Global Spectrum Contract
Agenda • Current Contract Structure • Kitchen Upgrades • Audio Visual Upgrades • IT Interface • ADA Compliance • Financial Proforma (First 3 Years) • Expected Attendance
Global Spectrum Contract as proposed Fixed Management Fee per Month $8,000 Yearly Adjustment Fee escalates by the percent CPI increases year over year Incentive Fee Financial Fee 15% of the increase over the Revenue Benchmark Benchmark Average annual revenue minus annual average revenue for food/beverage for 3 years plus $300,000 Food and Beverage Fee 4% of gross food/beverage revenue Qualitative Fee Capped at 20% of management fee Transition Cost Reimbursement Reimbursement per Transition Budget Reimburse Global for their out of pocket expenses City Use of Facility Paper credit for difference between published rate and what the City pays Operating Budget Proforma for the first three(3) years Liability Global has no liability if operating budget is not met. There are notifications Initial funding for Operations City to deposit first months operating budget into Operations Account Each Months Operations Budget City makes up the difference Capital Improvements Global to deposit $150,000 which is a loan Kitchen, Audio/visual and IT upgrades needed agreed upon prior to Effective Date and implemented Improvements before Turnover during the first 90 days of the contract. Operating Cash Reserve Reserve to be established equal to three(3) months of operating expense.
Kitchen Short Term 1 Renovate first floor kitchen to become support kitchen for concessions during events and in-house catering kitchen 1. Remove and retire all existing equipment, hood, etc. With the exception of the walk-in cooler and freezer. 2. Install new NSF approved epoxy paint on floor throughout. 3. Install new NSF and HD approved wall finish throughout. 4. Install new mop sink, hand sink, 3-compartment sink, door-type dishwasher with soiled and clean table, and shelving in the dishwasher area. 5. Install new hand sinks, worktables, worktables with sinks, prep area, and cooking line with hood in main area with cooking line along long back wall allowing for future expansion. 6. Install new equipment: Fryer bank with dump station, griddle, 6-burner range with convection oven below and salamander above, medium sized combo oven, char broiler, etc…
Kitchen Short Term 1 (continued) Renovate first floor kitchen to become support kitchen for concessions during events and in-house catering kitchen 7. Install new expedite line with refrigerated storage, pick-up shelf with heat strip, and tray table with dish storage. 8. Install additional mobile box connection locations for hot & cold boxes. 9. Install new gaskets on walk-in doors 10. Repair condensate drain on walk-in freezer. 11. Install new mobile storage shelving and dunnage racks in walk-ins and storage areas. TOTAL: $140,000
Kitchen Short Term 2 Make minor revisions to second floor catering staging area to accommodate professional catering needs, drink service, Health Department requirements 1. Remove and retire all existing equipment and plumbing fixtures. 2. Repair/improve floor and wall coverings as required by HD 3. Install additional electrical for hot and cold mobile catering boxes (120V and 240V) (10min) 4. Install new hand sinks as required. 5. Install new 3-comp bar-sized sink unit with deli-option for height, etc… 6. Install new mobile SS worktables with under shelves for catering staging. 7. Install new 2-door commercial refrigerator. 8. Install new mobile wire shelving unit for catering storage. 9. Install new drink station at vestibule between functions rooms to accommodate drink service including: coffee, tea, water, soda fountain with ice station. TOTAL: $20,000
Kitchen Short Term 3 Make minor revisions to concession areas to improve appearance, product visibility, expand menu with additional equipment, ADA compliance, increase Points of Sale, reduce queue line and improve sales. 1. Install new front counters to comply with ADA. 2. Enclose open CMU block areas on front counter wall. 3. Install new NSF approved epoxy paint on floor throughout. 4. Install new NSF and HD approved wall finish throughout. 5. Install new back wall (7' height) behind new back counter 6. Install new SS counters on casters for back counter equipment and displays. 7. Move Bag-in-the-box and ice makers to back room areas 8. Remove all wall cabinetry from concession areas 9. Digital menu boards above new 3/4 height walls.
Kitchen Short Term 3 (continued) Make minor revisions to concession areas to improve appearance, product visibility, expand menu with additional equipment, ADA compliance, increase Points of Sale, reduce queue line and improve sales. 7. Prep front counter for 4 POS stations with 2 soda towers 8. Provide Draft beer cooler on casters (3-4 keg) for each stand that can be incorporated for appropriate events. 9. Provide greaseless ventless 'fryers' to allow for additional offerings such as french fries, chicken fingers, etc… 10. Provide ventless pizza conveyor oven to allow for sale of fresh pizza. 11. Install hand sinks and bar-sized 3-comp per HD requirements. 12. Provide wire shelving storage units with casters and dunnage racks as required for storage areas. TOTAL: $80,000
Kitchen Short Term 4 Include an F&B Cart plan to supplement the FS options to guests based upon each events 1. Provide Draft Beer coolers on casters (3-4 keg) for beer carts that can in incorporated for appropriate events. 2. Provide additional Food and Beverage carts for concourse after a plan has been created based on analysis. Assuming at least 8 new carts plus vendor supplied carts. TOTAL: $90,000
Kitchen Long Term 5 Add to Commissary Kitchen to allow for total in-house catering for all events 1. Install additional hood for extension of cooking line to accommodate additional cooking equipment. 2. Install double-stack convection ovens, full-sized roll-in combo ovens, tilt-skillet, etc….under new hood. 3. Install roll-in blast chiller for pre-cooked and pre-plated banquet items. 4. Install secondary walk-in cooler and freezers. 5. Install additional prep, pick-up, and assembly tables. 6. Install additional reach-in and under counter refrigerators as required by layoff. 7. Include small wares budget with buffet items, chafing etc… TOTAL: $200,000
Audio Visual Upgrades AV Upgrades – Muskogee Civic Center 1. Diagram, label and create operating instructions for all pre-existing AV equipment 2. New amps as noted in AVL System Design recommendations 3. Add reference monitors to mix/control room location 4. New mics – 4 receivers, 4 handheld wireless, 4 body packs, 2 lavs and 2 headset mics 5. Patch level bay at stage level and 16x16 mixer router minimum in sound booth / control room 6. QSC touchmix series mixer board 16 channel with wireless phone/tablet mix capabilities 7. Networked pc in control room 8. Short throw projector in front of existing projection screen or an RP projector behind an PR screen 9. Kramer VP731 switcher scaler in control/sound room 10. System testing, system maintenance and preventative maintenance agreement with mutually agreed upon AV company Cost of AV Upgrades and improvements estimated at $40,000
IT Interface Network Drops 24 $150.00 $3,600.00 IP115 Phones 3 $130.00 $390.00 IP230 Phones 4 $230.00 $920.00 Cisco WS-C2960-24PC-L 1 $1,385.00 $1,385.00 Dell OptiPlex 7020 SFF Computer 2 $756 $1,512 Dell E2214H 22” Wide Monitor 6 $141 $846 Dell E2314H 23” Wide Monitor 6 $156 $936 Total $9,589.00
ADA Compliance • Currently ADA Compliant • Suggested changes to concession areas per Kitchen short term suggestions
Financial Proforma (First 3 Years) Gross Revenue $492,342 $550,934 $585,693 Gross Profit/Revenue 255019 $301,745 $324,044 Total Operating Expenses $596,999 $611,445 $626,240 EBITDA (Earnings) ($341,980) ($309,700) ($302,196) Net Operating Income ($356,980) ($324,700) ($317,196) Fee based on revenue 14999 $23,787 $29,001 Fee based on concessions $10,561 $11,089 $11,644 Qualitative Fee $19,200 $19,584 $19,976 Debt Funding (From Global) $150,000 Transition Cost (For Global) $23,825 CapEx - Kitchen $330,000 CapEx - Audio/Visual $40,000 CapEx - IT $9,589 Net Cash ($655,154) ($229,910) ($224,956) Cash Reserve Requirement $149,250 $152,861 $156,560 Reqd. City Contribution to have a Reserve of 3 months of $804,404 $382,771 $381,516 Operating Costs $1,568,691 Total City Contribution for 3 years
Expected Attendance Year 1: 77,725 Year 2: 87,250 Year 3: 93,600
Recommendation Authorize the City Manager to negotiate and execute the contract
Don Root Retail Business Enterprise Director 230 W. Okmulgee Avenue Contact Muskogee, OK 74403 (918) 684-6321 (v) http://www.cityofmuskogee.com
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