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Division of mall operator Westfield wins LAX concessions contract

January 23, 2012 |  2:59 pm

 

Aircraft roll past construction at LAX, where a division of mall operator Westfield has won a concession contract.

Marking a change in the way concession contracts have been awarded, airport officials Monday selected a division of a shopping mall operator to perform the next overhaul of dining and retail concessions at busy Los Angeles International Airport.

The Los Angeles Board of Airport Commissioners awarded a major contract to Westfield Concession Management, a unit of the Westfield Group, the developer and operator of 55 shopping malls across the country, including in Culver City and Century City. Westfield Concession oversees retail and dining establishments at nine large airports.

The company will develop and manage a variety of restaurants, beverage stands and retail stores in Terminal 2, the Tom Bradley International Terminal, which is undergoing a $1.5-billion renovation, and the jet-age-style Theme Building, home to the Encounter restaurant.

Officials have not revealed which restaurateurs and vendors are being considered.

The 17-year agreement with Westfield is expected to generate $331.1 million in revenue, of which Los Angeles World Airports will receive a minimum of almost $17.7 million the first year. The amount will be adjusted each year thereafter, based on inflation and passenger volume.

Westfield and its concessionaires are required to invest at least $81.9 million for initial improvements and $16.4 million more midway through the life of the agreement.

The selection of a shopping mall operator represents a change in the way concessions contracts have been awarded at the nation’s third-busiest airport, which has historically received low marks for its concessions.

In the past, airport officials have relied on companies that specialize in the development and selection of restaurants, beverage outlets and retail shops at commercial airports. They said Westfield should provide a greater variety of vendors and can better develop the available space in the terminals.

Westfield was picked using a competitive bid process that went much more smoothly than last year’s selection of concessionaires for terminals 4, 5, 7 and 8. The awarding of those contracts by a City Council committee was marked by bid protests, intense lobbying and allegations of conflicts of interest.

Airport officials are planning to award another concessions management contract for terminals 1, 3 and 6 later this year.

RELATED:

Politics hampers efforts to update concessions

L.A. Council approves airport concessions contracts

Potential conflicts disqualify airport panel from voting on contracts

-- Dan Weikel

Photo: Aircraft roll past the Bradley West project at LAX, where cranes, cement mixers and workers are busy building a new terminal. Credit: Mark Boster / Los Angeles Times

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