A consortium of some of the city’s best-known restaurateurs landed a 10-year contract Monday to provide food service and catering at McCormick Place, despite concerns by some board members about a low level of minority participation in their bid.
The Metropolitan Pier and Exposition Authority, or McPier, which runs the convention center, awarded the $300 million contract to Chicago Restaurant Partners, a joint venture between Larry Levy of Levy Restaurants and Phil Stefani of Phil Stefani Signature Restaurants Co. A third partner, Airport Restaurant Management Inc., is a minority-owned company with a 10 percent stake in the partnership. Levy and Stefani each have a 45 percent share.
Three board members voted no, and three abstained, including Chairman Ted Tetzlaff, but the Levy-Stefani bid garnered seven votes among the board’s 13 members, enough to pass. Levy currently has the food service contract at McCormick Place, and there have been complaints from some show organizers about the quality and variety of the offerings.
Board member Michael Scott said he was not happy with the outcome but not particularly surprised.
“The issue of participation is one thing but ownership is another,” said Scott, president of Michael Scott & Associates, a real estate development firm. “We always settle for participation.”
Scott, who is African-American, said he believes the 10 percent stake held by the minority partner in the Levy-Stefani deal should have been higher.
His concerns were echoed by board member Alisa Starks, who took the defeat philosophically. “The vote is the vote. That’s the board,” she said.
Tetzlaff said he was pleased with the board’s decision, which followed the recommendation of a consultant and special committee who evaluated the bidders. He attributed the concerns of some board members about affirmative action goals to their recent tenure on the board.
“We had some members who had some catching up to do. That happens when you change horses in the middle of a race,” he said.
Tetzlaff said he is very concerned about the issue of minority participation. “We can always do better,” he said. But he said affirmative action is “a top priority of our staff and I know it’s of special importance to our new CEO.”
The new contract goes into effect Sept. 1 and is expected to generate $300 million in gross sales over a 10-year period. Last year the food service contract generated $24.6 million in gross sales, and McPier received a $5.6 million cut of that. Its portion is expected to rise to $6.2 million in fiscal 2008. Under a formula in the new contract, McPier could receive $7.2 million in annual revenue.
The losing bidders included Aramark Sports and Entertainment Services Inc., a giant foodservice company that held the McCormick Place contract years ago, and Lake Shore Hospitality Group, a joint venture of Buona Cos. and Delaware North Cos.
Dissenting board members complained that the Lake Shore bid would have generated $1 million more for McPier.
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schandler@tribune.com
