Burger King exits Sangster Airport due to ‘draconian’ rent
BURGER King exited its store in the Sangster International Airport this week due to what franchise holder Richard Lake described as the most expensive and draconian ‘rent’ in the country.
MBJ Airports Ltd, which manages the airport, preferred to describe the fees as equitable and within the international norm.
The airport wants a minimum of US$135,000 ($15 million) a year for the 1,500 sq ft space, or US$7.50 a sq ft each month.
Additionally MBJ Airports charges for a portion of annual sales should the store’s sales surpass US$750,000.
“Its the most expensive space in Jamaica,” Lake said in a phone interview on Wednesday. “Their attitude was very draconian. There was never any discussion with them it was always instructions.”
The popular fast-food chain vacated the space on Tuesday after its five-year licence expired at the venue on September 30. Burger King will avoid rushing to add a new location for now.
“We have several landlords and we have to say that by far they are the worse. By far the worse,” he recalled. “It was unprofitable for us but we stayed there for the brand exposure.”
Elizabeth Scotton, chief commercial officer at MBJ Airports, said that it “wouldn’t be appropriate to comment” on claims of draconian management. As a consequence, the airport has invited other food and beverage restaurants to bid for the space.
“It is a valuable location and a valuable opportunity. It is in the departures area, it is seen by the public and airport employees,” Scotton said of the guaranteed traffic. “The expectation is that the sales would also match that opportunity with a good operator. Our perspective is that when our concession is successful then we are successful.”
MBJ Airports wants a brand that will generate sales beyond US$750,000 in order to fortify its fees. Scotton declined to confirm or deny whether overseas franchise Dairy Queen aims to enter the airport.
“The location is free and open for the market to apply for,” she said of Dairy Queen. “I do not know who will apply.”
MBJ Airports charges fees rather than rent as it manages and does not own the airport. It is owned by Spain-based Abertis Airports and Canada-based Vantage Airport group, under a 30-year agreement with the Government.
Over the past decade, MBJ Airports invested a total of US$193 million in capital infrastructure improvements.
The airport offers 6,000 square metres of space in the International Terminal Building dedicated to retail opportunities comprising duty free, specialty retail, food & beverage and other services.
The airport shuttled 3.5 million passengers in 2013.