Airport Dining and Retail Tenant Build-Out
Analysis
Lance Lyttle, Aviation Managing Director
Dawn Hunter, Acting Aviation Chief Operating Officer
Khalia Moore, Sr. Manager Airport Dining and Retail
Item No.: 9a_supp
Meeting Date: March 8, 2022
Background
• Motion 2020-19
• Airport Dining and Retail (ADR) Tenants collective met with ADR staff to discuss the
cost of design and construction at the SEA.
• The complaints included several areas of the process and ultimately met with
Aviation Managing Director and Commissioners to find resolution to the issue.
• Executive Director Metruck asked ADR Staff to engage with the LEAN Process
Improvement Team to understand the issue and find long term solution the
problem.
2
Tenant Build-Out Analysis
• Voice of the Tenant Meeting
• Overall Areas of Concern
– Design Review Process
– Port Design Standards
– Building and Fire Code Review
– Permitting
3
Airport Dining and Retail Construction New Best
Practices
• Begin a new ADR Master Planning Effort
• Evaluate current Port standards & create ADR specific standards
• Re-evaluate base building conditions based on new ADR Master Planning Efforts
• Before design starts, Port Demo of the space (cold-shell)
• After demo, verify as-builts conditions with new tenants
• Port addressed base building conditions
• Port standards impacting Aviation Commercial Management business partners will be
discussed and approved with Aviation Commercial Management/ADR team prior to
implementation to understand and analyze business and cost impacts to the
tenants/program
• SME’s ( Subject Matter Experts) are at the table when key planning decisions are made
4
Analyzing Tenant Impacts
• Took a sample of the Central Terminal which has cross-section of
small and large businesses with a variety of categories such as:
Food and Beverage, Retail, Convenience Retail and with a tenant
mix over all Affected Tenants Lease Groups (which LG2 through
LG4A)
• Comparing the proforma for initial capital investment provided
during their proposals to the certified construction costs at the
completion of their projects, actual sales revenue generated and
current term without the COVID relief.
5
Analyzing Tenants Impacts
6
2 Small Service 378,288.00$ 895,949.96$ (517,661.96)$ 137%
2 Smalll Food and Beverage 900,000.00$ 1,815,888.00$ (915,888.00)$ 102%
3 Small Food and Beverage 725,000.00$ 1,166,408.00$ (441,408.00)$ 61%
4 Joint Venture Food and Beverage 1,257,049.36$ 2,734,983.16$ (1,477,933.80)$ 118%
Proposed
Improvement Amount
Actual CapEx
Improvement
Amount
Difference
Percentage
Difference
Lease
Group
Small/Large
WMBE/ACDBE
Category
Tenant Analysis Recommendations
• After reviewing the cost variance of the sample tenants, the
Port is recommending that an additional three (3) years term
be provided to the Affected Tenants.
• Staff analysis identified that this is sufficient time to receive the
return on the additional investment due to the Port design and
construction process.
• Took a sample and looked at the additional costs and the number
of years to amortize their loan which came out to approximately
2.5 years which was rounded up to three years
7
Questions
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