Existing retailers at the Owen Roberts International Airport will be given preferential treatment in the bid process for space in the newly renovated terminal after officials and tenants reached a compromise.
Current operators who are in “good standing” with the Cayman Islands Airports Authority will receive additional points in the selection process for space inside the expanded building. However, they will still have to compete with other interested retailers in an open bid process.
Robert Hamaty, chairman of the tenants association representing 12 retailers that have outlets in the airport, had called for the businesses to be automatically “grandfathered” in to the new terminal.
The Airports Authority instead plans to hold an open tender for the 17 spaces, with the bid process conferring an advantage on existing airport retailers and Caymanian-owned businesses.
Mr. Hamaty said he had met with Tourism Minister Moses Kirkconnell and Chief Officer Stran Bodden and was happy that the concerns raised appeared to have been taken on board.
“We are definitely a lot happier that at least we have an advantage in the bid process. At least the fact that we are approved tenants with a track record of running successful businesses at the airport will count for something. It is not just highest bidder wins,” Mr. Hamaty said.
The Airports Authority indicated in a press release Friday that the bid process would begin shortly, though it did not specify a date. Prospective retailers will be required to pay rent based on a percentage of their annual revenue, with a guaranteed minimum payment.
Mr. Hamaty said the funding model is a new concept for retailers used to paying a flat monthly fee. He said the formula means the airport could not lose, but he said retailers who know their business should still be able to turn a profit.
He cautioned that tenants would have to be careful not to overstate their likely revenue in a bid to be granted space at the new airport.
“You have to know your business and not overbid because you could go in there and lose your shirt,” he said.
Albert Anderson, CEO of the Cayman Islands Airports Authority, said in the press release that the aim is to select the highest quality shopping and dining concepts to meet the passengers’ needs.
“We want to ensure we have a fair and open process for everyone interested in submitting a proposal, as we strive towards our ultimate vision of giving our passengers the best experience when travelling through the Owen Roberts International Airport,” he said.
Businesses will be able to bid on as many spaces as they like, not as a package but as separate bids for each space. However, they will be limited to winning no more than three spaces in total and no more than one in any one category, including food and beverage, retail and duty free, the authority said.
Any business with a license to trade in the Cayman Islands will be eligible to submit a tender. Eligible businesses that are 60 percent or more Caymanian owned will receive points in the tender evaluation process.
The airport terminal expansion and renovation project is expected to be completed in 2018.