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Council probes Armory Hall finances: kitchens, turnkey model and possible subsidy
Summary
Councilors pressed consultants about how many turnkey kitchens the market can support, whether vendor rents would be market-rate or subsidized to achieve affordability, and whether a master operator or management agreement is the best approach; staff said cost estimates and a pro forma will come after a CM/GC RFP.
Council discussion of Armory Hall turned to money and operations: how many built-out kitchens the market can support, whether the city should subsidize vendor rents to achieve affordability, and what operator model would make the project viable.
Consultant Garrett Simon described operating-model work: "we ran an annual operating budget for both of them... I wouldn't call it a pro forma because it doesn't include development costs, so all the construction costs. So it was basically once up and running what those look like." Private-sector presenters and council members debated 3 versus 5 kitchens, the size of back-of-house and commissary needs, and the risk that several kitchens would struggle while a few anchors succeed.
Council member Tory raised the possibility of a consolidated or "master" kitchen and warned against making the mezzanine or upper floor a place likely to become a gated high-end restaurant rather than community space. Council member Bill asked specifically whether restrooms could be moved to a lower level to free prime ground-floor space for vendors and emphasized the need for adequate back-of-house workroom and storage.
On subsidies and leases, consultant Beau said the current operating budgets assume market-based percentage rent and that "at this time on the team, there's been no envisioning of subsidizing of any of the food vendors in any way." Council members said they are open to limited city subsidy to ensure affordability if pro formas show a gap, and staff said the CM/GC cost estimate is required before a complete pro forma can be produced and before issuing an operator RFP.
