID-19 pandemic when airline traffic was significantly reduced, with drastic staffing reductions and sales lost, the concessionaire continued operations to service the passengers and airport employees in a very trying climate. Post-COVID recovery progresses but at a significantly higher cost. Wages, hiring costs, merchandise and food costs have all increased, along with the delivery costs and all aspects of the operations at the airport have increased the costs of those operations. As enplanements continue to rise, the food and beverage outlet’s must be improved. To this end, The Grove, Inc. projects to spend $1,000,000.00 on capital improvements and rebranding of one unit and remodel of the other unit. The Department of Aviation seeks City Council approval to amend the contract with The Grove, Inc. to extend the term by an additional seven-years and increase the current street plus 10 percent pricing to 17 percent for Moe’s Southwest Grill, and Manchu Wok both of which are quick-serve restaurants. ……
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On March 7, 2012, the City Council authorized the City Manager to enter into a Food & Beverage Concession Contract with The Grove, Inc. for the operation of a Moe’s Southwest Grill and a Manchu Wok at the Airport (“Contract”) by Resolution No. 12-0706.
On June 3, 2014, the City Council authorized the First Supplemental Agreement to the Contract with The Grove, Inc. to allow for the sale of alcoholic beverages by Resolution No. 14-5970.
On August 12, 2015, the City Council authorized the Second Supplemental Amendment to the Contract with Concessionaire to address certain street pricing and rate of pay issues by Resolution No. 15-1335.
On September 22, 2021, the City Council authorized the Third Supplemental Agreement that exercises both of its one-year renewal options with The Grove, Inc., and the term of the Contract is further extended for two additional years commencing on the expiration of the Renewal Term of the Contract unless terminated sooner pursuant to the Contract by Resolution No. 21-1513.
FISCAL INFORMATION
Estimated Revenue: Aviation Fund $1,401,800.00
OWNER
The Grove, Inc.
Nina Madonia, Chief Executive Officer