Southsea Castle - Catering & Events Concession Opportunity - Preliminary Market Engagement

Description

Portsmouth City Council (the Council) is undertaking a Preliminary Market Engagement (PME) exercise to inform the future procurement strategy for catering and event services at Southsea Castle. As a visitor attraction and site of importance, the council aims to, through this procurement process, deliver new areas of growth for Southsea Castle. The successful operator must have a desire to create a destination cafe / restaurant and enhance the catering offer for private events and weddings. THE SITE Southsea Castle, built in 1544 by King Henry VIII as part of his coastal defence scheme, is a historic, Scheduled Ancient Monument and a site of national importance. Southsea Castle now operates as a visitor attraction and museum, restaurant, and historic wedding & events venue. The Castle attracts upwards of 10,000 visitors per month over the summer season, and offers members of the public free access to the castle keep, ramparts, shop & viewing rooms from April - October. The restaurant in Southsea Castle is open all year round, and the Castle hosts numerous events throughout the season, in particular weddings & corporate events, as well as community events. During the opening season, there are also local makers market's hosted in the marquee, as well as heritage tours and talks hosted by the museums team. All events hosted by the museums team are aimed at engaging with the local community and increasing the visitor experience at Southsea Castle. The Castle courtyard, keep, ramparts and museum rooms are open to the public from 10am - 5pm, Tues - Sunday's and bank holidays, from April - October, and are closed over the winter period. The restaurant is open all year round, currently from 9.30am - 5pm every day in the summer season, and Wed-Sun 9.30am - 5pm in the winter season. It would be a requirement that on days the castle is open to the public that the restaurant is also open. CONCESSION AGREEMENT & COMMERCIAL MODEL The current concession agreement for the Southsea Castle catering operation is based on a hybrid commercial model that combines both fixed and performance‑based rental elements. Under the existing arrangement, the operator pays the Council an annual base rent of £32,000. This figure reflects the minimum financial return the Council would expect to achieve in order to ensure the asset remains commercially viable. The Council would also expect this base rent to be uplifted annually, in line with CPI, to maintain the real value of the income over the duration of the agreement. The Council will likely seek to increase the rental income it currently receives through the procurement process but is keen to understand the markets position through the PME process before finalising its commercial strategy. In addition to this guaranteed rent, the concession agreement includes a turnover‑share mechanism, through which the operator pays a percentage of gross revenue generated from restaurant operations, café trade, weddings, corporate events, and other hospitality activities. The Council is likely to include for a revenue share element within the future procurement as either a mandatory or optional bidding element. The Council is also considering applying minimum and maximum revenue % values through the bidding process. Again, the Council is keen to take feedback from the market on this commercial element via the PME process. The existing commercial model reflects the scale of the operation, which has historically generated an anticipated annual turnover in the region of £500,000 to £600,000, dependent on seasonal trading patterns and the volume of weddings and events delivered. Initial considerations include adopting a revised lease term comprising an initial 5 year period, with options to extend the total term to 15-20 years, subject to performance and at the discretion of the council. This structure should support operator investment in catering equipment, bar infrastructure, interior fit out and service improvements, whilst ensuring the Council maintains a financially robust and sustainable partnership arrangement. However, the Council is keen to gain feedback through the PME process on any mutual benefits that a longer than 5-year base term could deliver as well as provision of different extension options. FUTURE PROCUREMENT STRATEGY At this stage, the Council has not yet determined the exact procurement process that will follow this Pre‑Market Engagement (PME). However, based on the nature of the requirement, the feedback received to date, it is most likely that the Council will adopt a Competitive Flexible Procedure (CFP) under the Procurement Act 2023. The CFP offers the flexibility for a procurement approach similar to Competitive Dialogue under the previous Public Contract Regulations 2015, and the Council anticipates structuring the process in two stages, as follows: STAGE 1 - INITIAL PROPOSALS Operators will be invited to submit tender proposals demonstrating how they intend to deliver the catering operation at Southsea Castle, including commercial, operational, heritage sensitive and visitor experience considerations. These submissions will be evaluated against published criteria, taking into account qualitative and pricing elements. In addition to the assessment of tender submissions, Operators should be aware that progression to the subsequent stages of the procurement will be subject to meeting a set of Conditions of Participation. These are expected to include, but may not be limited to: • Financial standing requirements • Minimum experience criteria, including the ability to evidence delivery of catering, restaurant, bar and event operations of a comparable scale. • Insurance requirements, such as public liability, employer's liability, and product liability at levels to be set out in the tender documents. • Mandatory and discretionary exclusion grounds, as required under the Procurement Act 2023, which all Operators must formally declare. • Debarment checks, undertaken via the government's Central Digital Platform, which all Operators must be registered on as part of the tender process. • Relevant professional and operational accreditations, where applicable (e.g., food safety, environmental health, sustainability credentials, licensing compliance). • Health & Safety and Environmental Health record. Stage 2 - Shortlist & Refinement A shortlist of the highest‑scoring Operators will be invited to refine their proposals in greater detail. This stage is expected to include further dialogue, solution development, and clarification of operational and commercial models before final tenders are submitted. It is likely that a maximum of 3 highest scoring operators will be invited to submit 2nd stage best and final offer bids. STAGE 2 - SINGLE COMPLIANT BIDDER / HIGHEST SCORING BIDDER SCENARIO If, at the conclusion of Stage 1, only one bidder meets the minimum requirements and is capable of delivering the contract, or multiple compliant bids are received but at stage 1 assessment the highest scoring bidder's score is significantly higher (probably more than 20% margin to be applied) than the next placed bidder, the Council reserves the right to engage directly with that operator on a negotiated basis to complete the procurement. This will be carried out in compliance with the flexibility afforded by the CFP under the Procurement Act 2023. ISSUE OF CONTRACT TENDER NOTICE The Council will confirm the chosen procurement route in due course, by issuing a Contract Tender Notice outlining the key details and requirements. The Council anticipates that this opportunity will be classified as an above-threshold concession under the Procurement Act 2023. This will be confirmed upon publication of the tender notice. PME & PROCUREMENT TIMETABLE The Council are intending to run the PME and the subsequent envisaged tender process under the following Procurement Programme: 1. Publish PME Notice - Tuesday 24th February 2026 2. Site visit and briefing - Tuesday 10th March 2026 from 16:30 to 19:00 3. 1-2-1 supplier discussion - From Tuesday 10th March 2026 to Wednesday 18th March 2026 4. Issue of Tender Notice and 1st Stage Call for Applications & Invitation to Participate in Dialogue - Monday 13th April 2026 5. Site Visit (condition of tendering) - Monday 27th April 2026 between 14:00 and 15:30 6. 1-2-1 dialogue meetings - From Monday 4th May 2026 to Friday 15th May 2026 7. Request for clarification deadline - Wednesday 20th May 2026 by 16:00 8. 1st Stage CFP proposals return - Tuesday 26th May 2026 by 12:00 9. 1st Stage CFP shortlisting decision notification - Friday 5th June 2026 10. Issue of 2nd Stage Invitation to Partake in Further Dialogue & Submit Tendered Proposals - Monday 22nd June 2026 11. 2nd stage dialogue meetings - From Monday 29th June 2026 to Friday 3rd July 2026 12. Request for clarification deadline - Wednesday 8th July 2026 by 16:00 13. Deadline for submission of 2nd stage tendered proposals - Friday 17th July 2026 by 12:00 14. Evaluation of 2nd stage tender proposals including for any post tender clarification & negotiation meetings - Monday 20th July 2026 to Friday 7th August 2026 15. Notification of award decision, issue of assessment summaries and publication of Contract Award Notice - Monday 17th August 2026 16. Standstill Period - Tuesday 18th August 2026 to Thursday 27th August 2026 17. Preferred bidder secured and confirmation of contract award - Friday 28th August 2026 18. Contract Start - Monday 1st February 2027