Midway concession makeover cleared for take off
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After nearly a year of behind-the-scenes maneuvering that spawned a demand for a federal investigation, Mayor Rahm Emanuel is finally moving ahead with his makeover of Midway Airport concessions.
The mayor plans to introduce an ordinance Wednesday empowering the city to enter into a 15-year agreement with a clout-heavy group known as Midway Partnership LLC.
Midway Partnership is a joint venture of SSP America Inc., Vantage Airport Group and Hudson Retail LLC. The politically connected Rand family that has operated Midway concessions for years is part of the deal despite questions about the company’s eligibility as a minority subcontractor.
The concession makeover is pivotal to Emanuel’s plan to confront Midway’s biggest weaknesses and passenger annoyances: parking, security and concessions.
The $248 million Midway overhaul will give the Southwest Side airport an additional 1,400 premium parking spaces, a Taste of Chicago-style concession makeover with more space, and 27 security lanes, instead of 17, to unclog a notorious passenger bottleneck.
The dramatic increase in security checkpoints would be made possible by widening a pedestrian bridge over Cicero Avenue from 60 feet to 300 feet. That will create an 80,000-square-foot “security hall” with 20,000 square feet of additional concession space.
Existing Midway concessions are also in line for a dramatic upgrade to improve both the array of passenger choices and the technology used to deliver food and retail offerings. Spa services, lounge facilities, fine dining and medical services will be added.
All of the concessions will be turned over to Midway Partnership. The agreement calls for the joint venture to invest $75 million to renovate and expand Midway concessions from 26,000 square feet of space to nearly 70,000.
The Chicago Sun-Times reported earlier this month that Emanuel still had not closed on the Midway concession deal more than a year after a stampede of clout players put forward proposals.
The newspaper reported that, after evaluating the proposals for less than six weeks, city officials picked a “tentative” winner on March 3, 2016, and began negotiations nine days later.
Those talks continued into December, when Aviation Commissioner Ginger Evans shared a document — marked as confidential — with aldermen that said it was “to be determined” when the new deal would be introduced to the City Council.
At the time, Evans told aldermen the deal had been delayed by complaints against a member of the preferred bid team.
In June, a labor union that represents airport concession workers sent a letter to the U.S. Department of Transportation. A lawyer for UNITE HERE Local 1 requested an investigation into the Rand family’s involvement.
Timothy Rand’s Midway Airport Concessionaires reported 2014 revenues of more than $30 million, making it the biggest beneficiary of the status quo at the airport. The deal expired the year before last, but he’s continued to hold onto the business as the bid process for the new deal dragged on.
The city had let Rand’s company continue to keep its Midway contract even though his net worth far exceeded the federal limit for minority firms that enjoy preferential status in winning business at the nation’s airports.
Now, a company led by Geneva Mansaw — the widow of Rand’s late father — is part of the winning team.
In the letter to the federal Department of Transportation’s inspector general, a lawyer for UNITE HERE presented city documents showing close ties between Rand’s Midway Airport Concessionaires and Mansaw’s NorthAmerican Concessions Inc.
“We request that your office investigate whether NorthAmerican Concessions is controlled by its president and whether she is an economically disadvantaged individual sufficient to qualify” her company for preferential treatment in the bid process, wrote the lawyer, who did not return calls seeking comment.
Asked then about the union complaint to federal authorities, Rand said, “That has been resolved.”
As for the new Midway bid, Rand said, “Everything is pending.”
Aviation Department spokesman Owen Kilmer emphasized that the Rand Brothers have “no financial interest” in the Midway concession deal.
“Their mother and daughter are the people involved,” Kilmer wrote in an email to the Sun-Times.
The Sun-Times has previously reported that Mansaw’s NorthAmerican Concessionaires is part of the clout-heavy bid team led by Virginia-based SSP America and the Hudson Group of New Jersey. The team also includes longtime Emanuel allies Becky Carroll and Martin Cabrera and features such brands as Calvin Klein, Billy Goat Tavern, Intelligentsia Coffee and Cooper’s Hawk, according to bid documents.
City records show SSP America has paid $360,000 in lobbying fees to John Dunn, a former top aide to Mayor Richard M. Daley, and more than $200,000 to other City Hall lobbyists, including John Borovicka — who worked for Emanuel when Emanuel was a congressman.
In a press release announcing the deal, Emanuel noted that the agreement would double Midway’s concession workforce to 1,400 employees, create 250 construction jobs and bolster the city’s sales tax revenues by $10 million.
“This agreement is an investment in Chicago. Creating jobs, highlighting local businesses and improving the airport’s overall passenger experience,” the mayor said in the release. “It also marks an important step forward in our overall plan to modernize Midway and increase the airport’s competitive viability for the future.”