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Portsmouth City Council ("the Council") is inviting tenders from suitably qualified and experienced catering and events operators for the delivery of catering and events services at Southsea Castle, under a long term commercial arrangement comprising a combination of rental income and an incentivised revenue share mechanism.
The council is using a single stage competitive flexible procedure for the procurement of this contract, which includes conditions of participation and detailed tender proposals to be submitted at the same time.
The procurement is structured into two alternative lots which represent different contract term options for the same service requirement:
Tenderers are invited to submit a response for one lot only, selecting the contract term option which best reflects their proposed delivery model, investment approach and commercial offer.
The Council intends to award a single contract under either Lot 1 or Lot 2, based on the Most Advantageous Tender (MAT).
Award of the contract is targeted for 21st September 2026. The successful operator will be required to seamlessly commence operations under a lease with associated concession arrangement from 1st February 2027 following expiry of the lease held with the current incumbent operator on 31st January 2027.
Southsea Castle
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.
| Lot | Title | Value |
|---|---|---|
| 1 | Standard Term Concession (5 + 5 years)This Lot relates to the delivery of catering and events services at Southsea Castle, as described in the Competitive flexible procedure description of this notice. Lot 1 represents the Council's baseline contract structure, comprising an initial term of 5 years with the option to extend by up to 5 years (maximum 10 years total). Tenderers are required to submit a bid for Lot 1, which forms the core basis for evaluation and comparison across submissions. The total estimated value of the concession opportunity is approximately £8,200,000 (excluding VAT), or £9,840,000 (including VAT), based on a maximum contract term of 10 years. The procurement is structured into two alternative lots which represent different contract term options for the same service requirement. Only one lot will be awarded. Due to system limitations within the Find a Tender Service, the values attributed to each lot are required to be entered individually and are therefore displayed as cumulative. This does not reflect the actual procurement value. The stated lot values should not be aggregated, and the overall value of the opportunity remains as set out above. | £8,199,999 |
| 2 | Extended Term Concession (7 + 3 years)This Lot relates to the delivery of catering and events services at Southsea Castle, as described in the Competitive flexible procedure description of this notice. Lot 2 provides an alternative contract structure, comprising an initial term of 7 years with the option to extend by up to 3 years (maximum 10 years total). Submission for Lot 2 is optional. Tenderers submitting for this lot must clearly demonstrate the additional value, investment or benefits delivered as a result of the longer initial contract term. The total estimated value of the concession opportunity is approximately £8,200,000 (excluding VAT), or £9,840,000 (including VAT), based on a maximum contract term of 10 years. The procurement is structured into two alternative lots which represent different contract term options for the same service requirement. Only one lot will be awarded. Due to system limitations within the Find a Tender Service, the values attributed to each lot are required to be entered individually and are therefore displayed as cumulative. This does not reflect the actual procurement value. The stated lot values should not be aggregated, and the overall value of the opportunity remains as set out above. |
Permitted Uses, Opening Times & Access
The permitted use of Southsea Castle comprises a combination of public-facing restaurant operations and a programme of private and operator-led events, with defined parameters around access, capacity and shared use. The restaurant and café, located within the western side of the castle courtyard, provide approximately 60 internal covers and up to 54 external covers (subject to layout). The space can also accommodate private events of up to 60 seated or 80 standing guests. The operator is required to provide a daily service as a minimum between 9:30am and 5:00pm, with flexibility for evening trading and private hire where this does not conflict with Council-managed bookings.
Private events are delivered across a range of spaces. The marquee is the primary large-scale event space, with a capacity of up to 120 seated or 200 standing guests, and is managed by the Council. This space is used for weddings and corporate functions but may also be utilised by the operator as part of their own event programme, including catering and bar provision. The castle keep is also used for ceremonies and smaller events but remains under Council control and is not available for operator-led events.
Additional areas, including the castle ramparts and an ancillary bar or function room, may be used to support events where appropriate and subject to approval. These spaces provide flexibility to enhance the visitor and event experience whilst ensuring compliance with health and safety requirements.
The operator will share access to back-of-house and storage areas with the Council, including spaces used for equipment, stock and event furniture. These arrangements require coordinated use and may be reviewed periodically to ensure suitability.
Operations must also accommodate external events. At times, large-scale events may restrict or suspend access to the castle, during which the operator will not be permitted to trade. In contrast, other events may increase footfall and present additional trading opportunities, with the Council providing advance notice where required.
The operator must ensure the site remains open to the public for a minimum of 50 weeks per year and deliver a catering and events offer that supports growth. This includes providing catering for Council-managed events and developing an independent programme of activities outside core hours to enhance the site's profile as a destination venue.
All activities must reflect the building's status as a Scheduled Ancient Monument, ensuring a balance between commercial use and the preservation of the site.
Revenue Share and Lease Fee
The lease will be subject to rental fee and revenue share payments from the operator to the Council. The Council is targeting a minimum guaranteed annual rental payment of £32,000 over initial 5 years of the lease. Rental payments are to be made in advance on a quarterly basis.
Operators will be required to propose a revenue share percentage to the Council in Year 1, which should not fall below 3% and not be higher than 10%, without justification. Where a proposal falls below or above this range, the Council may consider the bid to be abnormally low or abnormally high and reserves the right to undertake further investigation and seek clarification from the bidder.
The proposed revenue share percentage is not expected to reduce following Year 1. Where a bidder proposes a reduction in revenue share percentage over the contract term, the Council reserves the right to investigate the rationale and set aside the bid where this cannot be satisfactorily justified.
The revenue share percentage proposed by operators may vary over the term of the agreement but must always be within the range stated. Revenue share payments are to be made within 30 days at the end of each contract year.
Based upon current revenue and subject to indexation the Council estimates that the successful Operator could achieve a turnover figure of approx. £600K. However, the Council considers that there are significant opportunities to increase revenue though investment, events, food offer, advertising, etc. which could have a major positive impact upon revenue generation, potentially increasing revenue generation.
Based on an estimated annual turnover of £600,000 in Year 1, the Council anticipates that the total value of the concession opportunity over the potential 10-year contract term could be in the region of £7 million to £8 million. However, it should be noted that all estimates in respect of the value of the business opportunity are purely indicative and provided to comply with the requirements of the Procurement Act 23 in relation to publication of estimated contract values. All figures are non-binding, the Council is providing no guarantees and accepting no liability in the event that the actual value of the business opportunity over the term of the contract falls significantly above or below the guide estimates provided.
The specification includes for clearly defined performance standards, service levels and KPIs covering the following areas:
The Council is seeking to establish a partnership relationship with the successful Operator based on the following principles
The Operator will be required to align with the Council's Social Value Policy in a manner which provides targeted meaningful impact to individuals, communities, the environment and local economy.
All repairs to the spaces occupied must be undertaken with the necessary permissions in place from both Historic England and the Council which reflects the status of the Castle as a Scheduled Ancient Monument.
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