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Notice Details

Title: St David’s Hall
OCID: ocds-kuma6s-132101
Published by: Cardiff Council
Authority ID: AA0422
Publication Date: 05/06/2023
Deadline Date:
Deadline Time:
Notice Type: 15 Voluntary ex ante Transparency (VEAT) Notice (Concessions)
Has Documents: No
Has SPD: No
Abstract: This notice relates to a proposed arrangement between the Cardiff Council (“Council”) and Academy Music Group (“AMG”) in respect of St David’s Hall (“Venue”) in Cardiff city centre.
The proposed arrangement will involve the grant of a 45 year lease of the Venue at a peppercorn rent to AMG. Under the lease AMG will be obliged to repair and maintain the Venue, ensure its long-term future and that it remains open for the benefit of the people and City of Cardiff. The Council may also receive a share of Venue profits over the lifetime of the lease. AMG, as tenant will operate the Venue as an independent commercial enterprise in accordance with the lease requirements. The lease will have positive obligations imposed on AMG to deliver a range of services in operating the Venue including continuing the classical programme as described in more detail below.
Continued below in II.2.4) Short description.
CPV: 92000000, 92312100, 92300000, 92312120, 92312130, 92312140, 45000000, 55120000, 55130000, 55520000, 55330000, 55400000, 55410000, 55500000, 70220000, 70332000, 70330000, 70332200, 79993000, 79993100, 90911200, 75241000, 79710000, 79950000, 79951000, 79952000, 79952100, 79953000, 79956000.

Voluntary ex ante transparency notice

Directive 2014/23/EU

Section I: Contracting authority/entity

I.1) Name and addresses

Cardiff Council

County Hall, Atlantic Wharf

Cardiff

CF10 4UW

UK

Telephone: +44 2920873732

E-mail: corporate.procurement@cardiff.gov.uk

NUTS: UKL22

Internet address(es)

Main address: https://www.cardiff.gov.uk

Address of the buyer profile: https://www.sell2wales.gov.wales/search/Search_AuthProfile.aspx?ID=AA0422

I.4) Type of the contracting authority

Regional or local authority

I.5) Main activity

General public services

Section II: Object

II.1) Scope of the procurement

II.1.1) Title

St David’s Hall

II.1.2) Main CPV code

92000000

 

II.1.3) Type of contract

Services

II.1.4) Short description

This notice relates to a proposed arrangement between the Cardiff Council (“Council”) and Academy Music Group (“AMG”) in respect of St David’s Hall (“Venue”) in Cardiff city centre.

The proposed arrangement will involve the grant of a 45 year lease of the Venue at a peppercorn rent to AMG. Under the lease AMG will be obliged to repair and maintain the Venue, ensure its long-term future and that it remains open for the benefit of the people and City of Cardiff. The Council may also receive a share of Venue profits over the lifetime of the lease. AMG, as tenant will operate the Venue as an independent commercial enterprise in accordance with the lease requirements. The lease will have positive obligations imposed on AMG to deliver a range of services in operating the Venue including continuing the classical programme as described in more detail below.

Continued below in II.2.4) Short description.

II.1.6) Information about lots

This contract is divided into lots: No

II.1.7) Total value of the procurement

Value excluding VAT: 45 000 000.00  GBP

II.2) Description

II.2.2) Additional CPV code(s)

92312100

92300000

92312120

92312130

92312140

45000000

55120000

55130000

55520000

55330000

55400000

55410000

55500000

70220000

70332000

70330000

70332200

79993000

79993100

90911200

75241000

79710000

79950000

79951000

79952000

79952100

79953000

79956000

II.2.3) Place of performance

NUTS code:

UKL22


Main site or place of performance:

St David’s Hall, Cardiff, CF10 1AH.

II.2.4) Description of the procurement

Continued from II.1.4)

The Council will also enter into a Business Sale Agreement (“BSA”) with AMG to enable service handover and continuity at the Venue. This will transfer the “book” of existing events and the assets of the business at the Venue to AMG for nil value. It will also transfer the benefit of relevant consents to operate the business. All current Venue staff are expected to TUPE transfer to AMG.

The lease obliges AMG to manage and repair (in a manner that AMG determines) a list of defects. The cost to bring the Venue back to its original condition is estimated at 38mGBP. AMG will be responsible for maintaining the condition of the building and would have flexibility to invest in and improve the Venue.

The lease requires (amongst other normal terms) AMG to keep the Venue open in a safe and operational condition in line with industry standards and as required by all statutory and licensing requirements.

The estimated value in II.1.7 and V.2.4 represents the Council’s assessment of the lower end of the potential net profit that could be achieved for a venue of this nature over a 45 year term. The potential higher end net profit over the 45 year term could be in the region of 67mGBP. These values are based on the Council’s projections of total revenues that may be achieved over the maximum 45 years and assumes a 5-10% net profit (which is a common range in this industry). The actual value of the opportunity (and potential revenues and profit turns) will depend on many commercial factors (including but not limited to) the performance and success of the tenant’s business and market conditions.

Continued below in VI.3) Additional Information.

II.2.11) Information about options

Options: No

II.2.13) Information about European Union funds

The procurement is related to a project and/or programme financed by European Union funds: No

Section IV: Procedure

IV.1) Description

IV.1.1) Type of procedure

Award of a contract without prior publication of a call for competition

Justification for selected award procedure:

The procurement falls outside the scope of application of the Directive

Explanation:

The Council has structured the arrangements as a grant of a lease which does not involve an acquisition activity governed by the Public Contracts Regulations 2015 (as amended) or Concession Contracts Regulations 2016.

The Council has obtained valuation advice in respect of the proposed disposal and will grant the lease for peppercorn rent. The market value of the rent acknowledges and takes into account the substantial building liability and remedial works that AMG will be required to take on as tenant of the Venue.

The lease does oblige AMG to address defects, repair and maintain the Venue, but these are incidental and ancillary to the lease arrangements because: (i) the estimated value of the works at 38mGBP is small compared to the estimate potential value of the operator opportunity over 45 years of the lease; (ii) the main purpose of the transaction is to transfer the Venue to an independent operator and not the securing of the works; and (iii) AMG has a broad discretion to determine the manner, timing and specification of the works as a tenant of the Venue. Furthermore, it is not practical for the works to be severable to be delivered by an alternative contractor given AMG’s occupation and operation of the Venue.

If AMG does not manage and repair the defects so that the Venue is safe and operational, the Council can terminate the lease or procure the delivery of those works at AMG's cost. AMG may voluntarily elect to carry out other works (including alteration upgrades, enhancements and other repairs and maintenance as may be needed) at the Venue in accordance with its own requirements.

The lease also requires AMG to keep the Venue open in a safe and operational condition in line with industry standards and as required by all statutory and licensing requirements. This is a standard commercial tenant requirement and does not amount to a services contract under the procurement rules.

The lease also requires AMG to maintain the classical music programme at the Venue and to provide the Services for those events and accommodate a community programme.

Continued in VI.4.3).

IV.1.8) Information about Government Procurement Agreement (GPA)

The procurement is covered by the Government Procurement Agreement: Yes

Section V: Award of contract/concession

V.2 Award of contract/concession

V.2.1) Date of conclusion of the contract/concession

16/12/2022

V.2.2) Information about tenders

The contract has been awarded to a group of economic operators: No

V.2.3) Name and address of the contractor

Academy Music Group Limited

003463738

211 Stockwell Road

London

SW9 9SL

UK

NUTS: UKI

The contractor is an SME: No

V.2.4) Information on value of the concession and main financing terms (excluding VAT)

Total value of the concession/lot: 45 000 000.00  GBP

V.2.5) Information about subcontracting

Section VI: Complementary information

VI.3) Additional information

Continued from II.2.4)

AMG will be able to provide a range of entertainment events at the Venue across the year. The majority of these events will be provided by third parties hiring the Venue although some may be provided by AMG directly.

The lease will require AMG to continue and maintain the classical music/community programme as part of the Venue’s annual offering, reserving at least 80 days per annum for hosting/staging such events.

There is also an obligation on AMG to provide operational and venue management services (such as those listed in II.2.2 (above) to support the classical programme events (“Services”). There will be no service charge payable by the Council to AMG for the provision of these Services.

AMG will make the Venue available for other events and hire by third parties outside of times reserved for the classical programme.

(WA Ref:132101)

VI.4) Procedures for review

VI.4.1) Review body

High Court

Royal Courts of Justice, The Strand

London

WC2A 2LL

UK

Telephone: +44 2079477501

VI.4.3) Review procedure

Precise information on deadline(s) for review procedures:

In accordance with Regulations 88 – 104 (enforcement of duties through the court) of the Public Contracts Regulations 2015 (as amended) and Regulations 49 – 64 of the Concession Contracts Regulations 2016.

Continued from Annex D4:

The Services that the Council requires AMG to provide (based on the minimum 80 day classical/community programme above) amounts to approximately 22% of the event days available in each year. The Council’s assessment of the estimated gross revenue potential for AMG for the Services during these days is estimated to be in the region of 750,000GBP per annum, before taking into account the costs incurred in providing those services and other general costs associated with operation and maintenance of the venue.

The Council considers that the obligation to provide a classical programme and supporting Services is incidental/ancillary to the main purpose of the transaction, for similar reasons to those given above because: (i) the value is small compared to the potential value of the operator opportunity; (ii) the main purpose of the transaction is to transfer the Venue to an independent operator and not the securing those activities; and (iii) these requirements would not have been pursued if the Venue was not being disposed of.

VI.5) Date of dispatch of this notice

05/06/2023


Information added to the notice since publication.

Additional information added to the notice since it's publication.
No further information has been uploaded.
Main Contact: corporate.procurement@cardiff.gov.uk
Admin Contact: N/a
Technical Contact: N/a
Other Contact: N/a

Commodity Categories

Commodity Categories
IDTitleParent Category
92312130Band entertainment servicesArtistic services
55410000Bar management servicesBeverage-serving services
55400000Beverage-serving servicesHotel, restaurant and retail trade services
79993000Building and facilities management servicesMiscellaneous business-related services
90911200Building-cleaning servicesAccommodation, building and window cleaning services
55330000Cafeteria servicesRestaurant and food-serving services
55500000Canteen and catering servicesHotel, restaurant and retail trade services
55520000Catering servicesCanteen and catering services
70332200Commercial property management servicesNon-residential property services
45000000Construction workConstruction and Real Estate
79952100Cultural event organisation servicesEvent services
92300000Entertainment servicesRecreational, cultural and sporting services
79952000Event servicesExhibition, fair and congress organisation services
79950000Exhibition, fair and congress organisation servicesMiscellaneous business and business-related services
79993100Facilities management servicesBuilding and facilities management services
79956000Fair and exhibition organisation servicesExhibition, fair and congress organisation services
79953000Festival organisation servicesExhibition, fair and congress organisation services
55120000Hotel meeting and conference servicesHotel services
70220000Non-residential property renting or leasing servicesRenting or leasing services of own property
70332000Non-residential property servicesProperty management services of real estate on a fee or contract basis
92312140Orchestral entertainment servicesArtistic services
55130000Other hotel servicesHotel services
70330000Property management services of real estate on a fee or contract basisReal estate agency services on a fee or contract basis
75241000Public security servicesPublic security, law and order services
92000000Recreational, cultural and sporting servicesOther Services
79710000Security servicesInvestigation and security services
79951000Seminar organisation servicesExhibition, fair and congress organisation services
92312120Singer group entertainment servicesArtistic services
92312100Theatrical producers, singer groups, bands and orchestras entertainment servicesArtistic services

Delivery Locations

Delivery Locations
IDDescription
1022Cardiff and Vale of Glamorgan

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