You are correct. It's a new wall which appears to cover the exterior wardrobe sidewalk at tunnel level. Beyond that, I can't tell where they are going next?
The BatB restaurant has it's loading docks at tunnel level which implies at least a tunnel level receiving area, possibly food storage/kitchen, too. Whether they run a tunnel to the existing tunnels only WDI knows. The tunnel to the meet and greets, which was on the famous leaked plans I would guess is probably in question until that area is finalized.
Since BatB's food areas are beyond the tunnel main entrance, to the north, perhaps they may have their own doors out into that area (where the CM bus drop-off is).
Their original tunnels were built using extremely sturdy construction (thick concrete walls, lots of rebar, etc) since they'd have to withstand constant lateral pressure from ground water and the forces exerted from whatever is above them (pavement, building, vehicles, etc). Building more tunnels could be almost cost-prohibitive today.
They'd also have to cut open the existing tunnels and compromise their waterproofing. That's like doing surgery on someone who doesn't really need it. If I were them, I'd be very hesitant to compromise the barrier and probably just leave the tunnels alone. But that's just me saying, "leave well enough alone."
Maybe they aren't. Remember when someone on this board (sorry I can't remember who exactly) said that filing for a renovation is much less expensive than filing for construction. They need to leave something up, so maybe they will use the arched wall for something. :shrug:
If they were talking about the cost of filing for building permits, they're right that a permit for new construction costs more than one for a remodel. However, the cost of a building permit should never been the determining factor in whether a commercial project moves forward or not. They'll spend more money on the paper they print all their blueprints on than they will/did for the building permit.
Besides, leaving one wall up doesn't constitute a "renovation". BatB and LM are both "new construction" by most jurisdictional definitions.
Also, I don't know how Orange County and RCID work, but many jurisdictions will charge a rate for the permit based on the cost of construction, while some charge based on the square footage of the new building.