Smart Procurement Cuts £200,000 from a Waterloo Restaurant Fitout

How Bonavia Ltd used value engineering, split trade packages, and direct materials purchasing to deliver Passyunk Avenue’s Leake Street restaurant at 40 per cent below the original scheme cost.

When Passyunk Avenue signed a lease on Unit 5 beneath the Leake Street arches in Waterloo, they inherited a characterful but demanding shell. Brick railway arches rarely come ready to trade, and the original fitout scheme carried a price tag to match. 

Bonavia Ltd, appointed to provide quantity surveying and project management services for the £500,000 project, identified from the outset that the cost could be substantially reduced without compromising the quality of the finished restaurant. The approach combined three interlocking strategies: securing a landlord capital expenditure contribution, value engineering the design, and restructuring the procurement to remove unnecessary margin from specialist packages.

Agreeing the Landlord Contribution

Before a contractor was appointed, Bonavia turned its attention to the building’s base condition. The arches required remedial works; costs the landlord was liable to contribute towards but which required substantiation. 

A detailed cost plan was prepared covering the full remedial scope and taken to the open market, gathering competitive pricing to demonstrate the costs were fair and reasonable. The exercise produced an agreed landlord contribution that materially reduced the client’s net exposure before the fitout had begun.

“Getting the landlord contribution settled at the outset removes a significant variable. Without a properly evidenced cost plan, clients often leave money on the table.”

40 Per Cent Saved Through Value Engineering

With the landlord position resolved, Bonavia worked alongside the project’s design consultants to systematically review the specification. The objective was not to cut corners but to identify expenditure that was not translating into a better restaurant for guests. 

The value engineering process reduced the scheme by 40 per cent against the original design cost; a saving of approximately £200,000. Material selections, construction sequences, and finishing specifications were all scrutinised, with changes agreed only where the client’s brand standards were unaffected. 

Value engineering is not about cheapening a design. It is about understanding where money is actually doing work, and where it is not. In a restaurant fitout, that distinction matters; every pound spent should be visible and felt by the people eating there.

Splitting the Trade Packages

Following a single-stage traditional tender, Bonavia entered into a JCT Standard Building Contract with Contractor Design Portion (CDP) with a Principal Contractor. The CDP element transferred design responsibility for specific elements to the contractor; reducing coordination layers where the contractor was best placed to develop the detail. 

Critically, the mechanical and catering packages were carved out and tendered separately. In a commercial restaurant, these are substantial scopes; and when bundled through a general contractor, they carry that contractor’s margin on top of specialist subcontract pricing. 

By going directly to the specialist market for each package, that overhead was removed entirely. Competitive pricing from contractors whose sole business is mechanical or catering installation produced materially lower costs than a single-contractor route would have achieved. 

The risk inherent in splitting packages lies in programme and interface management: who sequences the mechanical first fix, who is responsible for builder’s work openings, who signs off catering connections before kitchen commissioning. Bonavia actively managed these interfaces on site, ensuring the savings were not eroded by delay or dispute.

Purchasing Materials Directly

Alongside the package split, a direct purchasing approach was taken for defined materials and equipment. Where a specification is fixed, quantities are known, and lead times are manageable, procuring materials on behalf of the client and supplying them to the contractor strips out a further layer of contractor margin. 

For a restaurant fitout with a defined furniture, fixtures and equipment schedule and a known kitchen equipment list, the conditions for direct purchasing were well suited. Orders were tracked, deliveries coordinated to programme, and materials confirmed on site ahead of installation.

Delivered on Programme

Passyunk Avenue’s Waterloo restaurant completed in March 2022, on programme and within the agreed contract sum. The Leake Street arches location; one of London’s most visited cultural spaces; opened trading without delay. 

The project demonstrates the value of treating procurement strategy as a design exercise in its own right. How a project is structured commercially; which packages are split, what is purchased directly, how landlord obligations are established; shapes the financial outcome as decisively as any technical specification. 

Client: Liberty Cheesesteak LS Company (Passyunk Avenue). Completed: March 2022. Quantity Surveying and Project Management services provided by Bonavia Ltd.