HomeMy WebLinkAboutFIN-2022-412 - P21-146 Strategic Lease Opportunity - The Victoria Park Boathouse
Financial Services Department www.kitchener.ca
REPORT TO: Committee of the Whole
DATE OF MEETING: August 22, 2022
SUBMITTED BY: Ryan Scott, Manager, Procurement, 519-741-2200 ext. 7214
PREPARED BY: Ryan Scott, Manager, Procurement, 519-741-2200 ext. 7214
Brian Bennett, Manager, Business Development, 519-741-2200 ext. 7230
WARD(S) INVOLVED: Ward 9
DATE OF REPORT: August 2, 2022
REPORT NO.: FIN-2022-412
SUBJECT: P21-146 Strategic Lease Opportunity - The Victoria Park Boathouse
RECOMMENDATION:
This report is for information only.
REPORT HIGHLIGHTS:
The purpose of this report is to acknowledge the award of the successful proponent as per
Purchasing By-law 2017-106;
The reason this report is coming forward is future Council approval will be required to enter
into a lease agreement;
There were two (2) solicitations received for this procurement;
This report supports A Vibrant Economy.
BACKGROUND:
The Boathouse has been a key for decades.
In November 2019, the previous operator discontinued operating the Boathouse,
intention to issue a new Request for Proposal (RFP) to establish a new operator. This process
was delayed as a result of COVID-19 and uncertainty in the food and beverage sector with
mandated Provincial lockdowns.
An RFP was issued in November of 2021, closing in January 2022. The intent of the RFP
process was to receive responses from experienced and qualified operators of a high-quality
food service business and/or live music and entertainment venue operators, conduct a process
to identify the highest rated proponent, and then enter into a partnership through a lease
agreement.
The highest rated proponent has been identified, and subject to further approvals, a future lease
agreement may be executed to enable their vision for the space to proceed.
*** This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
REPORT:
Proposals were advertised publicly on the City of Kitchener website. Documents were
downloaded by nine (9) interested parties and by the closing date of Monday January 10, 2022,
two (2) proposals had been received.
A listing of the responding parties follows for your reference:
Walkinshaw Holdings Inc. Kitchener ON *
Cultura Café Kitchener ON *
*Shortlisted proponents
The proposal submissions were reviewed and rated by the selection committee B. Bennett,
Manager Business Development, C. Bluhm, Executive Director of Economic Development, K.
Kugler, Director of Sport, J. Edmondson, Manager of Facilities Management and B. Egan, Film,
Music & Interactive Media Officer.
The committee evaluated submissions and a shortlist of two (2) candidates* were selected to
provide presentations.
Proponents had to satisfy minimum requirements including:
Combined 5 years food service and/or entertainment experience
Minimum $300,000 working capital and 3 years pro forma financial statements
Minimum proposed lease rate of $18/sq ft
The proposal submissions were rated on the following criteria:
Statement of Interest and Community Benefit
Proposed Use and Operations
Business Team Experience and Qualifications
Term of Lease and Base Lease Rate
Estimated Proponent Improvements Costs
Financial Capability
The committee recommends awarding the project to Walkinshaw Holdings Inc., Kitchener,
Ontario, who met all the mandatory requirements and are the highest rated proponent.
Proponents Vision
The proposal from Walkinshaw Holdings Inc. envisions transforming the Boathouse into an
iconic venue for live music, food, and indoor and outdoor entertainment. The proposal places a
focus on social responsibility, with paid local live music a minimum of two days a week, and
locally sourced food and drink. Walkinshaw Holdings Inc would also establish a local arts fund
and form a Community Advisory Committee to ensure that Boathouse programming is inclusive
and diverse.
Proposed Improvements
There are several proposed improvements which will require additional approvals and/or review
by external agencies. As such, execution of a lease would be contingent upon Walkinshaw
Holdings Inc. successfully obtaining all required permits and approvals. Walkinshaw Holdings
Inc. would be responsible for the capital costs associated with these capital improvements to the
facility.
Terms of the Lease Agreement
Staff recommend entering into a lease agreement with Walkinshaw Holdings Inc. for a 10-year
term with an option to renew for an additional term of 5 years. The lease rate in year 1 would
be $20/sq ft increasing annually to $21.65/sq ft by year 5. After year 5, the lease rate would
increase annually at the rate of inflation.
Conclusion
In accordance with Purchasing Bylaw 2017-106, Walkinshaw Holdings Inc. are the successful
proponent of Proposal P21-146, subject to Walkinshaw Holdings Inc. obtaining all required
permits and approvals, and the successful execution of a lease agreement which will be subject
to future Council approval.
STRATEGIC PLAN ALIGNMENT:
This report supports A Vibrant Economy.
FINANCIAL IMPLICATIONS:
This is a revenue generating opportunity that will provide community benefit. A portion of the
rent revenues are transferred to the Economic Development Reserve annually to repay the
capital investment made to the building in 2014.
COMMUNITY ENGAGEMENT:
INFORM da in advance of the
council / committee meeting.
PREVIOUS REPORTS/AUTHORITIES:
There are no previous reports/authorities related to this matter.
APPROVED BY: Jonathan Lautenbach, Chief Financial Officer, Financial Services
Department