Zurik: Airport vendor left local businesses and non-profits with reduced visibility and broken promises

Pacific Gateway’s initial pitch for the project was for dedicated spaces for New Orleans businesses and non-profits
Updated: May. 19, 2020 at 9:55 PM CDT
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NEW ORLEANS, La. (WVUE) - When the new terminal at the Louis Armstrong New Orleans International Airport opened it had several New Orleans features included -- but its what was missing that has some local businesses feeling left at the gate.

Pacific Gateway, a San Francisco-based company, landed the lucrative airport contract for shops in the new terminal of the airport.

In their pitch to airport leaders, they included drawings and videos of what the new spaces would look like with New Orleans businesses and non-profits being showcased.

Some of the companies in the company’s flashy video pitched to the airport -- Harley London, Preservation Hall and Hattie Sparks.

With years of construction over and the airport terminal now open to the public, the faces, products and brands showcased by Pacific Gateway can’t be found in the airport.

Once the California company was awarded the contract by the airport, businesses tell us the deals with them evolved, and in many cases, evaporated.

“It was going to be life-changing in a great way,” Hattie Moll said.

Moll was the owner of the boutique Hattie Sparks and was set to have her own store at the airport in the Pacific Gateway project with the company even providing her with renderings.

“I spoke in front of [the] aviation board a few times. I went to city council meetings with them. They asked me regularly to ask people in my network, professional, or personal acquaintances to come with me to these meetings so they could have a bigger showing of support than other groups," Moll said. “And I did that. Because I was committed and I was on board. And they got what they wanted and slowly started backing away.”

After the airport awarded Pacific Gateway the contract, Moll said she tried reaching the group several times and did not receive a response for seven months.

“They were in constant contact up until their contract was awarded and it was pretty obvious that once the contract was awarded, that they were backing away behind the scenes,” Moll said. “It was disappointing, it was unprofessional, I feel like it was disrespectful.”

Eventually, she received a response, Pacific Gateway changed her deal from a store to a free-standing storefront. Almost a year after that change, her area was scaled back again.

“We’re going to give you four shelves in a marketplace and we want you to develop and produce your won private label,” Moll recalled being told of the changes.

Moll said having her own line was not part of her business model, but she spent thousands of dollars testing and developing products for the airport venture. However, a month after that meeting, communication once again stopped.

“So I went from a free-standing store in the terminal, to a section in a marketplace to four shelves with products I was supposed to spend money on to develop,” Moll said.

Charlotte Henry is a disabled veteran, her company, Harley London, was a thirty percent joint venture partner in the project.

“This opportunity is miraculous because you never know who is going to see your products, you never know who is going to walk into your shop,” Henry said in Pacific Gateway’s promotional video.

Henry’s business is registered with the City of New Orleans as a Disadvantaged Business Enterprise or DBE. The city requires a DBE to be part of every city contract.

After Pacific Gateway signed the deal, Henry’s role ended. She told FOX 8′s Lee Zurik by phone, “I feel like someone won the contract and we were no longer valuable to them."

Currently, the contract has no active DBE.

“I’m very mad and upset,” City Councilmember Jared Brossett said.

Brossett is councilmember for District D and serves on the council’s Transportation and Airport Committee. The council does not award contracts for the airport, that falls under the airport’s own board, however, Brossett said he feels not having a disadvantaged business enterprise is a serious problem.

“Which I believe is definitely a violation of the city’s requirements, the aviation board, as well as the Office of Civil Rights at the FAA [Federal Aviation Administration.]” Brossett said.

After the airport awarded Pacific Gateway the contract, the company was sold to Stellar Partners. Stellar’s parent company is HMSHost, which operates in 120 airports worldwide.

In the proposal Pacific Gateway submitted to the New Orleans Aviation Board, the company complimented the work of the non-profit YAYA, short for Young Artists Young Aspirations.

“We’re a nonprofit provides visual arts training young people 5 to 25,” Meg Miles, YAYA’s Executive Director, said.

Pacific Gateway promised YAYA an area for the display and sale of art pieces by YAYA’s young artists to ‘financially’ support the work of the institution and help the ‘young artists gain some commercial success.’

“My understanding was that it would be a whole area that would have signage, talk about what we do and encourage people to visit the YAYA Art Center,” Miles said.

Instead, Pacific Gateway scaled back YAYA’s deal too.

“We have a portion of a table in a newsstand that has a handful of glass pieces on it,” Miles said.

She said the average person walking through the airport likely would not even notice YAYA’s place and know why they are in the airport.

“To be honest, I don’t think the display is a great representation of who we are or the level of artistry coming out of our program," Miles said.

While YAYA is disappointed, they are hopeful that HMSHost will expand their airport presence.

“I still feel there’s a great opportunity for us there,” she said. “And I hope that we’ll be able to land on something that everyone is really proud of.”

Other non-profits and businesses that were part of the pitch by Pacific Gateway and have now been scaled back or don’t exist at all in the new airport include the Southern Food and Beverage Museum, Preservation Hall and juice shop, Pulp and Grind.

“I staked a lot, both professionally and financially on the promises and projections that Pacific Gateway had made to me and to my business’s involvement,” Moll said.

The owner of Hattie Sparks said Pacific Gateway’s deal was life-changing for her and it was, but not for the better. Because of the broken promises, Moll scaled back her business, eventually shutting it down.

“They knew that the New Orleans market rallies behind its local businesses and really appreciates people supporting those, larger companies coming in and supporting the local economy here,” Moll said. “They used that to their advantage. Once they got what they wanted they dropped most, if not all, of us.”

Some small New Orleans area businesses did survive the deal and do have a presence at the new airport terminal.

FOX 8 wanted to ask the airport about what happened with the deal and why it was not looking out for the small businesses involved, but the airport’s director, Kevin Dolliole, declined our request for an interview.

The airport did release the following statement regarding the lack of a DBE on the project:

The New Orleans Aviation Board’s concession lease is with PGC MSY Venture, LLC. Harley London is currently the Airport Concessions Disadvantaged Business Enterprise (ACDBE) joint venture partner with Stellar (formerly with Pacific Gateway) in PGC MSY Venture, LLC. Stellar is in the process of replacing its ACDBE joint venture partner with another ACDBE firm. This process is closely monitored by the Airport’s Disadvantaged Business Enterprise Liaison Office to ensure program compliance and that the ACDBE goals are met. Thus far, Stellar’s actions in replacing Harley London are in compliance with the FAA’s ACDBE regulations.

HMSHost also did not respond to our request for comment for this story.

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