Little-Known Spanish Firm Beats Out JC Decaux and Van Wagner

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NEW YORK (AdAge.com) -- A little-known company, Cemusa, has beaten outdoor advertising giants JC Decaux and Van Wagner for New York City’s 20-year contract to sell ad space on bus shelters and newspaper kiosks, according to the city's Department of Transportation.

20-year contract
The franchise agreement calls for the Madrid-based company to pay the City of New York $1 billion for the 20-year contract as well as create 3,300 new bus stop shelters, 330 new newsstands and up to 20 automatic public toilets. Cemusa said in a statement it also expects to create 100 new jobs in New York City.

The company has retained Nicholas Grimshaw & Associates, the architecture firm that designed Manhattan's Fulton Street Transit Center, to design the structures.

Viacom Outdoor currently maintains and sells advertising on the city’s bus shelters.

The win is huge for Cemusa, which is trying to establish a larger U.S. presence. Cemusa’s other U.S. operations are primarily located in Miami-Dade County, Boston and San Antonio. Cemusa is owned by Fomento de Construcciones y Contratas (FCC), one of Spain's largest construction conglomerates.

Blow to JC Decaux
But even more than the importance of the win for Cemusa, it’s a blow to France-based JC Decaux, a global outdoor

A Cemusa/Grimshaw bus shelter-with-ad-boards design installed in Madrid.
giant that’s working hard to expand in the U.S., and Van Wagner, a New York-based outdoor company that’s rebuilding its properties after selling off much of its spectacular Times Square inventory in the late 1990s. Clear Channel Outdoor and Viacom were also lobbying hard for the contract but each was eliminated earlier in the process.

Representatives from several city agencies, including the departments of Transportation, City Planning, Consumer Affairs, Parks and Recreation and Design and Construction and the New York City Economic Development Corporation, conducted an intensive evaluation of the candidates, requiring them to submit detailed technical plans, financial information and scale models and drawings.

Negotiations next step
Negotiations with Cemusa are the next step in the process, and while DOT anticipates discussions will go smoothly, failure to successfully negotiate could result in the city offering an invitation to negotiate to another company.

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