Business Observer 8.3.18 by Kat Hughes

AU G U S T 3 - AU G U S T 9, 2018 | TH R E E D O LL A R S

FLOR IDA’S NE WSPAPER FOR T HE C - SUI T E

Strategies | Necessity leads pharmacist to invention — and unseen opportunity. PG.10 PASCO • H ILL SBOROUG H • PIN ELL AS • P OLK • M A N ATEE • SA R ASOTA • C H A R LOT TE • LEE • COLLIER SPECIAL ISSUE

MADE ON THE

GULF COAST PAGES 7 THROUGH 15

Knead to Grow A slow, deliberate production pace has been a bread maker’s counterintuitive edge. Can it fend off competitors as it expands? PAGE 12

Copeland and Tony More | LA SEGUNDA BAKERY CAFÉ

REAL ESTATE

ECONOMY

STRATEGIES

CONSTRUCTION

Market Heights

Table Setters

Spring Into Action

MANUFACTURING

STARTUPS

HOSPITALITY

Makers and Takers

Grab Bag

Trip Around the Sun

A pair of markets in the region — Sarasota and Naples — climbs to the top of a luxury real estate list. PAGE 6

The area manufacturing sector shows signs of promise. One obstacle: a crippling labor shortage. PAGE 7

A f ter cha ng ing where she lived, Gretchen Bauer shifted careers. Now she’s a novice handbag manufacturer. PAGE 10

The team behind a $125 million spring training facility in south Sarasota County races against the elements. PAGE 14

Hotel developers leverage the Jimmy Buffett lifestyle for pair of new projects coming soon to the region. PAGE 16

Alabama firm buys Fort Myers property for $6.4 million. 16 St. Petersburg Pier project expands tenant list. 16 Six-story Tampa office building hits market for $39.5 million. 17

PAGE

18 Airport seeks to land new, long-term revenue streams. industry insights

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DON’T MISS

Andrew Watson’s 6-year-old Tampa furniture business has sharpened its approach in anticipation of a big year. PAGE 8

BUSINESS OBSERVER | AUGUST 3, 2018 - AUGUST 9, 2018

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Vol. XXII, No. 27

BY JENNIFER FOWLER-HERMES | BOARD CERTIFIED LABOR & EMPLOYMENT ATTORNEY

A Division of The Observer Media Group

BusinessObserverFL.com Founded in 1997, the Business Observer is Southwest and Central Florida’s newspaper for business leaders. With offices in Hillsborough, Pinellas, Polk, Pasco, Manatee, Sarasota, Charlotte, Lee and Collier counties, the Business Observer is the only weekly business newspaper that provides business leaders with a regional perspective. The Business Observer’s mission is to deliver relevant news and information on Southwest and Central Florida’s leading and growing companies, up-and-coming entrepreneurs and economic, industry and government trends affecting business. The Business Observer is also the leading publisher of public notices on the Gulf Coast of Florida.

Editor and Publisher / Matt Walsh, mwalsh@BusinessObserverFL.com Executive Editor / Kat Hughes khughes@BusinessObserverFL.com Managing Editor / Mark Gordon mgordon@BusinessObserverFL.com Commercial Real Estate Editor / Kevin McQuaid kmcquaid@BusinessObserverFL.com Tampa Bay Editor / Brian Hartz bhartz@BusinessObserverFL.com Lee-Collier Editor / Andrew Warfield awarfield@BusinessObserverFL.com Staff Writer/ Grier Ferguson gferguson@BusinessObserverFL.com Editorial Design / Nicole Thompson Contributors / Steven Benna, Ted Carter

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“The road is cleared,” said Galt. “We are going back to the world.” He raised his hand and over the desolate earth he traced in space the sign of the dollar. Ayn Rand, Atlas Shrugged 253355

XNLV14753

Business Observer's Industry Insights allows brands and businesses to connect directly with the Business Observer's readership--and participate in the conversation—by creating engaging content on the Business Observer's digital publishing platform. To learn more email us directly at industryinsights@businessobserverfl.com.

PO Box 3169 Sarasota, FL 34230 1970 Main St., Suite 400, Sarasota, FL 34236 Phone: 941-362-4848 Phone: 941-906-9386 (Legal Notices) Fax: 941-954-8530

Charlotte County

Address: 949 Tamiami Trail, Suite 202 Port Charlotte, FL 33953 Phone: 941-906-9386 (Legal Notices) Fax: 941-954-8530

In light of all of the attention that the street getting cat-called by is being focused on issues relat- a stranger, do not implicate the ing to harassment and the #me- workplace at all. However, if that too movement, employers that do same woman works for a construcnot take time to review policies tion company and is walking past and train employees may be at a other employees of the organizad i s a d v a nt a ge tion when she if claims ever is cat-called by It is now more importarise. It is now them, the same more important ant than ever for employers conduct may be tha n ever for to develop a better underworkplace haemployer s t o standing of what constira ssment a nd develop a better tutes harassment in the actionable. Not understanding all harassment workplace, as well as how of what constiis immediately t ut e s h a r a s s - to prevent, recognize, and obv iou s, a nd m e n t i n t h e respond to harassment. answering the workplace, as JENNIFER FOWLER-HERMES question “what well as how to BOARD CERTIFIED LABOR & EMPLOYMENT is harassment?” pr event , r e c - ATTORNEY, WILLIAMS PARKER can sometimes ognize, and rebe a difficult spond to harassment. Sexual (and task. Are you able to recognize it? other) harassment training is not For more information on what just about reviewing company pol- is considered actionable harassicies and telling employees how ment, visit The Williams Parkto report complaints. Training er Labor and Employment Blog should be tailored for the specific (www.williamsparker.com/LEblog). workforce, in person, and promote respect and civility. It should be w w w.bu si nes sobser ver f l.com / geared to help employees at all williams-parker levels in an organization recognize harassment and when others are uncomfortable. In addition, employees that are responsible for receiving, investigating, and responding to complaints should be trained on how to properly fulfill these duties. Harassment can occur both inside and outside of the workplace. Certain forms of harassment, Phone: 941.366.4800 such as a woman walking down Website: www.WilliamsParker.com

5570 Gulf of Mexico Dr., Longboat Key, FL 34228 Phone: 941-362-4848 Phone: 941-906-9386 (Legal Notices) Fax: 941-954-8530

Sarasota County

15050 Elderberry Lane, Suite #4-12 Fort Myers, FL 33907 Phone: 239-703-7802; Fax: 941-954-8530 (Legal Notices)

WHAT’S AN EMPLOYER TO DO IN THE AGE OF #METOO?

Manatee County

AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

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CoffeeTalk

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A ceremonial groundbreaking for the Newcastle Aviation headquarters was held July 10. It is scheduled for completion January 2019.

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New castle

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the company, the release states. Newcastle currently employs 11 people, and CFO Rich Ogle tells Coffee Talk about seven to eight of those employees will relocate. Incentives were just one factor that attracted Newcastle. “There is obviously the climate, but it also puts us close to one of the hotbeds in the aviation industry,” says Ogle. “In Florida, the No. 1 industry by GDP is aviation and aerospace. Taxes were another consideration as well as the health of the economy of Lee County and Southwest Florida.” Founded in 2006, Newcastle provides asset management, sales, acquisitions, leases and appraisals on aviation components and parts. In addition to office space, the new building will include a warehousing area and room for expansion. “We hope that this will be the first of several projects under the Qualified Target Industry Tax Refund with the state of Florida and Lee County as we continue to grow and our hiring needs increase,” Ogle says. The move also presents a growth opportunity for Newcastle. The company, Ogle says, was constrained by the lease and rental market in the Twin Cities area. “We ended up determining the economics of buying land and building were favorable,” he adds.

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A penny for your (print) thoughts Penny Hoarder CEO Kyle Taylor has heaped praise on St. Petersburg as “a city that cares a great deal about journalism,” citing the presence of the unique arrangement that allows the dominant daily newspaper, the Tampa Bay Times, to be owned by a nonprofit, the Poynter Institute.

The two publications also happen to be headquartered in the same building in downtown St. Pete. So it comes as little surprise that Taylor’s rapidly growing digital media

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GROCERY GAMES

JAY HEATER

Sarasota Bradenton International Airport President and CEO RICK PICCOLO. Gorda Airport in Charlotte County is like Save-A-Lot. As for Sarasota Bradenton International Airport? He says it’s like Whole Foods. So it’s a generalist, a discounter and an high-end option. Here’s to some kale and kombucha on that next flight from SRQ.

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It’s the country club of airports. At least that’s what the head of the airport says. During a recent luncheon about the future of air travel in the region, hosted by the Lakewood Ranch Business Alliance and the Greater Sarasota Chamber of Commerce, Sarasota Bradenton International Airport President and CEO Rick Piccolo told attendees SRQ is a different kind of airport. That’s because, he says, the airport has more of a “boutique, resorty, country club feel.” Piccolo later took his country club description a step (or several) further. He shared an unusual analogy that illustrated the way he likes to compare area airports to grocery store chains. Tampa International Airport, he says, is like Publix. The Punta

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Goodbye Minnesota winters, hello Southwest Florida. That’s one unavoidable sun-kissed truth to a recent corporate relocation news announcement. The company, Newcastle Aviation, which specializes in aviation parts commerce and logistics, decided to move its corporate headquarters from Burnsville, Minn., a suburb of Minneapolis/St. Paul, to Fort Myers. A global company that supports the commercial airline, regional airline and general aviation industries, Newcastle is building a 40,000-squarefoot facility at the Southwest Florida International Airport. Construction for the new headquarters, on Domestic Avenue off Alico Road, west of Interstate 75, is underway and expected to be complete by January. In total, the company plans to invest at least $2.59 million in the new headquarters project. But it’s not just weather that keyed Newcastle’s desire for a, um, new castle. For one, Florida and Lee County will provide $60,000 in jobs performancebased incentives for the move. The company, for the $60,000, is required to create 12 jobs within three years and follow through with the planned multimillion-dollar investment. Those new jobs new will pay an average of $56,325, including those moving with

4 topstories from BusinessObserverFL.com

BUSINESS OBSERVER | AUGUST 3, 2018 - AUGUST 9, 2018

BusinessObserverFL.com

SARASOTA-MANATEE

Manufacturer buys window business Window and door manufacturer PGT Innovations will acquire Western Window Systems from PWP Growth Equity for $360 million in cash. According to a release, the acquisition will allow Venicebased PGT to expand its product portfolio in the premium and contemporary indoor/ outdoor window and door category and to expand into new geographic markets. PGT expects to gain a platform throughout the Western U.S., including California, Texas, Arizona, Nevada, Colorado, Oregon, Washington and Hawaii with the purchase, the release adds. Western Window Systems has sales in 40 states.

quote of theweek I was pretty ignorant when I started the company and didn’t have a vision. Andrew Watson | Built, Tampa

Construction begins on cancer center

SEE PAGE 8

Florida Cancer Specialists & Research Institute recently started construction on a comprehensive cancer center in Lakewood Ranch, in east Manatee County. The $16 million cancer

what do you think?

center is scheduled to be completed in summer 2019, according to a release. Officials say the facility will allow patients to receive a variety of services and treatments under one roof, including chemotherapy, national clinical trials, physician visits and laboratory services. CHARLOTTE-LEE-COLLIER

Broadcast firm acquires station Naples-based Beasley Broadcast Group Inc., a large- and mid-size market radio broadcaster, has agreed to acquire WXTU-FM in Philadelphia from Entercom Communications Corp. Beasley will pay $38 million in cash for the station, according to a statement. Beasley intends to fund the acquisition through borrowings from loans and cash generated from operations. The acquisition augment’s Beasley’s presence in the Philadelphia market, where it owns six other radio stations and digital operations, according to the statement. It is the ninth-largest market in the country.

Airport passenger traffic posts increase More passengers on fewer flights are traveling in and out of Southwest Florida International Airport in Fort Myers. Passenger count in June was a record-setting 546,159 for the month, representing an increase of 3.4% over June 2017, according to a statement. At 5.5 million, year-todate passenger traffic is up 5.2% over the same period last year. That increase comes despite a continuing trend of fewer aircraft operations at the airport, which had 4,850 arrivals and departures in June, a 6.3% decrease compared to June 2017, the release adds. TAMPA BAY

School launches doctoral program The upcoming fall 2019 semester will see the debut of the University of Tampa’s first doctoral program. The university will begin enrolling graduate students who want to pursue a doctor of nursing practice degree, according to a release. The

Is automation a long-term boost for manufacturing or a job killer? Vote at BusinessObserverFL.com

program will prepare DNP students to design, implement and evaluate evidence-based disease management care and to coordinate acute and chronic illness care for individuals and populations. The program is targeted at advanced practice registered nurses living in Florida.

Hotel completes renovation project The Beach House Suites by The Don CeSar, sister property of The Don CeSar hotel on St. Pete Beach, recently completed a renovation project. The cost of the project wasn’t disclosed. The renovation includes upgrades to the lobby and the meeting rooms, according to a statement. The project is also the debut of newly redesigned public spaces, composed of a living room-like library; pantry stocked with sundries and grab and go refreshments; and a beverage station, the release adds. The 70-room all-suite beachfront property is half a mile down the beach from The Don CeSar.

44% Good 56% Bad

Last week’s question:

Will Trump’s criticism of the Fed be good or bad for the economy?

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AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

BusinessObserverFL.com

CoffeeTalk

FROM PAGE 3

company — which had $37 million in revenue in 2017, up 83% from $20.5 million in 2016 — would seek to forge a partnership with the Times. “Having those connections is important to us,” he says. The Times-Penny Hoarder alliance kicked off July 29, with the debut of the “Dear Penny” personal finance advice column in the print paper’s Sunday business section. Written by personal finance expert Lisa Rowan, the Q&A-style column began appearing earlier this year on the Penny Hoarder website. The arrangement with the Times represents the company’s first foray into print media.

Aligning with the Penny Hoarder and its younger demographics could be seen as a move from the Times to reel in millennial and Gen X readers who have largely abandoned print media. If nothing else, it’s a way to deliver new takes on a popular, evergreen topic — and boost its “cool factor” in the eyes of advertisers. “We’re looking forward to giving our readers a fresh voice and new perspective on personal finance issues and saving money, which we know is very important to them,” states Times Managing Editor Jennifer Orsi in a press release.

I N T H E H E A RT OF WAT E R SI DE

Rare chance to own a star Pinellas County has put a 96-acre, light-industrial office park that’s home to a top military contractor up for sale. The county’s request for bids for the site, the Young-Rainey Science Technology and Research (STAR) Center, represents what officials call a rare commercial real estate opportunity. According to a press release, the majority of the STAR Center, 7887 Bryan Dairy Road in Largo, is leased to defense contractor Raytheon. HIT Promotional Products, Constellation Technology Corp. and Compass Group USA also lease space there. According to a 2015 appraisal by Valbridge Property Advisors, the parcel is valued at $19.09 million. Some 81% of its 661,697 square feet of space is occupied, with the lion’s share of occupancy — 76.3% — attributed to Raytheon. Mike Meidel, director of Pinellas County’s Economic Development department, tells Coffee Talk the county

A V I BR A N T V I L L AGE CE N T E R

is “unlikely” to get $19 million for the property, but that it should be able to get well over $10 million. “Because the major tenant is Raytheon,” he says, “there’s not a lot of opportunity to increase revenue, but it’s safe money coming from Raytheon and the land leases, and there’s land available to do more. Plus, there’s a lot of surface parking that could be converted to structural parking.” A rent summary issued by the county June 1 shows the entire parcel generates $355,079.98 in annual rental income. About 10.5 acres are available for immediate development, according to the release. Meidel says the county is using a request for negotiation process (RFN) for the sale of the property because “we are not looking only at price, but

See COFFEE TALK page 6

now leasing Waterside Place will be a vibrant, lakefront town center and the heart of the new village of Waterside at Lakewood Ranch. Planned for boutiques and specialty retail, restaurants, and neighborhood-oriented professional services, Waterside Place offers 100,000 square feet of in-line and free-standing commercial space, as well as ample office space for lease.

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FROM PAGE 5

datasnapshot Top 10 Fastest Growing Luxury Markets

what [a potential buyer] would do with it.” Qualified responses to the RFN, he adds, should demonstrate how they will use the property to create jobs or “catalyst projects” that empower startups and entrepreneurs.

The deadline for submitting written questions about the opportunity and requesting a tour of the property is Oct. 1, and the deadline for bids is Oct. 11. More information is at PCED.org/ StarCenter.

9. Snohomish, WA (Everett), Ç12.7% 4. King, WA (Seattle), Ç13.7% 10. San Mateo, CA (Redwood City), Ç12.3%

7. Boulder, CO, Ç12.8%

6. Santa Clara, CA (San Jose), Ç13.1% 8. Santa Cruz, CA, Ç12.7% 5. Monterey, CA (Salinas), Ç13.2%

In June, 13 new machinists graduated from Sarasota County’s Precision Machining Program at Suncoast Technical College

Program churns out graduates This program is a machine at producing graduates. In June, 13 new machinists graduated from Sarasota County’s Precision Machining Program at Suncoast Technical College. It’s the fifth year of the program and in total, with June’s graduates, 102 workers have been trained through it. According to a press release, the program also led Florida in National Institute of Metalworking Skills manufacturing certifications, with 358 completed and a 96% job placement rate. Sarasota County provided funding for the program’s equipment. CareerEdge Funders Collaborative supported the program with $25,000 and funding for internships. CareerEdge is a partnership between businesses, government and

organizations to help build opportunities in the workforce in Manatee and Sarasota counties. Instructor Edward Doherty runs the year-long program. The next class will start Aug. 13 with 18 machinists. STC will also offer an Advanced Manufacturing Program for graduates. “This program has allowed us to establish a pipeline of workers that start in entry-level positions and then continue to up-skill and move up in a career with huge growth potential,” says Sarasota-Manatee Manufacturers Association Board President and PGT Industries Production Control Manager Bayne Beecher in the statement. “It is an achievement to have these skilled workers available in our community.”

3. Queens, NY, Ç15.9%

1. Sarasota, Ç19.7%

2. Collier (Naples), Ç15.9% REALTOR.COM

Luxury list Some distinct pockets of Southwest Florida are known for residents who live in the lap of luxury. The latest proof: a new report from Realtor.com that ranks the fastest-growing luxury markets in the U.S. It has two area Florida counties atop the list — Sarasota County at No. 1 and Collier County, home to Naples, at No. 2. “This month,” the report states, “Florida accounted for the top two fastest growing luxury counties, suggesting the inflow of demand for luxury properties remains strong.” Those areas were the only Florida counties on the top 10. The list was rounded out by counties in New York, Washington, California and Colorado.

The June report says overall home sales at $1 million and above are up 25%. A statement about the report says the index analyzes the entrylevel luxury tier — the top 5% of residential sales, in 91 U.S. counties. In those counties, the entrylevel price increased an average of 4.6% year-over-year. In Sarasota and Naples, the increase was much greater. Sarasota experienced a 19.7% change, while Collier posted a 15.9% change. In Sarasota, luxury prices (the top 5% of sales) have reached $1 million for the first time. In Collier it’s higher — $1,674,000. For both areas combined, the report shows, the median number of days on the market for luxury properties is 143 days. That’s down 22% year-overyear on average.

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AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

BusinessObserverFL.com

MADE ON THE

GULF COAST

Made in the Shade Companies that manufacture stuff in Florida have some core challenges to solve. Top of the list: Labor shortage.

n both a national level a nd w it h i n Florida, manufacturing is on the rise — in multiple metrics. Nationally, for example, the average industry annual sales growth per company and average net profit margins per company are on five-year high marks, according to data firm Sageworks. On sales, the average growth is 10% in fiscal 2018, up from 4.2% in 2017, Raleigh, N.C.-based Sageworks reports. The average net profit margin is 5.6% — the first time since 2014 it surpassed 5%. In Florida, meanwhile, there are 20,000 manufacturing businesses that account for nearly 5% of the state’s GDP, according to 2017 Florida Department of Economic Opportunity data. The industry is mostly a smallbusiness game, with 80% of the manufacturers in the state having 20 or fewer employees. Compared to other industries in the state, say professional business ser v ices or health care, manufacturing is low in total employees. But with an annual average wage of $57,884, the industry is No. 3 statewide in salaries per industry, according to the DEO. Another look at the industry, from a Federal Reserve Bank of St. Louis Economic Research blog post, is more nuanced. “Is manufacturing up or down?” asks the post. “As economists like to say, it depends.” To the good, manufacturing output is up steadily since the big recession-induced drop in 2010. Not yet 2007 output, data show, but close. “This production is accomplished, however, with fewer and fewer employees,” the post states, given “increasing productivity per employee” through innovation. In short: Manufacturers are making more stuff and using fewer people to do it. But if manufacturers had more people, they would be able to make more stuff. A trio of area manu-

facturing officials recently addressed that conundrum and other issues the sector grapples with. Edited excerpts: How have changes in technology, such as robotics, impacted manufacturers? Neil Kagan, executive director of the Southwest Regional Manufacturers Association in Fort Myers, says he’d like to see companies in the region adapt to technology with more urgency. “More companies need to keep up,” Kagan says. “If you can make 100 of something much easier, that gives you more opportunities to sell more things and do more business.” Sarasota Manatee Manufacturers Association Executive Director Peter Straw says automation is a good way to compensate for a workforce shortage. “Automation in robotics reduces the need for as many people on the floor,” says Straw, “but it increases the demand for people who are more highly

skilled and therefore more highly compensated.” How has the tight labor market impacted manufacturers? What are some creative hiring solutions companies have undertaken? Roy Sweatman, president of Southern Manufacturing Technologies in Tampa and a Bay Area Manufacturers Association board member, says the lack of talent in the region “has been horrible.” Adds Sweatman, whose 110-employee company did $14 million in sales last year, mostly in aerospace parts: “We’ve had to turn away a lot of potential work because we don’t have the people here to do it.” A lack of workers is a regionwide issue. Kagan says he mentioned a local company’s need for two computer-numeric controlled machinists at a recent meeting, and he was met with chuckles. “One board member said, ‘Good luck with that,’” Kagan recalls. Nearly every community on

the west coast of the state has myriad programs, from high school to community colleges and trade schools, say the officials. Apprenticeships also help. One challenge in drumming up interest and participation, says Sweatman, is apathy. “We have to fight the perception that people think manufacturing is all done in China,” says Sweatman. Straw says its key for manufacturers seeking employees is to ask, “What are we going to offer people to get their attention?” “We are now finding ourselves competing with Walmart and other companies for entrylevel employees,” says Straw. “Salary attracts people ... but long term what people look at is job satisfaction and the chance for advancement. That’s where manufacturing has a leg up over some of the other sectors.” Will the Trump administration’s trade war and tariffs have a positive or negative impact on manufacturers in the region? Sweatman says the negative fallout has already begun. His company’s domestic suppliers of aluminum and steel have already raised prices, 10% to 20%, in response to tariffs. The catch is that to bid on the aerospace work, Southern Manufacturing Technologies is required to buy American. “It’s either that,” says Sweatman, “or you don’t get any materials.” Straw is a bit more pragmatic, saying the long-term goal of tariffs should override the short-term pain. “It's long overdue,” Straw says. “We have said for years, American manufacturers can compete with anyone on a level playing field.” — Mark Gordon, Grier Ferguson

MARK WEMPLE

American Torch Tip is a third-generation manufacturer now based in southern Manatee County. Clients include auto manufacturers and others connected to auto parts. JACK WALTERS, right, is the president of the company.

The following five stories offer a glimpse into how a wide variety of manufactures in the region, from bread to handbags, overcome a litany of challenges. PAGES 8 THROUGH 15

BY THE NUMBERS Average Annual Wages by Industry

Florida Manufacturing Employment

$80,000

550,000 jobs

Florida, 2016

$60,000 $40,000

January 1990 to April 2018, seasonally adjusted Through April, there were 375,000 manufacturing jobs in Florida, up 12,300 jobs year-over-year.

500,000

$57,884 ALL INDUSTRIES

$20,000

450,000 400,000

Transportation equipment: 42,100 Fabricated metal products: 41,400

Aerospace products & parts: 22,300 Chemicals: 21,200 Jan. ‘18

Jan. ‘14

Jan. ‘10

Jan. ‘06

Jan. ‘02

200,000

Jan. ‘98

250,000

Computer and electronic products: 43,100

Food: 31,900

Manufacturing has gained jobs year-overyear in Florida for 88 consecutive months after losing jobs year-over-year for more than four years before that. Jan. ‘94

300,000

Florida, 2017

Miscellaneous durable goods: 32,400

Jan. ‘90

Pr Fi In of na fo es nc rm sio na M ial atio l & a ac n bu nuf tivit Ed sin ac ies uc es tu at s s rin io er g n G Tr vic & o ad v h e ea rn es e, l m t tra h e s n ns po Co ervi t rta nst ce Na tio ru s tu n ct ra l r Ot & u ion es he ti o r lit Le urc ser ies isu es vic re & es & min ho in sp g ita lity

350,000

Manufacturing Employment by Sector

Printing & related support activities: 17,500 Paper: 8,500 SOURCE: FLORIDA DEPARTMENT OF ECONOMIC OPPORTUNITY

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ANDREW WATSON, below, who founded Tampa-based Built in 2012, makes furniture for a variety of commercial clients.

WELL BUILT

Having overcome a devastating flood and mishandled growth spurt, Built founder and lead designer Andrew Watson sees a much clearer path for his custom furniture company. BY BRIAN HARTZ TAMPA BAY EDITOR

ollege dropout Andrew Watson started Built in 2012 with “nothing — just credit cards and a table saw.” The Alaska native, now 32, moved to Tampa when he was in elementary school and envisioned for himself a career in architecture. Watson did custom woodwork, trim work, paneling and cabinetry at companies like Mesh, an architecture and fabrication company in St. Petersburg, before he launched Built, a custom furniture company based in Tampa. At first, he worked alone in an old warehouse with a dirt floor, where he churned out handcrafted tables, chairs, benches and other furnishings, made primarily of steel and thick slabs of natural wood. In 2014, everything changed for Watson when R icha rd Gonzmart, president of the Columbia Restaurant Group, approached Built with the task of furnishing Ulele, the group’s new restaurant on the Tampa riverfront. At the time, Watson had managed to sell a few of his custom tables, which can cost $5,000 or more, around town, and talk of his talent spread via word of mouth and social media. “It was a luck thing,” Watson

says. “I was in the right place at the right time, and Ulele was a big enough deal to grease the wheels.” That breakthrough led to rapid growth for Built, which moved into a 5,000-square-foot space a few blocks from the company’s current west Tampa headquarters. Then the company faced a major setback. “About six months after we got into that space, it flooded,” Watson says. “We had 30 inches of standing water in the shop … our machinery was underwater; we had finished jobs floating around … it was a huge shock. We had insurance but not flood insurance because it wasn’t in a flood zone. It was this freak thing that happened.” Watson turned to mentors like Gonzmart for counsel. “I was freaked out at the time,” he says, “but they told me, ‘No matter what happens, it’s not the end of the world; it’s not as bad as it seems. Just take a step back and learn as much as you can from the experience — you’re not going to die from this.” Watson says he earned his lifebusiness degree from the flood and its aftermath, as well as when, after moving into the company’s current space, he hired too many employees too quickly. “We went from a couple people

to 17 in nine months — our overhead skyrocketed,” he says. Watson made the tough decision to scale back to 10 employees — and settle for less revenue but larger profit margins. “We figured it out,” he says. “Now we know what to do.” By the end of the year, Watson aspires to have Built phase out of the custom millwork and cabinetry business to devote more resources to making its own branded line of residential and commercial furniture. The company will continue to make custom tables, chairs and other pieces it is known for, but producing a branded line will allow it to a play in a space where there’s much less competition and more opportunity to score commercial contracts. “The beauty of commercial jobs now is that people want what’s called ‘resimercial’ in the industry,” he says. “It’s a residential look in a commercial environment — the open workspaces, the communal tables, the case pieces that look a lot like a dresser or an entertainment cabinet. We’ll have premium finishes for things that are residential, and premium versions for commercial as well, but we’ll also have more readily available pieces for commercial use. It’s a strategic play, and we’re amped up for it.”

BIGGEST CHALLENGE Built founder Andrew Watson, below, says, “I was pretty ignorant when I started the company and didn’t have a vision. As the company grew, all these new things popped up: ‘How do you hire people? How do you fire people? How do you manage people and keep them happy? Is what you are doing good? Is it good for the community? How do you make sure it stays good?’ The people-management challenge is huge because it’s something you can never be prepared for unless you do it.”

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SWANKY SUCCESS

An unexpected series of events led Gretchen Bauer to a previously never-thought-of career transition. BIGGEST CHALLENGE

BY MARK GORDON | MANAGING EDITOR

Finding the right partners, from the leathers, to the metal pieces. BSwanky’s Gretchen Bauer, with never-settle standards, says “we are only as good as the last bag we put out.” Getting there, she says, has been trial and error, and lots of digging, looking and poking around. “We want the best materials,” Bauer says. “We’re not WalMart. We don’t want the cheapest.”

retchen Bauer is an unlikely novice manufacturing entrepreneur. She spent 20 years in interior design in suburban Philadelphia, working in some of the Main Line’s toniest mansions. “It was fabulous,” she says. “It was a great business. I never had to advertise.” Bauer moved to Sarasota in 2012. She didn’t know anyone and didn’t have a job. She instead sought to design a big life change. She soon got involved with the Sarasota charity event-planning scene. That led to a series of opportunities, including finding out, from an area painter and friend, about a struggling woman’s handbag manufacturer in San Antonio. Around the same time, Bauer read the popular Simon Sinek book “Start with Why,” which she says changed her life. Her new why was to help the handbag company. Bauer, 51, bought some machines and equipment for it, spending around $10,000. She helped redesign the handbags. Through a partnership with the previous owners, Bauer named the company BSwanky. “I didn’t have any background in manufacturing,” says Bauer, but she thought her fashion sense and entrepreneurial spirit would provide a boost. With logistics between Florida and Texas growing complicated, Bauer recently decided to move the business to Sarasota. Now, in a 2,400-square-foot flex office and manufacturing space, Bauer has embarked on an unusual mission: to manufacture high-end handbags. The plan is to have the facility up and run-

MARK WEMPLE

From left, YOSHUA TORROLVA, GRETCHEN BAUER, sitting, HEATHER ROEMBKE and DAVE SZCZEPANIUK are part of BSwanky, a Sarasota startup handbag manufacturer. Bauer founded the business. ning by September, with up to five new employees working on some $50,000 in new sewing and embroidery machines and cutting materials. The differentiator for BSwanky, Bauer says, is the bag easily transitions from backpack to shoulder strap. So it’s good for the weekend traveler or the boardroom. “I want to create something no one else has, something transformational,” says Bauer, “that has the quality of Louis Vuitton.” To get transformational, Bauer has a bag full of challenges, from sourcing materials to marketing and branding to

SKIN DEEP

hiring. She’s invested at least $250,000 of her money into BSwanky and could seek outside investors by the end this year. “As a startup you have to be willing to hear a lot of no’s,” says Bauer. “You have to keep putting yourself out there.” One of the yes’s came from David Szczepaniuk, a manufacturing consultant who previously held leadership posts in quality control with Tupperware Brands and Venice drinkware maker Tervis. Szczepaniuk is working with Bauer on the factory setup. “I understand what it takes,” he says. The manufacturing goal is to even-

Necessity forced Kristen Flaherty out of her comfort zone. Now she’s building a manufacturing business — one small batch at a time. BIGGEST CHALLENGE

BY ANDREW WARFIELD LEE-COLLIER EDITOR

With an affinity for science and chemistry, Kristen Flaharty easily transitioned into formulating skin care products. The challenge? She had no experience in starting and operating a manufacturing business. “There are lot of ups and down early on and you have to have the passion and perseverance to fight through some of the doubts you might have along the way,” she says of starting a business. “Staying true north is really important because there are so many things that can pull you in another direction that are just distractions.”

risten Flaharty doesn’t see herself as a salesperson. A doctor of pharmacy, she prefers compounding and creating products over marketing them. But as founder and owner of skin care product manufacturer Trilogy Labs in Fort Myers, she knows she’s the most qualified to build her own customer base. And so in addition to researching, formulating, blending and packaging highend skin care and makeup products, she is also, in purposefully gradual fashion, growing awareness among skin care professionals and private-label retailers. Founded in 2014, Trilogy Labs was a finalist in the 2018 Florida Sterling Council’s Manufacturing Business Excellence Awards. From its 2,500-squarefoot facility off Treeline Road, Flaharty and her team of four compound, test, package and ship 60 products across three primar y brands and custom blends, all in small batches. Flaharty identified small batch production as an unfilled niche in the skin care product industry. She got there because many retailers can’t sell quantities they are required to purchase from large manufacturers before they expire. Among the people in the lot was her husband, Dr. Patrick Flaharty, who owns Azul Cosmetic Surgery and Medical Spa in Fort Myers, Bonita Springs and Naples. Having little success in sourcing high-end skin care products in small quantities for her husband’s practice, Flaharty decided the best source would be herself. So in 2014, she left a 20-year

tually produce 100 handbags a day in Sarasota. The process includes shaping and cutting leather and assembling metal pieces for the bag to be able to switch between shoulder and backpack. Bauer has already found three employees from word of mouth — all of them have sewing experience. Another ongoing challenge is marketing to the right customer. The handbags start at $215, and the company is working on some other lines, including one made with python skins, which could be sold for $900 each. So far, sales are only online and in a few popup stores around Sarasota. Bauer projects the company will hit at least six figures in sales this year. “We don’t have the margins to go retail yet,” says Bauer. That makes BSwanky’s social media and SEO presence essential. BSwanky has two consultants working on that. More marketing comes from a friend from Bauer’s Philadelphia days, a reality TV show producer, who will do some video work for the company later this year. Bauer says some reps of celebrities have also reached out to get their clients a BSwanky bag — a marketing coup. Says Bauer: “We are starting to get a lot of buzz.”

JIMJETT.COM

KRISTEN FLAHARTY founded Trilogy Labs in 2014 in part to help her husband better source skin care products to retail at his cosmetic surgery practice. career in pharmaceutical consulting and made an asset purchase of a local company that supplied some products to Azul Cosmetic Surgery. That’s now Trilogy Labs. “We had looked at a number of manufacturers, and we ended up using five vendors to cobble his line together. It was OK, but it wasn’t perfect,” says Flaharty. “The packaging didn’t sync together. We couldn’t always get what we wanted because it wasn’t available, or if it was available to us we had to buy 10,000 or 20,000 units at a time, and he couldn’t sell that many before it would go bad.” The solution was to become his supplier — sensing her husband’s predica-

ment wasn’t unique. “It’s a good niche to be in as a smaller manufacturer because there are a lot of people who can’t buy a ton of product,” she says. She was right. Since the asset purchase, which included a small customer base, Trilogy Labs has increased sales 400% from baseline and has grown from 14 commercial clients to more than 50. End users of the products number in the tens of thousands, Flaharty says. The company became profitable in 2017. She declines to disclose specific revenue figures. The flagship product is the proprietary Azul SkinHealth line, sold at her

husband’s offices and online. Other products include ID Skin by Integraderm; Minerale, a line of mineral-based, natural makeup; and private label and custom products, which is her salesleading sector. Flaharty says her current production comfort level is a maximum of 5,000 units of any one product at a time. “We’ve been careful about taking on orders I know we can deliver,” says Flaharty. “Could we do 20,000? Yes, but we would have to stop everything else and be dedicated to that one thing, and I don’t believe that’s in our best interest.” Production, though, can be scaled up as demand grows.“We’re not even scratching the surface of what we can do at our facility,” Flaharty says. Building a successful business, Flaharty has learned, is similar to methods used to create her products. “Build the platform and then build on that foundation layer upon layer,” she says, “and pretty soon you look back and see you’ve really come a long way.”

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MARK WEMPLE

COPELAND MORE and his father, TONY MORE, pictured at the recently opened La Segunda Bakery Café in south Tampa. Copeland, 38, represents the fourth generation of the More family to own and operate La Segunda.

OVEN FRESH Founded in 1915, La Segunda Central Bakery in Tampa’s Ybor City has stood the test of time. Will expanding its reach dilute the brand or take it to new heights? BY BRIAN HARTZ TAMPA BAY EDITOR

roducing some 18,000 loaves per day, La Segunda Central Bakery is one of the world’s largest manufacturers of Cuban bread. Founded in 1915 in Y bor City, Tampa’s historic Cuban district, the company is now in the hands of a fourth-generation descendant of founder Juan More, an immigrant from Spain who fought in the Spanish-American War in Cuba and developed an affinity for the island’s unique, crusty bread. W holesale operations account for about 75% of the company’s revenue, says Copeland More, 38, who now runs La Segunda. The younger More took over from his father, Anthony More, who at 75 remains actively involved in the business. But “you can’t grow without risk,” says Copeland More, who has engineered a major strategy shift for the company into the retail bakery-café space.

Retail example one: on July 18, La Segunda Bakery Café opened for business at 4015 W. Kennedy Blvd., a high-traffic location in south Tampa that should make for an ideal lunch spot in the bustling Westshore business district. T he More s spent about $800,000 to open the bakery café and hired three new fulltime bakers along with 25 other employees to perform retail operations like running the coffee bar, taking food orders and cleaning. Copeland More is bullish on the café’s prospects, projecting it will generate $1.2 million to $1.6 million in revenue in its first year of business. Company officials decline discloses specific revenue figures for the business. More says he “wasn’t in love” with the prospective new location — which is right next to another lunch spot, The Metro Diner — at first, fearing it was too big. But having grown up in south Tampa, he was familiar with the local demograph-

ics and believed it would behoove La Segunda to make a move into the area. Not only is it a tactical effort to extend the brand, it’s also a long-term strategic initiative. “There’s more growth potential in a retail, fast-casual concept,” More says. “There are only so many restaurants in the world that have an actual Cuban sandwich on their menu.” FAMILY VALUES One of those restaurants is The Columbia — the oldest restaurant in Florida known for its iconic “1905” salad and Cuban sandw ich featuring freshly ba ked L a Seg u nda bread. Owned and operated for generations by the Gonzmart family, The Columbia has multiple locations, including Ybor City, around the Tampa Bay area as well as restaurants in Sarasota, St. Augustine and Orlando. La Segunda’s bread is also featured in other Gonzmart Restaurant Group properties, including Ulele in Tampa and

BIGGEST CHALLENGE Copeland More with La Segunda Bakery says one of the company’s toughest challenges is distribution between stores — logistics and production. “We’re pretty tight, at full capacity at our wholesale facility,” More says. “So what we really need is a new facility — that’s the long-term plan. If all things go right, five years from now we can have a facility that can handle more output from the wholesale side and then also the production for the pastries and retail side.”

EXECUTIVE SUMMARY Executive. Copeland More Industry. Food manufacturing Key. Iconic wholesale bread maker pivots to retail with new bakery cafe.

AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

Café Con Leche in Ybor City. The two companies and the families who run them have much in common. Like La Segunda, the Gonzmart Restaurant Group is operated by a fourth-generation scion, Richard Gonzmart, who refers to himself not as president or CEO but “caretaker” of the family business. “The More family and my family have been friends and business partners for more than 100 years, ever since the bakery opened in Ybor City in 1915,” says Gonzmart, 65. “We serve it at all seven of our Columbia restaurants. It’s a relationship that has made us both world famous.” More says the secret to La Segunda’s success can be found in the recipes and manufacturing methods it uses to ensure consistent quality of its products. The recipe for the bakery’s signature Cuban bread is “real simple,” says More, but the deliberately slow process, similar to how sourdough bread is made, is where La Segunda stands apart from the competition. “There are other bakeries who do it but they’ll try to cut a corner here and there, whereas our bread is really slow-developing — it takes a lot of time to make, and every loaf is rolled by hand,” he says. “The larger bakeries are going fully automated and for them, the slower the process is, the less money they make, so they want the bread in and out as fast as possible. We have to have at least eight to 10 hours to make it or

else it’s not going to have the right flavor.” La Segunda also separates itself from the pack by baking its Cuban bread the traditional way, with a fresh palmetto leaf placed across the top of the shaped dough to seal in the moisture before the loaves are hit with air from high-powered fans to harden the crust prior to baking. Customers who pick up a loaf to take home from the bakery are presented with a package neatly tied with the very same palmetto leaf used to perfect the bread. COMFORTABLE RISK Copeland More isn’t worried about diluting the La Segunda brand by branching out with new ventures. “There’s been a lot of thought and time put into this,” he says. “Of course, it’s a risk; opening any business is a risk, and the restaurant business is extremely risky as it is, but we feel we got lucky with this location, and we like the tenant mix; the ingress and egress is great, and the parking is sufficient.” The company plans to keep payroll costs down at the new bakery café by being open only for breakfast and lunch, and closing at 3 p.m. “We’re not a dinner spot,” says More. The family-friendly operating hours are being used as a recruiting tool, much like east Manatee County-baaed First Watch does with its locations, which all have similar breakfast-brunch-lunch hours. “You can come work here, get home and pick up your kids from

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school,” More says. “A lot of [the staff], through their feedback, they really appreciate it. They feel like it’s an added benefit. So we’re going to test it here and see what happens.” The Y bor manufacturing location, conversely, operates nearly 24/7 to keep up with wholesale demand. Of the 75 staff members there, 38 are bakers who work long, earlymorning hours — which makes finding and retaining talent a major challenge, More says. But those who make the cut find ways to keep their shifts interesting. “Some of the guys, they’re competitive,” More says. “One master baker, he’ll throw a good mix and his bread will be beautiful, and so the next master baker will ask him how he did it, and he may or may not tell him the whole truth. But for the most part, they do a real good job of helping each other, and we do try to standardize the processes and training.” More says some of the master bakers have been at La Segunda for most of their professional lives. That makes extracting and distilling their vast amounts of institutional knowledge another HR and training challenge to overcome, especially because the bread is now being produced in two locations. “Basically, our plant manager has conversations with [the master bakers] and translates” their knowledge “so we can translate it back to new people and say, ‘This is how we’re going to learn,’” More says. “But you

know, you can’t put everything on paper — a lot of it is just touch with these guys.” ISLAND TIME More says demand for Cuban bread has “gone way up” in recent years. “People want to be different, and restaurants want to have niche, specialty things, and the Cuban sandwich has become one of those things that has really opened up new markets.” Beef O’Brady’s, for example, is a large restaurant chain that carries a Cuban sandwich on its menu, and guess who supplies its Cuban bread? That’s right — La Segunda. To get its bread where it needs to go, More says the company works with major distributors like Sysco, Gordon Foods, US Foods and, closer to home, the Punta Gorda facility for Cheney Brothers. But whatever you do, don’t make the mistake of confusing a Tampa Cuban sandwich with a Miami Cuban. “Never, never,” says More when asked if he would consider expanding into south Florida. “We sell more bread in Alaska than we do Miami. It’s a different culture. There’s Tampa Cubans and then there’s Miami Cubans — it’s a giant battle, constantly. They have Miami-style Cuban bread, and they don’t put salami on their sandwiches. People come to our bakery from Miami and they get very upset because our offerings are different. They say, ‘This isn’t a Cuban bakery,’ and we say, ‘We’re not a Cuban bakery; we’re an Ybor bakery.’”

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PHOTOS BY LORI SAX

Braves Vice President of Florida Operations MIKE DUNN, Tandem Construction Senior Vice President BRIAN LEAVER and Fawley Bryant Architecture Project Manager KIRK BAUER look at plans for the Braves facility.

BRAVE THE ELEMENTS

The Atlanta Braves spring training facility under construction calls for hundreds of workers, pounds of steel and cubic yards of concrete. A sneak peek reveals progress made and challenges ahead before the team can play ball. BY GRIER FERGUSON STAFF WRITER

ext spring will mean a fresh start for the Atlanta Braves. But to get to fresh start, first the Braves, through a handful of partners and entities, are engaged in a massive and unique, one-time, $125 million made on the Gulf Coast manufacturing project: a brand new baseball stadium. The Major Leag ue baseball team is moving its spring training base from the ESPN Wide World of Sports Complex in Orlando to West Villages, a master-planned community in North Port, a south Sarasota County city. With the move, the

Braves will become the 10th Major League team, in what’s called the Grapefruit League, to hold spring training on the west coast of Florida, from Lakeland through Fort Myers. Unlike most other teams, this stadium is the rare one to be made from scratch. Braves Vice President of Florida Operations Mike Dunn says as other teams relocate from Centra l Florida, t he Nort h Port location will give them an edge — less time traveling. “Here we’re closer to the competition,” Dunn says. “Plus it’s a beautiful area.” The Braves aim to play their first game in North Port in March 2019. But to do that, construction on the team’s new

complex will have to be finished. That means the project team will have to keep plowing ahead — and keep dodging raindrops. A f t e r a n O c t o b e r 2 017 groundbreaking, foundation work started in December. Now about 40% of the project is complete, says Fawley Bryant Architecture Project Manager Kirk Bauer. Getting to that point has mea nt some si x-day work weeks and even, at times, seven-day weeks for some members of the team. Bauer says the project boils down to creating an entire 80-acre campus from a blank slate. In addition to the Braves, partners contributing to the

$125 million price tag include Mattamy Homes and the West Villages Improvement District. The state, city of North Port and Sarasota County are also funding parts of the project. Dunn says the facility, with practice fields, an observation tower and a clubhouse, will serve as a baseball-manufacturing complex for the team. “Every component of the Atlanta Braves will be produced here,” he says. For fans, meanwhile, the stadium has a 360-degree concourse walkway so all elements of the game are visible, Bauer says. The facility includes 6,200 fixed seats and 1,000 berm seats. The stadium will also have

EXECUTIVE SUMMARY Project. Atlanta Braves spring training stadium and facility. Industry. Construction Key. Outlast weather dealys.

AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

a grassy knoll and an outfield patio and bar area. “We want the experience for the fan to be overwhelming,” says Dunn. The goal? Dunn says it’s to get the fan to say, “Oh my gosh, there’s so much to see and do.” A plaza on the campus will be open regularly to the public, and fields will be available for use, too. “It’s more about bringing the community to this site,” Bauer says. “It’s not just a ballpark.” To build the complex, the team is using a large local workforce. Tandem Construction Senior Vice President Brian Leaver says that includes companies that have done good work in the past with the general contractor. “We’re working with partners we know,” he says, including Fawley Bryant and several subcontractors. “That’s why they’re here. We know they can perform.” Part of what makes the project interesting, Leaver says, is the variety of materials, including clay, rock and sand. “It’s a lot of fun,” he says. “You don’t get to build Major League fields or stadiums very often.” For Bauer, some of the excitement surrounding the new stadium has to do with tradition. When construction is done, it will become a place where traditions are born, he says, like children going to their first Atlanta Braves baseball game. “This will be the start of them being Braves fans.”

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BIGGEST CHALLENGE Summer storms present some signficant challenges at the Braves spring training construction site in North Port. “The biggest problem we’ve had lately is the rain,” says Fawley Bryant Architecture Project Manager Kirk Bauer. To make up for it, he says, “a lot of people have been working overtime.” Gray skies frequently threaten rain, and when lightning is involved, that means workers must stop and retreat until it has passed. Braves Vice President of Florida Operations Mike Dunn says, “We understand we’re at the mercy of Mother Nature.” In an internal report detailing construction progress and events during mid-July, officials write that lightning occurs daily around 2:30 p.m. and holds up work activities for up to twoand-a-half hours. Weather or not, the overall plan remains the same: fans in seats, players on the field and bats swinging in March 2019.

The inside of the stadium under construction.

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Particularly disturbing about the plunge in Facebook’s shares was the disclosure that several executives sold over $4 billion worth of stock since the Cambridge Analytica news hit the wires on March 17. Bloomberg.com cited a report by InsiderInsights.com which showed that Mark Zuckerberg, Facebook’s Founder and CEO, accounted for about 85% of these insider sales. The report noted that these massive insider sales from March 17 through July were nearly equal in dollar amount to the total insider sales for all of 2017!! In M&A news, we learned on July 12 that the Department of Justice will appeal the AT&T court victory allowing it to complete its acquisition of Time Warner. The deal closed on June 14 after US District Court Judge Richard Leon, on June 12, issued a decision that completely rejected the Justice Department’s case. A decision on the appeal is expected in early 2019 according to a report by Dow Jones. AT&T was disappointed by news of the appeal and found it ironic that the Justice Department did approve the sale of media properties by Fox to Disney on June 27.

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commercial real estate

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Alabama firm buys Fort Myers industrial asset A Birmingham, Ala.-based investment firm has purchased a vacant Fort Myers warehouse once K.L. leased to Sears, MCQUAID Roebuck & Co. and FedEx, where it plans to recast the property as a self-storage facility. Merchants Retail Partners Management LLC, which is led by a trio of executives formerly with Colonial Properties Trust, a $6 billion real estate investment trust, acquired the 92,164-squarefoot property in June for $6.4 million. It is expected that Merchants Retail Partners may also add additional space onto the 10.3-acre site, at 2670 Colonial Blvd. Constructed in 1974, the building has been vacant for much of the past year, following tenant FedEx’s departure for a 250,000-squarefoot build-to-suit elsewhere in Lee County. FedEx had occupied the property for roughly a decade. The deal also marks the largest industrial transaction thus far in 2018 in Lee County. Seller Monmouth Real Estate Investment Corp., an affiliate of New Jersey-based UMH Properties, was represented in the transaction by Lee & Associates|NaplesFort Myers’ Bob Johnston, Jerry Messonnier and Derek Bornhorst. Tom Woodyard of Woodyard & Associates negotiated on behalf of Merchants Retail Partners. “To replace the building would have cost every bit of the amount that they paid, and that would be for the building only,” Johnston says. “And the Colonial Boulevard corridor is really growing in terms of residential, so a self-storage project should do well in that location, if that’s the route they take.”

St. Pete Pier tenant roster came together in stages A handful of carefully selected retail operators are expected to breathe life into the city of St. Petersburg’s new Municipal Pier, which is slated to open in fall 2019. But the selection process was one that took more than a year of deliberation and analysis to procure a roster of tenants that would complement each other and draw the most patrons to the 26-acre attraction, city officials say. Doc Ford’s Rum Bar & Grille; a trio of offerings from upscale restaurant to rooftop bar and casual café from Teak LLC of St. Petersburg; Tampa Bay Watch Inc.; and United Park Service Inc., which will operate Gator Jim’s Tackle & Bait Shack, a gift shop featuring local art and other beach-related See COLUMN page 17

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The 254-room Margaritaville resort in Fort Myers, scheduled to open in early 2021, will be developed by TPI Hospitality and constructed by DeAngelis Diamond, of Naples.

Watchin’ the Sun Bake Margaritaville Holdings plans a pair of Gulf Coast hotels as part of a major brand expansion.

f current plans reach fruition, the Gulf Coast will be home to two new Margaritaville-branded hotels within the next three years — including one that will be the first of its kind. The hotels, part of the burgeoning empire inspired by songster Jimmy Buffett, will be located in Fort Myers Beach and Anna Maria Sound, where Margaritaville Holdings and Minto Communities are marketing an upscale marina residential development known as One Particular Harbour — named after another Buffett hit. Fort Myers-based TPI Hospitality will develop the planned Southwest Florida resort, slated to contain 254 rooms, a handful of food and beverage offerings including a 100-seat, glass-enclosed beachside restaurant, a store stocked with Margaritaville merchandise, an in-house spa and an expansive terrace feature for views of the Gulf of Mexico. The roughly $200 million resort is scheduled to open in early 2021, TPI officials say. “One of the advantages to developing a Margaritaville property is their marketing muscle,” says John Gucciardo, a company spokesman. “W hile there are other lodging properties underway or planned, they’re 20 miles inland, whereas we’re on a barrier island,” he says. “And we know, according to tourism bureau research, is that no matter where people stay when they visit Lee County, at some point they go the beach. Well, we have that locked

up. We consider hospitality development in downtown (Fort Myers) to be a good thing for us, because it will bring more people to the area overall. Ours is an entirely different venue.” In Bradenton, meanwhile, Floridays Development Co. will start work early next year on the first Compass by Margaritaville hotel on Anna Maria Sound. There, Floridays, which earlier this summer opened the 162-room Art Ovation hotel that is part of Marriott International’s esteemed Autograph Collection in downtown Sarasota, will develop a roughly 130-room, upscale select-service hotel. The hotel is expected to open around the end of 2019. Compass, planned to rise five floors and contain 83,000 square feet on 3 acres per Margaritaville’s prototype, will contain a welcome cabana, a happy hour cocktail lounge, “Margaritaville-designed bar and grille concept” and other features intended to “bring a taste of the outdoors inside” in a “casual-luxe” atmosphere, according to company material. “It’s really escapism,” says James Brearley, a Floridays project manager. “The brand says it’s OK to chill out and put your feet up and watch the sunset, which really appeals to people today. In my mind, Margaritaville is an extension of the boutique hotel popularity, and this is different than any other hotel brand out there. Margaritaville, really, is a state of mind.” Though the Manatee County Com-

For the leisure traveler, they appeal to someone looking for an experience, for a novelty.

Lou Plasencia | founder and CEO, The Plasencia Group pass will be the first built in the country, Margaritaville executives have high hopes that the brand will expand nationally. “Wit h our t remendous bra nd awareness and the owner-friendly design concept, we see a remarkable opportunity to rapidly grow the brand across the U.S., with shortterm target markets throughout the Southeast and Mid-Atlantic,” Rick Cunningham, Margaritaville Holdings’ vice president of hotel development, says in a statement. The launch of the pair of planned Gulf Coast hotels coincide w ith Margaritaville Holdings’ 20th anniversary, a milestone that company executives have used to further the brand’s overall penetration into consumer markets.

AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

Today, the company operates a dozen resorts in Florida, Tennessee, Mississippi, Louisiana and the Cayman Islands. In addition to Fort Myers and Anna Maria Sound, in Florida the company operates resorts or hotels in Pensacola Beach, Hollywood, Kissimmee and Key West. New resorts also are being planned in the Bahamas, Costa Rica, Nashville and New York City, where the company plans a 234-room destination just off Times Square, at 560 Seventh Ave. That 29-story project alone is expected to cost $300 million. It also has some 15 other projects in its development pipeline, according to company information released in late May in conjunction with the Compass on Anna Maria Sound unveiling. Additionally, Margaritaville Holdings operates four gaming venues, in Las Ve-

gas and elsewhere, and more than five dozen restaurants and bars. The company also licenses and sells apparel, shoes, home décor items, frozen foods, liquors and beer, among other items. The resort and hotel development, in turn, is expected to generate additional interest in the brand and serve as a repository and retail space for all things Buffett. Hotel experts say the company has been prudent in the way they’ve rolled out new projects and leveraged interest from both travelers and developers alike. “For the leisure traveler, they appeal to someone looking for an experience, for a novelty,” says Lou Plasencia, founder and CEO of The Plasencia Group, a Tampa-based lodging brokerage firm and consultancy. “But they also provide quite a bit of meeting space in their properties, which is a clever way to reach out to the business traveler and get group business,” Plasencia adds. “And from an investor and developer standpoint, their fee structure is significantly lower than what it requires to affiliate with one of the big brands like Hyatt, Marriott or Hilton. With Margaritaville, you’re not going to be paying huge franchise fees.” Margaritaville also appears willing to be flexible with particular properties to be in the locations it desires. In Fort Myers, for instance, TPI Hospitality will build its resort on two sides of Estero Boulevard, so guests can experience both a Gulf view and have a bayside experience — complete with the 22,000-square-foot “License To Chill Terrace.” The two components to the resort will be connected via a pedestrian bridge over Estero Boulevard, TPI Hospitality says in its early June announcement regarding the resort. “Our alignment with Margaritaville ensures this one-of-a-kind resort will perfectly embody the look, feel and charm of its island community,” says Tom Torgerson, TPI Hospitality’s chairman, in a statement. Plasencia, too, says the brand has tremendous upside going forward. “They have good financial backing, and investors seem to be very attracted to the message they’re selling, as are travelers,” he says. “I think they’re here to stay.” – K.L. McQuaid

transactions | DEEDS/MORTGAGES The following real estate transactions more than $1 million were filed in Charlotte, Collier, Hillsborough, Lee, Manatee, Pasco, Pinellas, Polk and Sarasota county courthouses. The information lists the seller, buyer, amount of sale, previous price and date, mortgage and lender, if available, address and book and page of the document. CHARLOTTE Buyer: REFAO LLC Seller: Kenneth, Berinda and Robert Levy Address: 1641 Tamiami Trail, Port Charlotte Property Type: Medical office building Price: $5,400,000 Previous Price: $1,300,000, August 1994 COLLIER Buyer: NNN Naples FL Owner LP Seller: PX Brooks Village LP Address: 12975 Collier Blvd., Naples Property Type: Community shopping center Price: $16,330,625 Previous Price: $13,804,900, February 2014

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COLUMN from page 16

ing the entire pier, from Beach Drive to the pier head.”

offerings and a café, have been selected to open at the St. Pete Pier when it debuts. “The public was very clear through their input on what they wanted at the Pier,” says Alan DeLisle, a city development administrator. “But the design came together sequentially.” DeLisle credits an analysis commercial real estate brokerage firm Colliers International did in the second half of last year for helping provide clarity in the process. “The work Colliers did was a tremendous roadmap for us,” DeLisle says. “We paid a great deal of attention to that blueprint, because it defined the types of restaurants and retail that would work best, their price points and other critical information.” Doc Ford and the other merchants, which signed 10-year leases for the St. Pete Pier space, will pay a base rent plus a percentage of sales to the city, which has set a $3.2 million annual operating budget for the attraction. The $80 million project is being designed by ASD and Rogers Partners Architects + Urban Designers. The previous pier, the fourth iteration of a St. Pete pier since its first one in 1889, closed in May 2013. Colliers involvement will continue, however. Under a contract with the city, the firm and Big City Events will organize and run a minimum of 78 events at the new pier during its first year in operation. “Colliers was so important to the process because we needed someone who could coordinate the overall and bring it all together,” DeLisle says. “And the events planned weren’t so much layered in, as they were the first thing we wanted to focus on. “It all comes back to activat-

Highwoods Preserve building comes to market Highwoods Properties is offering its Highwoods Preserve I office building in Tampa for sale for $39.52 million, according to online commercial real estate platform Loopnet. The six-story building is fully leased to Syniverse Technologies LLC, which uses the space as its global headquarters, according to the company’s website. Developed in 2000, the 8125 Highwoods Palm Way building is one of three offices the Raleigh, N.C.-based company owns in the 1.8 millionsquare-foot business park. The 198,750-square-foot building, which provides five parking spaces for every 1,000 square feet of rentable space, sits on 6.7 acres. Highwoods is selling the property through Stan Johnson Co., a Tulsa, Okla.-based commercial real estate brokerage firm. Johnson Co. officials did not respond to multiple requests for comment on the potential sale, and Highwoods executives in Tampa did not reply to an email inquiry about the property. Highwoods Preserve I is expected to trade at a 7.75% capitalization rate, or rate of return. Syniverse operates there on a triple net basis, according to Johnson Co. offering material. In all, the publicly traded Highwoods owns two dozen properties in the Tampa area, ranging from the SunTrust Financial Centre downtown to the Laser Spine Institute at Avion Park, according to its website. The company also has a pair of planned office buildings — Independence Two and Highwoods Bay Center II — that would contain a combined 358,000 square feet.

BY STEVEN BENNA | CONTRIBUTING WRITER

Seller: Timber Creek Development LLC Address: Tampa Property Type: Vacant land Price: $11,440,000 Buyer: H-Bay Ministries Inc. Seller: Brandon MC Investments LLC Address: 1819 Providence Ridge Blvd., Brandon Property Type: Assisted living facility Price: $10,455,000 Previous Price: $3,664,000, July 2005 Buyer: Lennar Homes LLC Seller: Highway 301 Investors LLC Address: Tampa Property Type: Vacant land Price: $6,743,411.31 LEE Buyer: Dani Dr 123 LLC Seller: DHBC LLC Address: 8445 Dani Drive, Fort Myers Property Type: Vacant commercial land Price: $2,418,886

Buyer: EKL Properties LLC Seller: Naples FL-W LLC Address: 7985 Airport Road N., Naples Property Type: Retail store Price: $5,860,000

Buyer: Trinity Enterprise Holdings Inc. Trustee Seller: Pri-Car III LLC Address: 20501 State Road 31, North Fort Myers Property Type: Agricultural land Price: $2,037,000

HILLSBOROUGH Buyer: Lennar Homes LLC

MANATEE Buyer: Sarasota Real Estate Holdings LLC

Seller: Waypoint Sarasota Owner LLC Address: 3415 Broadway Ave., Sarasota Property Type: Apartment units Price: $38,000,000 Previous Price: $4,350,000, October 2015 PASCO NONE PINELLAS Buyer: 2055 Palmetto Realty LLC Seller: 2055 Palmetto Street SPE LLC Address: 2055 Palmetto St., Clearwater Property Type: Nursing home Price: $14,185,750 Previous Price: $13,716,600, October 2015 Buyer: FL Tarpon Square HA LLC Seller: DDR Tarpon Square LLC Address: 905 E. Tarpon Ave., Tarpon Springs Property Type: Fast food restaurant Price: $13,200,000

Buyer: DMG Drive LLC Seller: Twelve Point Holdings LLC Address: DMG Drive, Lakeland Property Type: Commercial land Price: $1,145,000 Previous Price: $1,500,000, October 2007 Buyer: James Construction Group LLC Seller: Ringhaver Equipment Co. Address: 525Highway 640, Mulberry Property Type: Office building Price: $1,022,000 Previous Price: $260,000, September 1986 SARASOTA Buyer: 600 N Jackson Rd I LLC and 600 N Jackson Rd II LLC Seller: Richard and Colleen Devita Address: 600 N. Jackson Road, Venice Property Type: Agricultural land Price: $8,600,000 Previous Price: $3,200,000

Buyer: Lucky Clearwater LLC Seller: Rubin Automobile Boulevard LLC Address: 12900 46th St. N., Clearwater Property Type: Warehouse Price: $9,900,000

Buyer: 4240 S. Trail LLC Seller: Julevest LLC Address: 4238 S. Tamiami Trail, Venice Property Type: Office building Price: $2,202,900 Previous Price: $375,000, January 2000

POLK Buyer: Verde Investments Inc. Seller: DDrivetime Car Sales Company LLC Address: 1825 W. Memorial Blvd., Lakeland Property Type: Auto sales Price: $1,550,000

Buyer: Brotherhood Limited PTR LLC Seller: Sumterprice9 LLC Address: 4805 White Ibis Drive, North Port Property Type: Vacant commercial land Price: $2,124,770 Previous Price: $525,000, October 2017

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Sarasota-Bradenton International offering land for development New air traffic control tower opens up nearly 100 acres near runways.

COURTESY PHOTO

To ensure its future financial viability, Sarasota-Bradenton International Airport is offering 92 acres of land for development.

KEVIN MCQUAID | COMMERCIAL REAL ESTATE EDITOR

n the wake of its completion of a new $25 million air traffic control tower, Sarasota-Bradenton International Airport officials are offering nearly 100 acres of land adjacent to its runways for development. The land, within the Airside North Quad Commercial Park between a pair of runways, could be developed by air freight logistics, cargo, aviation maintenance or related firms, officials say. Corporate hangars and a fixedbase operator similar to the existing Dolphin Aviation or Rectrix Aviation also could be built on the property, airport officials say. “The land is within our infield and adjacent to our runways, and there are not a lot of facilities in the country that have that, so it’s really a rare commodity,” says Fredrick “Rick” Piccolo, the long-time president and CEO of the Sarasota-Bradenton Airport Authority, which runs the airport.

Piccolo, who attended a prestigious aviation trade show in London earlier this month to begin marketing the land, says the 92-acre tract could accommodate roughly 1 million square feet of industrial and commercial space. The proposed development on the land comes as the airport authority is working to diversify its sources of income and generate revenue from nonairline activity. In the past decade, airline consolidation has decreased passenger traffic at the airport, and the rise of discount carriers at airports to the north and south has also cut into the number of travelers choosing Sarasota-Bradenton International, which operates under the Federal Aviation Administration call letters SRQ. Today, seven carriers fly out of the airport, including Air Canada, Allegiant Air, American Airlines, Delta Air Lines, Elite Airways, Jet Blue and United Airlines. The airport serves roughly 1 million passengers annually — about the same level as Punta Gorda Airport in Charlotte County, which has a single

The idea is we’re trying to diversify our revenue streams so that we’re not quite so reliant on airline operations over the course of the next two decades. Rick Piccolo | SarasotaBradenton Airport Authority president and CEO

carrier, Allegiant — and a fraction of the travelers that fly into and out of Tampa International Airport roughly one hour’s drive away from SRQ. As a result of SRQ’s loss of legacy carriers such as Continental and discounters like Air Tran Airways in recent years, the airport straddling Sarasota and Manatee counties has been beefing up noncommercial carrier operations. “The idea is we’re trying to diversify our revenue streams so that we’re not quite so reliant on airline operations over the course of the next two decades,” Piccolo says. “Now, given the new parcel that’s become available, one with direct runway-accessible land, we think we’re taking a significant step toward broadening our future success.” The runway-accessible property represents the latest in a series of moves the authority has undertaken to bolster revenue. In 2000, the airport embarked on development of a new roughly 100acre industrial park on its 1,100-acre property. Today, about half of that acreage remains available for lease. The authority also has another 76acre tract slated for future development, Piccolo says. In all, the airport generates about $1.5 million a year from nonairline sources, including ground leases occupied by a self-storage facility, Honeywell offices and a 108-room Hampton Inn & Suites hotel, which was developed a decade ago by Sarasota-based Finergy Development LLC at the entrance to the airport at 975 University Parkway. The hotel was the first Hampton Inn globally to earn a LEED Silver certification and was the first Sarasota lodging property to be recognized as LEED energy efficient. That $1.5 million figure is up from $200,000 that was generated just a few years ago, Piccolo says. But with the new 128-foot-tall tower now operational — an official dedication is slated for September — airport officials have increasingly turned their attention toward future expansion by producing a YouTube video outlining future expansion and other materials. “We’re taking steps now to make sure the airport is economically healthy for at least the next 20 years,” Piccolo says. “The 92 acres being brought to market now are part of our long-range vision to ensure the viability of the airport.”

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RUB SHOULDERS: The Greater Tampa Chamber of Commerce is hosting its 2018 Political Hob Nob. At the event, guests can mingle with candidates who are vying to represent the Tampa Bay area. Attendees can also participate in a Hob Nob Straw Poll. The event is from 4:30 to 7 p.m. at the Tampa Convention Center, 333 S. Franklin St., Tampa. Tickets are $40 for members, $50 for non-members

and $60 at the door. To register, visit tampachamber.com. For more information, call 813-228-7777.

AUG. 17

SMALL BUT MIGHTY: The Manatee Chamber of Commerce will host the 2018 Manatee Small Business of the Year Awards. The breakfast event will include presenting awards that celebrate small businesses and nonprofits for customer service, employees,

events

growth and community support. The event is from 7:30 to 9:30 a.m. at the Manatee Performing Arts Center, 502 Third Ave. W., Bradenton. Tickets are $40. To register, visit manateechamber.com. For more information, call Erica Massey at 941-748-4842, ext. 123.

AUG. 25

THE HEIGHTS: The Greater Fort Myers Chamber of Commerce will host the

13th annual APEX Awards. The event is an annual tribute to a woman or an individual for professional excellence, community service and for assisting others in attaining professional goals and leadership skills. The event is from 6:30 to 10 p.m. at Hyatt Regency Coconut Point Resort and Spa, 5001 Coconut Road, Bonita Springs. Tickets are $150. To register, visit fortmyers. org. For more information, call Stephanie Davis at 239-332-2930, Ext. 213.

AUGUST 3, 2018 - AUGUST 9, 2018 | BUSINESS OBSERVER

myview |

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BY ADRIAN MOORE | CONTRIBUTING COLUMNIST

An end to poverty? It’s one idea, but paying for universal basic income is a big hurdle. One of the hottest ideas for what to do about poverty, at least in intellectual circles, is a universal basic income. It’s an old concept with some new twists, but the basic idea is the federal government would send everyone a regular check, regardless of how much they earn or their wealth. It would be like an idealized Social Security, a baseline amount for everyone to ensure a minimum standard of living. Proponents of a universal basic income argue that it would reduce poverty and income inequality by raising up those with the least, improve health by helping people stay healthier and afford health care, improve education attainment because people would not have to leave school early to work for food and shelter, and would give incomes to an increasing number of people working unpaid as caregivers for the young or old, especially women. They also say it would stimulate job growth with the spending by recipients of UBI, and would increase total national wealth. It is an untried idea. Attempts to test the idea have tended to fail or be abandoned due to changing politics, so we really don’t have a good pilot project to demonstrate how a UBI would work. Proponents point to Alaska as a kind of example, because the Alaska Permanent Fund distributes checks to all residents every year, paid for by revenue from the oil industry. They

Given that major reforms of welfare and assistance programs, or big tax hikes on the rich are rarely seen and politically difficult, paying for a UBI is a big hurdle. say this dramatically reduced income inequality in Alaska, and spending of those checks created more 10,000 jobs. At a national level, several estimates have found that a UBI providing each head of household $2,000 per month would cost nearly $2.5 trillion by 2025. Proponents say that could be paid for by eliminating existing welfare and assistance programs or raising taxes on the rich. But existing welfare and assistance programs at the federal, state and local level would only free up about one-third that amount. Given that major reforms of welfare and assistance programs, or big tax hikes on the rich are rarely seen and politically difficult, paying for a UBI is a big hurdle. And then there are the consequences of a UBI other than those benefits

touted by its proponents. Many point out that eliminating lots of targeted assistance programs, deliberately built over decades to help people with specific needs and replacing them with a check for everyone would help lots of people who don’t need it at the cost of people who do. And they point out it would eliminate programs that have learned how to help people rise out of poverty and succeed on their own. Economic models of UBI have found that it doesn’t end poverty, but changes who is poor relative to the current system. Perhaps more worrisome is the effect UBI might have on people’s willingness to work. A UBI would provide an unfettered income in return for simply being rather than help to overcome a specific challenge. While most people

Adrian Moore is vice president of Reason Foundation and lives in Sarasota.

want to work and get a lot of value in their lives from working beyond mere income, there are some who won’t work if they don’t have to. That is not good for the economy or them. Moreover, one big criticism of current assistance programs is that people who don’t need help but just don’t want to work are able to take advantage of the system. A UBI just sweeps that objection aside, which is bound to create a lot of resistance. Finally, many proponents of UBI point to the threat that automation and artificial intelligence will eliminate many jobs, and therefore a UBI is necessary to separate adequate income to live from having a job. But with the current unemployment rate around 4%, that problem is at least a ways in the future. Looking at the past few decades, the impact of increasing automation changes the types and distribution of jobs, but not really the total number of them. All in all, a UBI seems overwhelmingly problematic, and unlikely to solve the problems it targets. Modernity is built on exchange, starting with exchange of one’s labor — physical or mental. Our entire cultural and economic base would have to transform for a UBI to work without creating problems of unaffordable costs, disincentives to strive, create and help others, and even more conflict between doers and takers. Our energies would be much better spent trying to reform and improve outcomes from our current assistance programs.

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