Business observer 72817

J U LY 28 - AU G U S T 3 , 2017 | TH R E E D O LL A R S

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

Real Estate | A former McDonald’s franchisee flips to develop a new concept. PG.11 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

Sweet Home A real estate couple turns extra residential space into commercial success. PAGE 13

Valerie Wadsworth-DeLieto and Lee DeLieto Jr. SARASOTA, AIRBNB HOSTS COMMERCIAL REAL ESTATE

POLITICS

COMMERCIAL REAL ESTATE

Think Small

Let’s Get to Work

Branching Out

The tiny house movement may not only change how we live. It may also change how we vacation.

PAGE 9

A candidate for agriculture commissioner shares his experience putting people to work in the private sector.

PAGE 12

The Related Group shifts from condos in Miami to apartments in Tampa. The area’s job growth is the main attraction.

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COMMERCIAL REAL ESTATE

DEVELOPMENT

COMMERCIAL REAL ESTATE

After the Breakup

Meet the McFarlanes

One Burning Question

An urban developer planned on millennial buyers. Instead, he got a different demographic: divorcees.

PAGE 10

Five commercial real estate pros answer: What is the biggest change you’ve seen during this growth cycle?

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St. Petersburg’s Sirata Resort sells for $108.2M. 16 Liberty Group closes on first acquisition using its new fund. 16 Tampa’s University Club apartments sell for $41.7 million. 17

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3 The real solution for health care is a real free market.

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DON’T MISS

It takes confidence and teamwork to pull off big developments. For this trio, it’s done all in the family.

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BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BusinessObserverFL.com

Vol. XXI, No. 28

LOOKING FOR AN INVESTOR

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.

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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 243666

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JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

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review and comment

CoffeeTalk sponsored by Kerkering Barberio

BY MATT WALSH | EDITOR AND PUBLISHER

CONDUCTING BUSINESS WITH OUT - OF - STATE CUSTOMERS?

Blinded by altruism

Know the filing Requirements.

The Washington trajectory hasn’t changed in 75 years.

That’s why the final health law will remain costly and lousy. low, that sense of altruism in America overwhelmingly blinds reason: “The public thinks its essence — protection of the needy — is our highest moral duty.”

Perhaps it is. But here’s the mystery: Given the remarkable private charity of Americans, inexplicably they are willing to cede health care to a government that has failed miserably at assisting the poor.

Add to that the entitlements of Social Security, Medicare, prescription drugs, food stamps, Medicaid, etc. They are such embedded social institutions that when Sens. Rand Paul, Mike Lee and Ted Cruz talk of a capitalistic health care system, that is apostasy.

But there is another way — if only Americans and their representatives would be willing to be rational, not emotional. Consider the case that Jeffrey Tucker makes. He is director of content for the Foundation for Economic Education, a think tank that educates young people on individual freedom and free markets. Like Binswanger, he doesn’t blame Republicans, either, for failure to repeal Obamacare and come up with something better. Tucker writes on FEE’s website (fee.org): “Who or what is at fault? … There is only one underlying source of failure: the failure to understand. The root reason why Obamacare will last the current regime is intellectual.

“We should take it for granted that everyone in this debate wants more, better, cheaper health care for all. The intellectual failure is a lack of clarity about how to get there.

“A real free market in health care would provide affordable, high-quality health care for all, not as a matter of right, but rather as a matter of market logic.

“How do we know? Look at any market that is largely free. The impossibly brilliant and complex smartphone went from luxury to mainstream in a mere 10 years. The same is true for millions of services, from groceries to clothing to home appliances to software. The driving logic of competitive markets is to provide universal access.

“Even in other forms of health care that are free of government control, we see this trajectory. Pet care is affordable, universal and available at so many levels. Cosmetic surgery is the same. You can get nearly anything done to your body for less than the typical deductible of standard insurance. And consider free health care markets abroad: in a place like Lebanon, prices are one-tenth of the U.S. prices for great service.

“In today’s peer-to-peer economy, I can get a burrito delivered to my desk for $6, with no advance subscription service. I can get my groceries brought to my home for a small service fee. I have access to all the world’s informaSee COMMENT page 7

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• Do I have employees who telecommute or work from a home office that is located in another state?

• Do I install equipment or provide product repairs or maintenance at a customer’s location in another state?

If you answered “yes” to any of these, you may have multi-state filing requirements.

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wo things come to mind in the wake of the Republicans’ Obamacare fiasco: n No. 1: An American patriot who died four years ago at age 87 told me shortly before he left this world that in all of his adult life — consider that 70 years — nothing has changed in Washington, D.C., and with the federal government … nothing, no matter which party ruled.

In all that time, he said, the federal government has continued to grow; continued to intrude more and more into his and other people’s lives; and continued to take more of his money.

Make that almost 75 years. n No. 2: Why would anyone with a rational mind — and anyone who has witnessed the totality and modern history of the federal government — ever think that having Congress make rules for and the federal bureaucracy manage one-sixth of the nation’s economy is a good idea and would be successful? Or that they could do so better than the private sector. This is beyond comprehension.

Cynical and pessimistic as this may sound, it really doesn’t matter if the Republicans in the Senate and House ultimately agree on legislation that modifies Obamacare or repeals it. Nor does it matter if the final legislation includes that vaulted notion of bipartisan support, with some Democrats supporting it. It doesn’t matter.

Whatever they ultimately devise, it still will be lousy, wasteful and cost far more than it should. And it’s still going to take us another step closer to what the Democrats (and many Rhino Republicans, e.g. Sen. Susan Collins) ultimately want: 100% socialized, government-controlled health insurance and medical care.

Count on it. Because nothing in Washington ever changes the longterm trajectory toward an expanding Leviathan.

The only way it will reverse is if there are two unlikely changes — in the incentives that govern legislators’ behavior and/or if the majority of Americans had an intellectual epiphany and understood economics.

To the first: incentives. Senators and House members are rewarded (re-elected) for bestowing benefits (corporate subsidies; mandated health benefits; mortgage interest deductions; keeping unnecessary military bases open; ad infinitum). They are punished for taking benefits away.

What’s more, the takers and recipients of government largesse are the majority. And in a nation whose voters are split ideologically roughly 40%40%-20%, U.S. senators especially need large enough blocks of the 20% independent voters or the moderates on either side to win election. They especially cannot be perceived as insensitive and uncaring to the needy (e.g. mandated coverage for pre-existing conditions).

Indeed, as Ayn Rand associate and friend Harry Binswanger explains be-

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BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BusinessObserverFL.com

CHARLOTTE-LEE-COLLIER

Businessman heads to prison for fraud Port Charlotte businessman Casey Padula was sentenced to 57 months in federal prison for conspiring to commit tax and bank fraud.

Padula, 48, was the sole shareholder of marketing and information technology business Demandblox Inc., according to a statement from the U.S. Attorney’s office in Tampa. Padula conspired to move funds for his benefit from Demandblox to offshore accounts in Belize, depositing about $2.5 million, authorities contended. He used the funds to pay for personal expenses and purchase personal assets, officials add, falsely recording the payments in Demandblox’s corporate books as intellectual property rights or royalty fees.

quote of theweek It’s a fun business in the sense that all the customers are raving fans.

Jeremy Ricci | Tiny house developer SEE PAGE 9

Condo tower hits early milestone Mystique, a 20-story, high-rise luxury condo tower in Pelican Bay in Naples, recently surpassed a construction milestone: pile drilling.

The piles, each measuring 14 inches in diameter

what do you think?

and approximately 70 feet long, will serve as a vertical structural element of the foundation system that will support the building, according to a release. Miami-based Coastal Construction, general contractor for Mystique, is working with HJ Foundation, a Miami-based deep-foundation contractor specializing in augured cast-in-place piling.

SARASOTA-MANATEE

Longtime area lender joins new bank IberiaBank named area banker Michael Talerico vice president and business banking relationship manager for the SarasotaBradenton market.

Talerico, who has worked in commercial and business banking in the SarasotaBradenton area since 1990, will work closely with small to medium-sized business owners in his new role at IberiaBank, according to a statement. Banks Talerico has worked for include Bank of America, Cadence Bank, C1 Bank/Bank of the Ozarks and, most recently, Synovus Bank, where he was vice president of commercial banking in the Sarasota market.

How many years are left in this economic growth cycle?

Vote at BusinessObserverFL.com

College appoints nursing dean Roseanne Fairchild has been named dean of nursing and health professions at State College of Florida.

Fairchild joins SCF from Indiana State University, where she was the director of the nursing practice and graduate nursing administration, and was also an associate professor, according to a statement.

Fairchild, in coming to SCF, cited the nursing school’s reputation, student performance and student-centered learning and community engagement. “I really appreciate the college’s drive for excellence,” she says in the release.

TAMPA BAY

Manufacturer names CEO Tampa-based glass packaging manufacturer Anchor Glass Container Corp. named Nipesh Shah CEO. Shah will succeed Jim Fredlake, who is retiring. Shah was previously senior vice president and general manager for the consumer and industrial group at Consolidated Container Co. He also held senior positions at

Last week’s question:

Are corporate wellness programs a waste of time or a good benefit?

Momentive Specialty Chemicals Inc. from 2004 to 2014, according to a release.

Anchor Glass works with companies in the beer, liquor, food, beverage, ready-to-drink and consumer end markets.

It employs about 2,000 people and operates six manufacturing facilities in Florida, Georgia, Indiana, Minnesota, New York and Oklahoma.

Brewery finalist for national award St. Petersburg-based craft beer brewery 3 Daughters Brewing was named a finalist for the U.S. Chamber of Commerce Dream Big Small Business of the Year Awards.

Craft beer from 3 Daughters Brewing is sold at restaurants, bars and grocery stores in Florida, Georgia and the Bahamas, according to the company’s website. The brewery’s tasting room has more than 60 craft beer recipes on tap.

The small business awards celebrate the achievements of small businesses and honors small businesses’ contributions to America’s economic growth, according to a press release.

32% Waste of time 68% Good benefit

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JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

BusinessObserverFL.com

CoffeeTalk

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MIKE GEORGE media after the sale was announced.

“Our customers are very clear, and very forthright, and very loud, which is what we love about them,” sys George.

“They don’t want HSN to become QVC lite, and they don’t want QVC to become HSN lite. They don’t want either of us to become Amazon lite. We got to be who we are, just be better.”

George, returning to the joy theme, noted the company’s ability to be a retail therapy outlet for customers.

“We’re in the business of inspiring people. We’re in the business of curating amazing discoveries that help people’s lives, that bring them joy, that bring them entertainment,” says George. “It’s a wonderful thing to do, and I think it’s an important thing to do. We offer a kind of respite from political cycles, and news headlines, and negative press, and all the things that are out there that cloud our lives, and that’s a really wonderful thing to do every day.”

n Working on a 14,000-square-foot single-story facility for Summit Church in Fort Myers. The nearly $2 million project involves masonry block construction and includes the creation of a large foyer, worship area and a large stage; n Working on a construction management/design build renovation of the Sterling Oaks Clubhouse in Naples. n Working on a build-out of a 19,900-square-foot office space for Gartner, one of the largest employers in Southwest Florida. Scheduled for completion in August, the project includes the selective demolition of existing tenant spaces to accommodate a larger space; and n Chosen to lead a construction management/design and build project for Southport Truck Group’s new commercial truck dealership in Fort Myers.

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40 UNDER 40: ACT NOW The Business Observer is on a mission to find the region’s top up-and coming young professionals.

These are the people who light up the room when they enter it. That person everyone should know when they are new to town. That entrepreneur who risked money, reputation — many times both — for a vision, and succeeded despite the obstacles.

If this is you, or someone you know, then apply for the Business Observer’s annual “40 under 40” issue. The issue is open to entrepreneurs, executives and professionals

WAREHOUSE

Lakewood Ranch Properties

Firm sees lots of work Fort Myers area developer William Price Jr. and his son Matt Price were on to something in 2015 when they thought the commercial real estate market was about to go on a tear.

That’s when they launched Seagate Development Group, along with some investor partners. Seagate bought more than 500,000 square feet of industrial and flex space in Southwest Florida. In addition, the company now has a diverse list projects — new construction and renovations. The list includes: n A recently completed a 15,000-square-foot interior build-out and exterior renovation for Emcyte Corp., a medical device manufacturer, packager and distributor. The $850,000 project included construction of a clean room to accommodate Emcyte’s injection molding operations for manufacturing syringes and other items that are vacuum-sealed packaged prior to shipping;

THE PLACE FOR SPACE

in any field or industry from Polk through Collier counties. The nominee must be under 40 up until the day the issue is published, Oct. 13.

Rules are simple. Just follow the link here: businessobserverfl. com/40under40. You will need the name, age, city of residence, contact information and a short biography of the nominee. You may nominate yourself. Questions? Send a note to Business Observer managing editor Mark Gordon at mgordon@businessobserverfl.com.

The deadline is Thursday Aug. 17.

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The $2.1 billion QVC-HSN acquisition isn’t only about economies of scale.

It’s also about finding space to reel in more customers in the pocket between e-commerce and brick-andmortar stores, says QVC President and CEO Mike George. That space, George added in a July 7 speech at HSN’s St. Petersburg headquarters, the day after the deal was announced, is open to a company that puts the fun back in shopping.

“Retail is going through this great crack up, right?” asks George, according to a transcript of the speech QVC filed with the Securities and Exchange Commission July 18. “More stores closing than at any point in our history. A few big, giant, global, scalebased players winning and growing.

Wonderful companies, monstrously efficient companies, but they practice a kind of joyless form of shopping. Efficient, effective, I shop those players, but not a lot of joy.

“And so what we believe in, together, what we share in common, is this belief that there’s a third way from brick-and-mortar, and from big scale e-commerce players. We believe that humanity still matters in shopping, that relationships matter, people matter, inspiration matters, joy matters, fun matters in shopping, and that’s a really special thing that we get to experience together. So we’re going to have a lot of fun with all of that.”

George talked about the future of the combined companies, admitting “that there will be some overlapping activities, there will be some headcount implications of that.”

He also says the end game of the merger has to be a better-together model — otherwise customers will bolt. Customers said as much on social

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BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BusinessObserverFL.com

CoffeeTalk

FROM PAGE 5

Latvala: Term limits the root of the ‘rough’ session “It was the least favorite of my 15 years in the Senate.”

So says State Sen. Jack Latvala, RPinellas, one of the deans of the Florida Senate speaking July 20 to a luncheon of the Argus Foundation in Sarasota.

Latvala delivered a litany of criticisms during his remarks — of the 2017 legislative session; legislators in general; how the Legislature operates; the battle over Visit Florida and Enterprise Florida; and, without naming him, House Speaker Richard Corcoran.

“What went wrong,” Latvala says, “started in 1992 when Florida voters approved term limits.”

Term limits have caused legislators to focus on climbing the political power ladder. “Lost in that is trying do what’s right for the state,” he says.

“What [term limits] have done is concentrated the power of the process into two people” — the speaker and Senate president. He pointed to the closed-door budget negotiations between Speaker Corcoran and Senate President Joe Negron as explicit evidence.

He says the speaker and president each have three close colleagues in their leadership circles — “and everyone else is irrelevant.”

Latvala told the audience he “wouldn’t mind” if the Constitution Revision Commission put a question on the statewide ballot repealing legislative term limits. He says he wants the Legislature to go back to the time when “one guy didn’t tell them what to do.”

On Speaker Corcoran’s efforts to

JACK LATVALA eliminate the funding for Enterprise Florida and Visit Florida, Latvala argued both organizations had been working. To eliminate Visit Florida, he says, “It was the dumbest thing I’d ever heard.”

Latvala also criticized lawmakers’ repeated efforts to weaken local governments’ home rule powers. “That was a troubling thing,” he says. And he spoke against the proposed constitutional amendment lawmakers voted to put on the 2018 ballot to increase the homestead exemption — a measure that, if passed, would reduce cities and counties’ operating revenues unless they raised taxes. “It’s going to raise the millage rate on rentals and commercial properties,” Latvala says.

Latvala is approaching his final session in the Senate before he reaches his eight-year term limit for the second time. “I love the Florida Senate,” he says. “I would stay there the rest of my life if I could.”

But Latvala also acknowledged before lunch he is considering running for governor.

datasnapshot Home away from home Florida plays a major role on a list of top summer vacation home markets, which isn’t much of a surprise.

The bigger surprise: One of the n 28.

Davenport metrics in the study, from Attom n 30. Dunedin Data Solutions, is comfortable summer temperatures. Yet the sweltering Sunshine State still managed to place 22 cities in top n 24. Sun City Center 40, with 11 of those 22 on the Gulf Coast.

Attom analyzed the most popular vacation home cities, where at least one in every 12 buyers looks for a second home. Then it ranked the cities in a combination of n 25. Venice several factors — air quality, low n 13. North Port crime, appreciating home values n 3. Port Charlotte n over the past five years and reason27. Englewood able home prices.

21. North Fort Myers Crossville, Tenn., topped the list. n Port Charlotte in Charlotte County, n 10. Cape Coral Top with a five-year home appreciation rate of 115%, was No. 3. summer Other Florida cities that made the vacation n 38. top 20 on the ranking were DeerBonita Springs home field Beach, Delray Beach, Beverly markets n 33. Naples Hills, Cape Coral, Satellite Beach, Fort Pierce, North Port, Lake Placid SOURCE: REALTYTRAC.COM and Palm Coast. North Fort Myers, Davenport in Polk County and Dunedin all made the top 30, and Fort Myers ranked No. 41.

Imagine how could Florida 25 and No. 27, respectively, on the would do if the summers weren’t list. The average summer temperastifling? (Of course, then Florida ture in Venice is 84.6 degrees, while wouldn’t be Florida.) it’s 83.7 degrees in Englewood. The Consider neighbors Venice, in city sandwiched between the two, south Sarasota County, and Engleat No. 26? It’s Bend, Ore. Average wood, in parts of Sarasota and north Charlotte County, ranked No. temperature: 64.4 degrees.

Why Wagner?

Because Experience Counts.

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Wagner Commercial, a division of Wagner Realty, is one of the oldest and largest independent, locally owned and operated real estate companies on the West Coast of Florida. Our team members are experienced in all types of commercial property and investments and dedicated to helping clients with their real estate needs.

JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

COMMENT from page 3

DON’T BLAME THE REPUBLICANS

BY HARRY BINSWANGER

tion in my pocket, most of it provided for free. But, at the same time, I and everyone else must pay exorbitant fees just to gain access to simple medicines to fix a sinus problem, and even then we risk being on the hook for more money than it would take to buy a nice car.

“The system is not working, but there is no mystery about what would fix it: an open and competitive market. The free market delivers prosperity to all. It would do the same with conventional health care. The evidence for this assertion is everywhere around us…”

Sadly, we reap what we sow.

We have conditioned our representatives to respond to the incentives that keep them in power. They love power. But power is an opioid. It prevents them from seeing that liberty, capitalism and rational selfishness have proven for centuries to be more effective — in cost, widespread positive results and especially for the poor — than altruism that comes from the force of law.

There’s no reason to be hopeful Washington will change. But we also can’t give up.

BusinessObserverFL.com

So, we see that they are not even going to try to repeal Obamacare …

The temptation is to say, “Those g---mn spineless Republicans.”

That is a mistake. The problem is not in the moral character of the representatives. They are our representatives, after all. They should not need a spine, only the desire to be re-elected.

And the electorate, as they read it, does not want to cut off the looting of the productive to fund the irresponsibility of the parasites. Or, as the public sees the situation, we must not strip away from the helpless that which is rightfully theirs, by virtue of their need.

And right there you see the power of ideas. Egoism holds that one is entitled to what one has earned. Altruism holds that one is entitled to what one needs.

Egoism holds that rightful ownership of a value comes from the act of creating it.

Altruism holds that rightful ownership of a value comes from the state of lacking it.

The altruistic theory of entitlement through need cuts the ground out from under the popular notion that the issue is whether or not charitable acts should be forced on us by law. But “charity” depends on a concept of “property,” and “property” depends on the concept of “ownership,” and “ownership” depends on the standard of morality.

On the altruist standard, the dispossessed, the disadvantaged, the dis-

tressed, the underprivileged, the havenots, the underclass, the downtrodden, the weak and helpless, the abilitychallenged, “the most vulnerable among us”— the needy, have been robbed. The goods which are theirs by right have somehow ended up in the hands of others. And not just in the hands of random others, but in the hands of the worst, most ruthless, most depraved, sociopaths: those who, absurdly imagining themselves to be autonomous and selfmade, claim that they did “build that,” flaunting their yachts, limos and private jets in the faces of their victims.

Adopt that altruist framework for the moment. Now imagine how you’d assess the idea that “altruism is fine, I’m only saying it must not be forced on us by government.” For an altruist, that’s the equivalent of hearing “Rights are fine, I’m only saying they must not be forced on criminals by government.”

That’s why Obamacare can’t be repealed. The public thinks its essence —protection of the needy — is our highest moral duty.

Those who are unwilling to denounce altruism and uphold rational selfishness have no hope of defending capitalism.

Harry Binswanger, Ph.D., is a member of the Ayn Rand Institute Board of Directors and teaches at ARI’s Objectivist Academic Center. This article appeared in the summer edition of The Objective Standard magazine.

There’s no reason to be hopeful Washington will change. But we also can’t give up.

7

calendar

of

events

AUG. 3

SENATOR’S PERSPECTIVE: The Manatee Chamber of Commerce will sponsor D.C. Perspective: What’s Happening on Capitol Hill, featuring U.S. Sen. Bill Nelson. Transportation funding, health care and taxes will be among the topics discussed at the luncheon. Registration begins at 11:30 a.m. and the lunch and program runs from 11:50 a.m. to 1:15 p.m. The event is at the Bradenton Country Club, 4646 Ninth Ave. W. Admission is $30 for Manatee Chamber and Young Professional members and $45 for non-members and guests. For more information, contact info@manateechamber.com

AUG. 8

EMERGING OPPORTUNITY: Hendry County Manager Charles Chapman will be the keynote speaker at the Real Estate Investment Society luncheon meeting. Chapman will talk about changing land use patterns and commercial development in Hendry County, which seeks to diversify its agricultural economy by developing the infrastructure and workforce to support private commercial and industrial development. The meeting begins at 11:45 a.m., in the Osprey Room at the Pelican Preserve Clubhouse on Treeline Avenue at Colonial Boulevard. Admission, which includes lunch, is $30 for REIS members, $40 for guests. For more information or to register go to reis-swfl.org or call Bev Larson at 239-281-1290.

941-923-0535 americanpropertygroup.com

1973 AND 1967 17TH ST., SARASOTA, FL

FOR LEASE

8520 S. TAMIAMI TRAIL, SARASOTA

Directly behind the Hob Nob restaurant on N. Washington Blvd and across from Wendy’s, this property is ideal for an investor or a user. Great income from the auto repair tenant and efficiency apartment. Owner will close his very profitable auto rental business, which leaves room for a new tenant or you. 1967 St. built in 2013 and 1973 17th St. updated in 2008.

Excellent Signage.

3 Exceptionally Attractive Office Spaces! Lease 1, 2 or all 3 contiguous Units = 5230 sf. 1065 sf is an open floor plan, bathroom w/shower and built in cabinets. 1285 sf includes a reception area, open area, 2 offices & conference room. Both units have a small kitchenette. 2880 sf was formerly a Dentist office (plumbing in the walls) but can be used for any type of office. Large waiting room, reception area. 7 offices, 2 bathrooms, file room, storage room & kitchen. Call for floor plans.

FOR LEASE

FOR LEASE

838, 846 & 880 S. TAMIAMI TRAIL, OSPREY

The traffic on the S. Tamiami Trail in Osprey has increased enormously. You have a captive audience, with most passing by twice a day. Free Advertising from Day One! Available currently are 1600 sf and 2200 sf retail or office spaces and 2400 sf of air conditioned warehouse space. All are contiguous and can be combined. Rents are Gross rates including water.

4956 AND 4951 RINGWOOD MEADOW DR.

Two office suites available in the Meadows Shopping Village, located among natural preserves and ponds. Step outside for lunch to picnic tables at the lake just outside your doorway. Located near Fruitville and Honore in one of the area’s most enduring Country Club Communities. Suite 4956 Bldg G is 2900 sf. Spacious offices and conference rooms, large reception area and an abundance of parking. Suite 4951 Bldg A is 800 sf with 3 offices, all have windows, and wood paneling for a very professional office appearance.

Marcia Cuttler Realtor 941-923-0535 AmericanPropertyGroup.com

246467

FOR SALE

8

BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

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infocus | commercial real estate |

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9

BY WENDY LYONS SUNSHINE | CONTRIBUTING WRITER

Small but Mighty A developer with eyes on a growing tourism market hopes to lead the way in a new real estate trend.

CASSIDY ALEXANDER

Real estate investor JEREMY RICCI is behind a project to bring tiny homes to a former trailer park near Siesta Key.

DYLAN COX

Developer Jeremy Ricci believes Tiny Siesta and several other tiny homes, near Siesta Key in Sarasota, represent a burgeoning real estate trend. The tiny homes on this property range in size from about 220 to 360 square feet, with some sleeping up to six.

W

hen the Sarasota real estate market crashed around 2008, Jeremy Ricci saw opportunity.

A resident of Bucks County, Pa., the real estate investor had vacationed in Sarasota and loved it. “The tough thing about Sarasota at the time was that there weren’t a lot of jobs,” says Ricci.

“So, from a builders’ perspective, how can we take advantage of the low prices, but still have people to rent from us?”

A trailer park for sale close to Stickney Point Road and U.S. 41, near Siesta Key, sparked the idea for vacation rentals.

Ricci figured that while the Sarasota economy was floundering at the time, property this close to the beach could attract out-of-state vacationers with money to spend. Ricci and his business partner, Phil Falcone, bought the property for a little less than $1 million.

But the partners didn’t want to own a trailer park. Instead, the most popular RVs, the duo learned, were tiny houses — transportable, miniature dwellings with the architecture and some of the amenities of full-size homes. In those small dwellings, Ricci has seized on a big opportunity to meet an untapped market need.

“All we did to tweak the business model was say, ‘Instead of customers renting the ground, why don’t we buy the RVs and rent people RVs?’” Ricci asks. “And, if we’re going to rent RVs, we might as well pick the one that’s most popular right now.”

Ricci and Falcone phased out mobile homes on the property and installed fully furnished tiny houses that range in size from about 220 to 360 square feet, with some sleeping up to six people. The tiny homes are built outside the region and shipped to Sarasota. A few are built in Amish country towns in Ohio, while others are from Utah and Wisconsin.

Ricci spends about $50,000 to $90,000 and up for each new tiny house.

Ricci estimates he and Falcone save about 15% on building costs by working with Amish builders, whose religious beliefs against social welfare exempt them from workers compensation insurance and social security.

Ricci and Falcone bought their first tiny home in 2012, and they expect to put in up to 13 units at that location of varying styles and design schemes. “It just worked out well. We rented it out, and then if there’s a week that we wanted to go down, and stay there, we could do that,” Ricci says. Visitors pay from $139 to $199 a night to stay at the units, Tiny Siesta. Says Ricci: “We’re still trying to tweak the numbers.”

Ricci originally envisioned an art gallery of tiny houses. Builders, however, showed little interest in that approach.

So Ricci shifted models, and now uses social media for marketing and spreading the word about the units. Instagram has worked the best, so far, and he’s exploring Facebook and other sites. “We just decided that we’re going to go all in with social media and really try to promote it,” Ricci says.

When renters fell in love with the tiny houses and wanted to buy one of their own, Ricci found another new income stream, in brokering tiny houses.

(He’s taken six orders for an investor so far, and three orders for personal use, among many inquiries.) Ricci has also been in discussions with an HGTV TV show called “Tiny Paradise” about the possibility of showcasing one of his designs on an episode.

“It’s a fun business in the sense that all the customers are raving fans,” says Ricci.

“It’s really gratifying to have customers that are just so enthusiastic and want to share what you have with other people.”

10 infocus | commercial real estate | BusinessObserverFL.com

BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BY JOHN HAUGHEY | CONTRIBUTING WRITER

MARK WEMPLE

MIKE BEDNARSKI and RYAN STUDZINSKI oversee three urban infill projects in downtown St. Petersburg for Tampa-based Icon Residential.

Fill it Up

A Tampa firm with a niche in urban projects has discovered a growing market — in areas some developers have traditionally avoided.

W

it h one dow ntow n St. Petersburg townhouse development sold out, and units in two more selling briskly in anticipation of being occupied by early 2019, Tampa-based Icon Residential may need to tweak its marketing strategy to target an unexpected clientele.

The new niche target: people with problematic marriages.

“The only demographic we didn’t foresee is the ton of divorcees,” Icon Residential Principal Mike Bednarski says. “Divorced empty-nesters are selling their homes in the suburbs and moving into walkable communities.

They may not be able to afford a luxury condo, so this is their next step.”

“We anticipated getting a lot of millennials and ended up with empty-nesters,” Icon Planning Director Brian Kiraly adds.

That’s fine with them. The bottom line is Icon’s strategy in building boutique-style townhouse developments that embrace New Urbanist design principles in revitalized downtowns is paying off in St. Petersburg. The 8-year-old company, which generated about $65 million in revenue in 2016, employs about 50 people in offices in Tampa, Atlanta and New York.

Bednarski says “there is more demand than the market is pro-

viding” in downtown St. Petersburg for townhouses priced between $300,000 and $515,000 that are also low-maintenance and within 5-10 minute walks of shopping, recreational amenities, nightlife and jobs.

In addition to location and moderate pricing, Kiraly says another draw for Icon’s townhouses is they are “fee-simple townhouses, not condominiums or apartments. The response has proven there is a demand for that.”

Icon’s developments are The Arlington St. Pete, a 40-unit, one-acre complex on Eighth Street North along Arlington Avenue North; The District on 9th, a 34-unit, four-story structure on one acre on the corner of Ninth Street North and Arlington North; and Uptown Kenwood, a 69-unit, three-story, three-acre community on 13th Avenue North.

Bednarski says The Arlington is sold out and occupied while construction on The District on 9th and Uptown Kenwood is underway. “We’re selling units as we speak,” he says.

Bednarski says Icon’s projects are “catalysts for the area” and part of a dynamic wave of development revitalizing downtown St. Petersburg since 2013. The townhouses are within walking distance of downtown’s EDGE

(Entertaining, Dining, Galleries & Shops, Etc.) District, which is flourishing with an eclectic array of newly opened sushi bars, coffee shops, restaurants, craft beer pubs, dance clubs, art galleries and office complexes.

In novat ive development spurs innovative development, Bednarski says. “Amenity proliferation: That’s why we wanted to build there,” he says.

Icon was founded in 2009, a partnership between Bednarski and two fellow principals — Peggy Tseung, a former investment banking analyst at JPMorgan Chase and Ryan Studzinski, an institutional broker who has developed more than $250 million in real estate in the Tampa Bay area.

In 2012, the trio established Broome Capital, a real estate development company with three subsidiaries that specialize in providing financing for distressed housing, urban development and infill self-storage investment entities. Icon has since added IGC Builders, its own general contractor firm, and Crestview Realty Group, to its in-house capacities to become “a full turn-key operation,” Bednarski says.

Icon’s first urban infill project was the Valencia at Rosemary Place in downtown Sarasota.

It has since built — or is build-

ing — 13 developments, including projects in Tampa, Orlando and Atlanta and the three in St. Petersburg. Kiraly says Icon is looking to expand to Charlotte, N.C. Bednarski says “the next wave of gentrification we’re looking at” includes possible sites in Tampa Heights, Seminole Heights, South Tampa and Sarasota’s Rosemary District.

He says only 5% of sites the company looks at meet Icon’s criteria — a five- to 10-minute walk from nightlife, retail and employment. “The difficulty is finding sites that work,” Kiraly says. “We wouldn’t do something like this in Pasco County.”

Since first proposing an urban infill project that “had people scratching their heads,” Bednarski has learned some valuable lessons in the niche.

“The barriers to entry are very high,” for one, he says. Prospective developers must have the financial resources and professional capacity to handle as much as possible in-house.

By evolving into a “vertically integrated” company with the inclusion of subsidiaries such as Broome Capital and Crestview Realty, he says, Icon can get things done faster and less expensively. “We now have enough scale to be our own general contractor,” Bednarski says.

JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

infocus | commercial real estate |

BusinessObserverFL.com

11

BY ALICIA CECCARELLI | CONTRIBUTING WRITER

JIM JETT.COM

TIM FREDERIC, co-developing a small retail plaza in Fort Myers, seeks to bring a local brewhouse to the region.

Burgers to Beers A loss of a business partner and mentor caused a McDonald’s franchisee to rethink his priorities. His new aim is to bring people together around beer.

T

im Frederic can’t recall a time in his life when McDonald’s wasn’t in the backdrop.

His father, Fred Frederic, started with McDonald’s in the Los Angeles area when the younger Frederic was born. “My birth announcement was on a Big Mac,” says Frederic, now 39.

“That’s not a joke.”

His parents relocated to Sanibel Island when Tim Frederic was 11. They started franchising with McDonald’s in the growing Cape Coral market in 1996.

In 2001, Tim Frederic partnered with his father. He helped expand the family holdings from three to nine McDonald’s locations and advanced to director of operations. “I always speak highly of McDonald’s,” he says. “It’s an awesome business, and I’ve built great relationships there.”

But after Fred Frederic died at 73 from cancer in 2015, Tim Frederic sought a change. He sold his interests in the family McDonald’s franchise opera-

tion. Now Frederic, along with childhood friend Jeff Burns, a Sanibel-Captiva developer, has a new project: A brewhouse concept that will function as a hub specifically for craft beers brewed in Fort Myers.

In June 2016, Frederic and Burns founded Marlins Property Holdings LLC and bought land in South Fort Myers at 5611-5631 Six Mile Commercial Court for $1.2 million. The plan for the site is to build a plaza with up to nine tenants, including the brewhouse, which the partners named Marlins Brewhouse.

Const r uct ion on t he 14,665-square-foot building began in March and could be completed by the fall. Frederic declined to comment on discussions with potential tenants or the estimated the cost of the project.

The Marlins Brewhouse concept features beers tapped from several Fort Myers breweries as well as what Frederic calls “snowbird favorites” — domes-

tics and craft beers in high-demand — and wine.

Frederic wants to incorporate tech elements into the brewhouse to engage with millennials. Ideas include a live camera feed to promote live music, a selfie picture area and a touchscreen menu system where patrons can click and learn about the breweries where their favorites originate with directions on how to get there. “It becomes a community based on locals,” says Frederic.

The upscale, modern fishhouse design includes a Southwest Floridian-inspired beer garden where patrons can sit at community tables to eat and drink. Frederic believes his Florida beer garden is a first in Southwest Florida. Says Frederic: “I have not seen anything like it.”

Marlin’s Brewhouse will offer a limited pub fare menu to complement the beer and wine, but Frederic says he wanted to find a restaurant brand to tie the two together. “I’m a restaurant guy. I

understand operations, people, marketing, but as far as actually creating a menu from scratch, I’m not a chef,” says Frederic.

Bu r n s a nd Fre der ic resea rched seven restaura nt brands, and ultimately decided on an eco-friendly Californiabased chain, Chronic Tacos.

“I wanted to bring something here that no one’s ever heard of,” says Frederic.

Chronic Taco’s has “a good online presence, great stories and the fit with our attitude of conservation,” says Frederic. A possible next move would be to duplicate the brewhouse concept in other brewery-dense cities such as Naples, Fort Lauderdale and Tampa, says Frederic.

Frederic says his father’s death turned out to be a tragic motivator. “At 50, I don’t think I would have had the guts to make this move,” Frederic says.

“At 39, I’m like, ‘If I’m going to do whatever, the time is now.’

I don’t want to look back regretting it. You’ve got one life to live.”

At 39, I’m like, ‘If I’m going to do whatever, the time is now.’ I don’t want to look back regretting it. You’ve got one life to live.

Tim Frederic | Marlins Property Holdings LLC, Fort Myers

12 infocus | entrepreneurs |

BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BusinessObserverFL.com

BY LIZ MORRISEY | CONTRIBUTING WRITER

CINDY SKOP

BAXTER TROUTMAN founded Winter Haven-based Labor Solutions in 1997.

WORK MAN Baxter Troutman’s business made it through the recession.

Now he’s angling for another gauntlet: politics.

T

he recession was especially painful for Baxter Troutman.

When it hit in 2008, he had to close seven branches of his employee recruitment company, Labor Solutions. He let go of 41 employees — more than 80% of the company’s payroll. “It was an economic drive-by shooting,” he says. “There were a lot of victims of the recession.”

But his company was not a casualty of the recession. It took four years to make a full recovery, says Troutman, 50, but the Winter Haven-based company survived, and is now 20 years old. How did Troutman do it? He went back to the fundamentals of business, from being more nimble to eyeing expenses more closely to diversifying revenue streams.

Labor Solutions helps place people in light industrial, construction, service and agriculture jobs. The company has placed more than 50,000 people in jobs in the past two decades.

“We take great pride in helping people get gainful employment,” says Troutman, a Polk County native and grandson of Florida citrus magnate and Florida icon Ben Hill Griffin Jr. (Troutman’s been in the spotlight before, too: A Repub-

lican, he served in the Florida House from 2002-2010 and recently announced plans to run for Florida Agricultural Commissioner.)

Bartow’s Peace River Citrus has used Labor Solutions since it opened 15 years ago. “They’ve helped from the beginning,” says Manuel Suco, Peace River’s human resources manager.

“They have good rates and find the employees we need. They have good customer service.”

What sets Labor Solutions apart? Troutman says it’s the company’s ability to be flexible and put together custom packages for clients.

At the height of the company’s growth, Labor Solutions had 10 offices and 47 employees. It now has four locations and 20 employees. Troutman says revenues are up 20% this year over 2016, though he declines to share specific sales figures.

In addition to getting back to business basics internally, Troutman says the nature of how business owners find employees has changed with the use of more technology. Labor Solutions also recently realized it needed to diversify its customer base. In 2016, for example, it opened a location in

Georgia to help meet the employment needs of the peanut, cotton and orange processing industries.

Troutman left the family agriculture business at 30 years old in the summer of 1997 to launch Labor Solutions. He seized an opportunity to help a developer find workers to build a large corrections facility. He quickly gained traction and placed 40 people in jobs.

“People were interested in the project and we could cast a wide net for workers,” he says.

Troutman built a good rapport with the developer and continued to help the company find labor. Within the first year, Labor Solutions opened offices in Sebring and Frostproof.

Then came the population boom of the early 2000s, and by 2007 Labor Solutions had 10 offices in Central Florida and went as far north and west as Tallahassee and Panama City.

Post-recession, the firm continued to survive, Troutman says, with a “cream of the crop” small crew. Previous clients eventually started calling with work — another big step that aided the company’s recovery.

“We came full circle back to where we started,” Troutman says.

AT A GLANCE Baxter Troutman Hometown: Lake Wales Businesses: Labor Solutions. Also is general manager of Dark Hammock Legacy Ranch and President of ChopN-Block Custom Meat Processing.

Onetime shareholder in Fort Myers agribusiness Alico.

Politics: Troutman, a Republican, served four terms in Florida House, District 66 in Polk County. Recently announced he will run for Florida agriculture commissioner.

Family: Grandfather is Florida citrus magnate Ben Hill Griffin Jr., namesake for the University of Florida’s football stadium. Cousins with former Republican Florida State Sen. J.D. Alexander and former Florida Secretary of State and U.S. Rep. Katherine Harris, who lives in Sarasota.

L abor Solut ion’s g row t h strategy is now regional. The company recently acquired a local competitor, AJ O’Neal & Associates, and Troutman would like to grow to 12-15 locations in Central Florida within 10 years. Troutman will also grow with the memories, and lessons of the downturn, fresh.

Says Troutman: “The tenacity of an individual is measured in difficult times.”

We take great pride in helping people get gainful employment.

Baxter Troutman | Labor Solutions

JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

REAL ESTATE

BusinessObserverFL.com

13

BY MARK GORDON | MANAGING EDITOR

PHOTOS BY LORI SAX

Sarasota residents VALERIE WADSWORTH-DELIETO and LEE DELIETO JR. have two units for nightly occupancy available on Airbnb. One is next to their house, and one is a new unit built behind their home.

Be Our Guest A real estate-focused couple has dipped into the hospitality side of the industry, with a customer-first approach.

S

arasota couple Valerie Wadsworth-DeLieto and Lee DeLieto Jr. have the traditional side of real estate covered: Wadsworth-DeLieto handles residential estate, while her husband is in commercial real estate. The duo, both with Sarasota-based Michael Saunders & Co., has a combined 30 years in the business.

W hile not giving up their day jobs, the couple has also recently invested in a second gig: hosting Airbnb properties.

The online hospitality marketplace, surging in popularity in the past few years, offers a wide range of places to stay, from boats to mother-in-lawsuites to full houses. Guests love it for the variety and convenience and because it’s not a hotel, while hosts have capitalized on the opportunity to earn extra money — many cases in something they already own.

DeLieto and Wadsworth-DeLieto have seized that opportunity and taken it a step fur-

ther, creating a pair of high-end Airbnb units with Ritz-Carltonlike touches, mints on the pillows and robes in the closets. “I always do my best to wow them and go above and beyond,” says Wadsworth-DeLieto.

The couple offers two properties on Airbnb. One, dubbed Sea Turtle Cottage, is a 350-squarefoot studio unit they own next door to their own house, on Sixth Street in Sarasota’s Gillespie Park neighborhood, just north of downtown. The other unit, the Mermaid & Corkscrews Loft, is a new-construction property, a 650-square-foot loft.

Led by Wadsworth-DeLieto, the couple hosted guests in the Sea Turtle Cottage since late 2015, while the Mermaid & Corkscrews Loft debuted on Airbnb in July. Getting into Airbnb isn’t a gateway drug to owning a bed-and-breakfast, the couple says, but more of an obvious use of land and space combined with zoning rights and the hospitality industry disruption Airbnb provides.

“It’s a lot more welcoming way to stay somewhere,” says

Amenities at the Mermaid & Corkscrews Loft include a fully equipped kitchen and a stone, tile and rain head shower.

Wadsworth-DeLieto, 44. “You can experience a whole community and it’s more personal this way.”

The couple has used Airbnb on the guest side for years, staying in ones when traveling to Montreal and Easton Pa., among other places. They had annual tenants in the smaller

cottage they own for a three years, up until they decided to give Airbnb a try in late 2015.

The Sea Turt le Cottage’s amenities include a front-load washer and dryer, internet TV and a queen size bed. There’s See AIRBNB page 19

EXECUTIVE SUMMARY Hosts. Valerie Wadsworth-DeLieto and Lee DeLieto Jr. Industry. Hospitality Key. Real estate brokers seek extra income with Airbnb.

14

BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BusinessObserverFL.com

COMMERCIAL REAL ESTATE

BY ALICIA CECCARELLI | CONTRIBUTING WRITER

JIMJETT.COM

The MacFarlane Group — BOB MACFARLANE, wtih wife, EMILIA MACFARLANE, left; REBEKAH MACFARLANE BARNEY and MARK MACFARLANE — has developed multiple projects in Fort Myers since the early 2000s.

Change on the Horizon

A close-knit family specializing in multimillion-dollar renovation projects has been building up the Fort Myers skyline for years. How do they keep it all together?

M

acFa rla ne Group CEO Bob MacFarlane has overseen resident ia l a nd commercial development projects since the 1970s. That gives him the experience to determine what projects will likely work, and which ones are a tad riskier.

“I refer to today’s developer as ‘El Burro,’” says MacFarlane.

“You pack him up with all kinds of responsibilities, load him up with debt, give him a slap on the fanny and he goes uphill. At the top, if the economy is good, the ‘burro’ gets dinner.”

The MacFarlane Group is a family affair and has had lots of good dinners over the years.

Bob MacFarlane’s son, Mark MacFarlane, brings the skills in construction management, while daughter Rebekah MacFarlane Barney’s expertise is in finance acquisition. Through their combined effort, the MacFarlanes, along with MacFarlane Group founding partner Oded Meltzer, have handled $2 billion in real estate transac-

tions, development, construction and renovations.

Since the early 2000s, the development focus has narrowed to downtown Fort Myers, starting with three luxury condo towers: the Beau Rivage, Riviera and St. Tropez, $150 million in projects completed in 2006. “We were fortunate to have just caught the market at a good time. With the Beau, nothing had been built on the river in 22 years,” says Bob MacFarlane.

During development of the Beau Rivage, Bob MacFarlane says officials with the Community Redevelopment Agency thought he was “nuts” for pursuing that project. “It was not that good of a neighborhood,” he remembers, stating that “people of the evening” were seen working the streets — even in midday.

One year later a fellow developer, billionaire Miami builder Jorge Perez, built a neighboring set of towers, The Oasis. Bob MacFarlane describes Perez as “a very bright, capable guy,” who built “a nicer set of buildings.”

Adds MacFarlane: “Unfortunately, he got hit with the down-

side of the recession.”

The MacFarlane Group now has two high-rise waterfront projects in Fort Myers in the works — one part of a large redevelopment underway across downtown. One MacFarlane Group project is Campo Felice, a $90 million, resort-style, highrise senior living community currently in its second stage of development. The other project, Prima Luce, is a two-tower, 22-story luxury condo community totaling 220 units. Condos in that project are listed in the $200,000 to $900,000 price range.

FAMILY DYNAMICS The three MacFarlanes partially attribute the long-term success of the firm to each one’s ability to play off each other’s strengths and weaknesses. Mark MacFarlane, for example, says few business partners can create a level of intimacy like theirs without spending decades together. “We know how each of us thinks, so we know what they would do in a situation, which is rare,” he says.

MacFarlane Barney backs her brother. “I can review a contract now and know what he needs

changed without having to go to him,” she says. “He in-kind trusts me that I will do that.”

She a lso appreciates t he openness they share. Says MacFarlane Barney: “Whether we like it or not, we’ll tell you the truth. Our intention is to look after each other and do what is best for the project.”

During the planning stages of Campo Felice, Bob MacFarlane says the family gathered in an open forum to state their hesitancies on any part of the project before they moved forward.

One example was adjusting the location of the mailroom to open up a direct view of the river from the lobby entrance. “We voiced them one after another.

It took a week, and we removed all those hesitancies,” he says.

Each member of the MacFarlane trio has their specialized area of expertise, but, in all kinds of projects, it’s their unified mission that motivates them. That mission, says MacFarlane Barney, is to help “people live better lives, either by revitalizing a neighborhood, restoring a building, or helping a community.”

JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

The firm has also been successful because Mark MacFarlane says the family is never married to a plan. “The real key,” he says, “is going in with a plan but being flexible to see what really works.”

SOPHISTICATED AND UNCONVENTIONAL The MacFarlane Group’s niche, says MacFarlane Barney, is finding sophisticated financing for each project, especially the unconventional ones.

For example, the MacFarlanes’ took interest in a waterfront restoration project, the Historic Samuel Colt Gun Factory, in Hartford, Conn., in the 1990s. MacFarlane Barney recalls her father “touring the dilapidated area, with buildings falling down and brownfields, yet remarking ‘wow, this is such a beautiful site,’” she says. “He saw promise and beauty where others saw obstacles.”

MacFarlane Barney secured $190 million to restore the site using city grants, state grants and federal appropriations.

“The Colt factory was the alphabet soup of financing,” she adds.

Historical preservation presented challenges in logistics and cost an additional $20 million. Bob MacFarlane, for instance, thought it was “a shame” to cover up the massive angled glass windows in the footballf ield-si zed ma nu fact u r i ng building on the site — designed to conserve electricity centuries ago. So the MacFarlanes raised the floor about 2 feet to install

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sewer, electricity and plumbing lines below, while preserving the character of the building.

The 17 buildings on site have been repurposed into a museum, a headquarters for an insurance software company, loft-style apartments and a school for autistic children.

“What evidenced our social responsibility in restoring these buildings is that it did become a national historic landmark,” says MacFarlane Barney. “It really reactivated that area.”

NEW VISIONS Mark MacFarlane, like his sister, says the Colt project and Campo Felice are evidence of his father’s ability to “see the possibility of a building.”

For Campo Felice, the MacFarlanes purchased the former Sheraton Hotel in downtown Fort Myers that sat empty for nearly a decade. Mark MacFarlane says his father “had the vision to see that this could be repurposed into senior living with the layout, the water view and the amenity space.”

The $90 million project in the downtown Fort Myers’ historic district could be completed by 2019.

In studying options for Campo Felice, the MacFarlanes discovered most senior living environments were established in a reactionary capacity to meet the medical needs of an aging population.

In response, they designed Campo Felice to meet senior lifestyle wants and filling in

MAC ATTACK

needs, such as the assistedliving and memory-care phase.

The MacFarlanes have invested in amenities and social opportunities, including areas to entertain, day trips to local attractions and a full-time activities director.

“Research shows that people age well when there is deep community connection,”says MacFarlane Barney.

Another selling point with Campo Felice, says Bob MacFarlane, is the prime spot downtown. “You can always build something at a very high price,” he says. “But in this particular case, to keep the pricing moderate, within the competition and yet have a superior location” is a compelling selling point for Campo Felice.

BIG IMPACT The MacFarlanes say their affinity for Fort Myers grew after the success of the Beau Rivage, Riviera and St. Tropez highrises. “The Beau was the first one where the city reached out into the public-private relationship with the developer to get a project going,” says Mark MacFarlane.

“The city of Fort Myers has been extremely helpful in providing (tax-increment) financing, which has allowed us to develop projects that otherwise may not have been possible,” MacFarlane Barney adds. “Fort Myers is business-friendly and a big reason why we continue to develop in the downtown area.”

Fort Myers Mayor Randy

15

The MacFarlane Group’s impact on Fort Myers covers a wide swath. Past and current projects include: n Campo Felice: A $90 million, resort-style high-rise senior living community in its second, and last, stage of development in downtown Fort Myers. Phase two will include assistedliving and memory care units. Project is in a onetime Sheraton that sat empty for nearly a decade; n The Beau, St. Tropez and Riviera: A trio of luxury-style condo towers totaling $150 million completed between 2004-2006. They were the first waterfront towers built on the Caloosahatchee River after a lull of development in the River District for decades; n Prima Luce: A 220-unit private waterfront residential condo high-rise community in the historic River District of downtown Fort Myers.

Project consists of a pair of 22-story towers.

Henderson, in an email, credits the MacFarlane development team’s projects as “a catalyst for Fort Myers and beyond.”

The MacFarlanes believe Downtown Fort Myers is ripe for multi-generational growth, yet won’t fall prey to the fast-paced nature of bigger metropolitan cities like Miami. That’s why they love it so much.

“What I like about Fort Myers is that it is a small city and you do feel such an impact with these development projects,” says MacFarlane Barney. “I want to be part of the revitalization. Changing the landscape, changing a building, changing a community.”

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BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

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Crescent, Five Star buy Sirata Beach Resort In one of the largest lodging acquisitions along the Gulf Coast in the past year, a pair of investK.L. ment firms MCQUAID have quietly purchased the Sirata Beach Resort & Conference Center for $108.2 million.

The 382-room resort, on St. Pete Beach, was purchased by a joint venture involving Crescent Real Estate LLC, of Fort Worth, Texas, and Five Star Realty Partners LLC, of Atlanta.

The seller, the Nicklaus family, had owned the resort for many years, according to Pinellas County property records.

Crescent and Five Star intend to undertake a “major renovation” to the 15.4-acre property, at 5300 Gulf Blvd., says Crescent spokeswoman Jean Suitt.

She says improvements will be made to the resort’s rooms, swimming pool, lobby, food and beverage operations and guest amenities. The company and HEI Hotels, which has been retained to operate the Sirata Beach Resort, are in the “planning stage.”

In addition to its rooms, the resort also has 725 feet of beachfront and 30,000 square feet of meeting space, according to Crescent’s website.

The sale marks the thirdlargest hotel deal in Florida so far in 2017, behind only the $214 million purchase of the 347-room Don CeSar & Beach House Suites, in St. Petersburg, and the $205 million acquisition of the 815-room Hyatt Regency Grand Cypress, in Orlando, according to LW Hospitality Advisors of New York.

Crescent, whose portfolio includes 24 properties valued in excess of $1.65 billion, also owns the RitzCarlton Dallas and the Canyon Ranch Lenox Resort, in Massachusetts.

The Sirata Beach Resort is its first major lodging asset in Florida, though the company also owns more than 2,000 apartments in the Tampa region, according to its website.

Liberty Group closes first deal with new fund The Sirata Beach Resort sale isn’t the only lodging news happening in the Tampa/St. Petersburg area, of course.

Less than two months after putting the finishing touches on its Liberty Hospitality Fund II L.P., Tampa-based Liberty Group has closed on its first hotel acquisition with the new private-equity investment vehicle.

Liberty intends to leverSee COLUMN page 17

COURTESY PHOTOS

Related Group’s Icon Harbour Island project, a 22-story tower with 340 units, was recently completed. Rents in the tower average $2,500 monthly.

Inter Related Related Group is branching out from its Miami condo base to develop a series of distinct, multifamily rentals in the Tampa area.

I

t’s been called the “condo king of Miami,” but the Related Group is amassing something of an empire in the Tampa area, as well, thanks to a handful of projects it’s developing containing nearly 1,500 residences.

Unlike its experience in South Florida, though, Related to date is making its mark along the Gulf Coast with market-rate rental developments, including a high-rise on Harbour Island, new units on the site of the former Tampa Tribune and at the Westshore Marina District, between Tampa and St. Petersburg.

Meanwhile, another company entity is partnering with the Tampa Housing Authority to revamp a 150-acre tract known as the West River, where they are expected to upgrade roughly 700 affordable housing units, sprinkle in another 900 units of marketrate housing, construct up to 170,000 square feet of commercial space and develop an art-centric, 23-acre park.

Steve Patterson, the president and CEO of Related’s development arm, says the company’s current projects are a harbinger of things to come.

“Our expectation is that we’ll continue to grow,” says Patterson, 59, who joined Related in 2010 after heading Zom Holding Inc., a multifamily developer in Orlando.

“Our strategy is to definitely mix it up in regards to developments,” he adds. “Fortunately, we have experience across all densities, and from a risk aversion standpoint, when we can spread our activities across various price points we think that’s best.”

That’s certainly been the company’s strategy in Tampa.

At Icon Harbour Island, an upscale 22-story residential tower that Related recently completed, the company is attracting older, wealthier urban dwellers, many of whom are retired baby boomers or empty nesters, Patterson says.

Rents in the 340-unit tower average $2,500 per month.

On the site of the former Tampa Tribune, Related is building an eightstory complex containing 400 units.

Patterson says the design will be more eclectic than its Harbour Island project, and appeal to a younger demographic.

The company, which spent $17.75 million to buy the former newspaper site, plans to deliver that project around the end of 2018.

Further south, Related paid $11.8 million for an 8.5-acre tract in the Westshore Marina District in February. There, it’s preparing to start work on a 396-unit rental project aimed at younger professionals who work either in Tampa or St. Petersburg.

The rentals will be the first development within the 52-acre district, which is being designed for 1,750 residences, a 200-room hotel, up to 240,000 square feet of commercial space and a 240-slip marina.

Related hopes to complete that fourstory development by the end of 2018, as well.

“They build special projects,” says Beck Daniel, executive vice president of development at BTI Partners, the South Florida firm that is Westshore Marina District’s master developer.

“They don’t just put a box up — they have vision,” adds Daniel of Related.

STEVE PATTERSON joined Related Group in 2010, at a time when the company’s development arm had no pipeline or employees. Today, roughly 100 work for Patterson, the president of CEO of Related Development, and the company has a pipeline of roughly 8,000 units.

“We also like them because they include art in their projects, and they pay close attention to the outside of their projects, too. They add value to the communities they build in, they’re not just numbers on a contract.”

And in downtown St. Petersburg, Related’s 16-story Icon St. Petersburg See RELATED page 17

JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

RELATED from page 16 project, containing 350 units, is being marketed to the city’s burgeoning “creative class” of young professionals who want to live in an urban environment.

Going forward, Patterson says the company has lined up a trio of developments in both Atlanta and Orlando, and another two in South Florida.

“We try to stay in markets that grow by roughly 20,000 jobs annually or more,” he says. “And Tampa certainly fits that bill. It gives us a foundation so we’re not blindsided by much.”

Related also looks for regions where multifamily construction volume is less than that of the national average or comparable areas.

Today, Related’s development arm employs about 100 and has 8,000 units in its pipeline. By contrast, when Patterson joined the company, during the height of the last economic recession, there were no projects even in the planning stages.

Although Related is focused on metro areas like Tampa, Patterson doesn’t rule out developing in more tertiary cities, like Naples or Sarasota.

“It’s always enticing to go into tertiary markets, but institutions are largely afraid of them,” he says. “And a part of our analysis is always what cap rate could we sell a project at going forward?

“Naples is a hard area to stay away from, though, because it has such a high

COLUMN from page 16

They build special projects.

They don’t just put a box up — they have vision.

Beck Daniel | BTI Partners, on Related Development

quality of life, and that’s very important to us,” Patterson says.

And while he acknowledges that rent hikes during this protracted growth cycle — combined with increased costs for land, labor and materials — have made financing more difficult and raised issues of affordability, Patterson believes the urban rental markets Related has targeted will remain resilient.

“Affordability has become a huge issue,” he says. “But I think people ultimately will be willing to pay a higher percentage of their income on housing in the future. It’s happened in every civilized country in the world. We’re finding that people are even willing to give up their cars if it means being able to afford to live in a more desired location.”

– K.L. McQuaid

At the site of the former Tampa Tribune, Related is developing 400 units in a series of eight-story buildings aimed at young professionals.

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: Commers Kunz LLC Seller: Commerce Park Center LLC Address: 28041 Airpark Drive, Punta Gorda Property Type: Warehouse Price: $2,500,000 Previous Price: $1,200,000, May 2006 COLLIER Buyer: Johansen Invest LLC Seller: Saw Palmetto Berries Co-Op of Florida Inc. Address: 19701 Immokalee Road, Naples Property Type: Agricultural land Price: $3,000,000 HILLSBOROUGH Buyer: HRA Venue North Campus LLC Seller: 13702 North 42nd Street LLC Address: 13702 N. 42nd St., Tampa Property Type: Student housing Price: $46,631,000 Previous Price: $49,000,000, December 2012 Buyer: Sunstone Palms LLC Seller: 12702 University Club LLC

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age “economies of scale” and a “favorable capital structure” to “unlock value” in the 120-room Hampton Inn in Norfolk-Virginia Beach, Va. “The upper select service segment of the hospitality industry continues to outperform other real estate investment sectors,” says Punit Shah, Liberty Group’s CEO. Shah adds that the Hampton Inn will undergo a “significant capital improvement” under its ownership.

Launched in January and finalized in May, the Hospitality Fund II raised $56.3 million in equity from investors, representing more than $165 million in leveraged capital to acquire both select service and extended-stay hotels throughout the U.S. through 2020.

The Hampton Inn becomes Liberty Group’s 55th acquisition overall, deals valued in excess of $425 million and involving properties with more than 4,000 hotel rooms.

CBC Saunders to host I-4 event Amazon. Walmart. Publix.

Southern Wine & Spirits.

Medline Industries. CocaCola. These are but a few of the companies that distribute goods from the Interstate-4 corridor, between Tampa and Orlando.

The buzz about the corridor has grown so great that Coldwell Banker Commercial Saunders Ralston Dantzler Realty, of Lakeland, intends to hold an event centered around the real estate, and the phenomenon, of the corridor.

The I-4 Commercial Cor-

17

ridor Conference will be held 10 a.m. to 3 p.m. Aug. 11. A lunchtime keynote address on the region’s economy will be presented by Chris Oakley, vice president of the Federal Reserve Bank of Atlanta.

Gary Ralston, a CBC Saunders partner, expects as many as 350 participants to attend the event at the Florida Polytechnic University, in Lakeland, based on a similar confab held in 2016.

“We believe the I-4 corridor, despite the success here, remains a defined geography that is under-appreciated,” says Ralston, a partner in CBC Saunders.

“We’re literally the center of Florida. There are over 20 million consumers who are reachable within a five-hour drive. So it’s our goal, through the conference, to bring that fact to more people’s attention.”

The conference will consist of a series of break-out sessions addressing industrial space, Lakeland-based Publix Super Markets Inc.’s history, commercial lending and an update on the Florida Department of Transportation’s activity.

Information about the conference can be found at i4commercial.net.

We’re literally the center of Florida.

There are over 20 million consumers who are reachable within a five-hour drive. Gary Ralston | CBC Saunders partner

BY STEVEN BENNA | CONTRIBUTOR

Address: 12702 University Club Drive, Tampa Property Type: Apartment units Price: $41,700,000 Previous Price: $21,800,000, December 2014 Buyer: BVIP Memorial Center LLC Seller: Tampa Memorial Center LLC Address: 4919 Memorial Highway, Tampa Property Type: Office building Price: $22,350,000 Previous Price: $20,500,000, May 2004 LEE Buyer: Sarco Properties LLC Seller: TNT Resources Inc. Address: 8243 Dani Drive, Fort Myers Property Type: Restaurant Price: $4,852,500 Previous Price: $4,284,000, December 2007 Buyer: GA-Pinnacle Cape Coral LLC Seller: ZREV Farms LLC Address: 4101Burnt Store Road N., Cape Coral Property Type: Vacant land Price: $1,575,000 MANATEE Buyer: Bradenton Leased Housing Associates III LLLP Seller: River Oaks Housing Partners Ltd. Address: 2710 Rive Trace Circle, Bradenton Property Type: Apartment units Price: $15,949,500

Buyer: Bradenton Leased Housing Associates III LLLP Seller: Manatee Pond Ltd. and Pond O Let Ltd. Address: Bradenton Property Type: Residential land Price: $2,950,000 Buyer: CFC Gomez Inc. Seller: Palmetto Equities LLC Address: 602 E. 20th Lane, Palmetto Property Type: Apartment units Price: $2,675,000 PASCO Buyer: Trinity Point LLC Seller: Thirty Partners LLC Address: 2132 Duck Slough Blvd., New Port Richey Property Type: Professional building Price: $2,500,000 Previous Price: $2,200,000, December 2009 Buyer: Focus Ten Care Real Estate LLC Seller: Hilltop Center LLC Address: 9310 Little Road, New Port Richey Property Type: Professional building Price: $1,300,000 PINELLAS Buyer: PHR STPFL LLC Seller: Bayboro Hoteliers LLC Address: 940 Fifth Ave. S., St. Petersburg Property Type: Hotel Price: $20,500,000 Previous Price: $2,048,400, April 2008

Buyer: Wyndham Vacation Resorts Inc. Seller: K&P Clearwater Estate LLC Address: 110 Coranado Drive, St. Petersburg Property Type: Condominium units Price: $8,657,200 Buyer: Sauteur LLC Seller: PV Marina Village LLC Address: 4801 34th St. S., St. Petersburg Property Type: Strip store Price: $6,200,000 Previous Price: $3,875,000, January 2014 POLK Buyer: LGI Homes Florida LLC Seller: GP Homes LLC Address: Lakeland Property Type: Vacant residential land Price: $2,703,300 Buyer: Dundee Property Holdings LLC Seller: Parman Group LLC Address: Bartow Property Type: Vacant land Price: $1,567,400 Previous Price: $2,000,000, June 2015 SARASOTA Buyer: Cloud Ten! Marketing Group LLC Seller: Bobcat Trail Golf Club LLC Address: 1350 Bobcat Trail, North Port Property Type: Golf course Price: $2,950,000 Previous Price: $3,000,000, February 2005

commercial real estate

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BUSINESS OBSERVER | JULY 28 – AUGUST 3, 2017

BusinessObserverFL.com

commercialq&a |

BY K.L. MCQUAID | COMMERCIAL REAL ESTATE EDITOR

What is the biggest change you’ve seen during this commercial real estate growth cycle?

BRENT MILLER Executive Vice President, JLL, Tampa “The biggest change I’ve seen is the re-emergence of spec developers. The trend has been predominantly in the industrial sector, but we’re seeing it in office now, too. To date, in the Tampa area, at least, only Vision Properties has gone forward, but I’m hearing that others have their approvals lined up and I expect them to move forward before too long, because market conditions have continued to tighten and people are paying attention to the Tampa Bay region as never before. With industrial, there’s been a fair amount of speculative development, especially in the I-4 corridor, by the likes of Cabot Partners and Duke Realty, both of which are clients of ours, and others. And that’s a good sign for the market: Spec development is a big indicator of the overall health of a market, and we’ve not seen any spec office development here for a very long time.”

JAG GREWAL Partner, Ian Black Real Estate, Sarasota “I think the biggest change, at least in the Sarasota and Bradenton submarkets, has been the influx of well-established and well-funded operators and property owners, people who really know what they’re doing and have a good track record. In our area now we have Taubman Centers, Carter, The Kolter Group — just a few of the sophisticated owners now here. That’s unparalleled in Sarasota history. But I think the last recession, ironically, got people looking at Sarasota, and now they’re building and making investments here.”

DALE PETERSON Senior Vice President, CBRE Group, Tampa “To me, the biggest thing has been the length and the velocity of this cycle.

The downturn began, in earnest, in 2008, but since then, we’ve been on an upward slope, a time marked by improving fundamentals throughout the entire region. In Tampa and St. Petersburg, especially, we continue to have both job and population growth, and those are key drivers. The thing I’ve found most surprising is that there’s been no new speculative office development to speak of, to date, though that may be changing. Every cycle or downturn, the market as a whole seems to learn something, and that ensures to a degree that there’s a safeguard against the severity of the same thing happening again. Today, we’re seeing a lot of discipline in the market, and there are responsible lenders and that’s allowing us to continue to move forward. I see a lot of runway left in the market, even though we’re now in the ninth year of this economic recovery.”

JUSTIN THIBAUT Director of Sales, Land Solutions Inc., Fort Myers “What we’re seeing is a shifting investment objective on the part of buyers, more toward sustained income rather than the traditional goal of appreciation as a primary driver. So as a result, we’re counseling sellers to shift their expectations, as well, to accommodate that change or risk losing out on sales. The Southwest Florida market has been steadily improving and stabilizing, so cap rates are compressing in just about every asset class.

That’s furthering the push by investors to consider income generation from commercial property purchases.”

DANIEL PEEK Senior Managing Director, HFF L.P., Tampa “In the past 24 to 36 months, we’ve seen a nice broadening of the capital sources that are out there to fund commercial real estate projects. On the global side, there’s a more diverse array of foreign sources to choose from than ever before. And there’s also been an increase in what I’ll call the family office. Historically, high net worth families or individuals would invest in funds as a means to make commercial real estate investments or purchases. But what we’re seeing now is, increasingly, those same families or individuals are investing directly — such was the case with the Hyatt Regency Hotel in Sarasota, which was purchased by a Tampa doctor. That’s a very different change. And there’s also been the rise of the debt fund lender. We’ve always had banks, life insurance companies and CMBS as sources of funding, but now Blackstone, Walton Street, and a host of others have these debt funds and they’re very big, they’re very liquid, and they’re filling a void in the marketplace. They’ve not been overly aggressive, either, and they’ve evolved into a good, solid source of capital from institutional, sophisticated lenders.”

COURTESY PHOTOS

JULY 28 – AUGUST 3, 2017 | BUSINESS OBSERVER

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19

AREA AMBASSADORS

The Mermaid & Corkscrews Loft debuted on Airbnb in July.

AIRBNB from page 13 also an outdoor loveseat and rocking chair under mature tree canopies. The property, which can accommodate one or two people, was booked every night during season last year, says Wadsworth. Nightly rates averaged $150 in season, around $100 in the summer months.

The couple’s second Airbnb unit stems from a bigger master plan: DeLieto, 52, wanted a man cave, Wadsworth-DeLieto (and DeLieto) sought a wine cellar and they both wanted a garage. So the couple built it on land behind their home, a 1920s Craftsman bungalow they’ve owned and lived in since 2010.

Instead of a one-level building, they went up, built a second story, where the separate

I always do my best to wow them and go above and beyond.

Valerie Wadsworth | Sarasota, Airbnb host

entrance is on the alley behind Sixth Street. They designed the building and concept with the idea of making the second floor an Airbnb unit. The construction and interior design cost at least $400,000. “We had a big piece of property,” says DeLieto, “and we knew we could do it

Valarie Wadsworth-DeLieto calls her foray into Airbnb hosting a nice “retirement income” for her and her husband, Lee DeLieto Jr. But in developing her host skills over the past 18 months, the couple has become ambassadors of sorts for the Sarasota tourism industry.

Hundreds of people have stayed at the couple’s first Airbnb. They’ve used the unit as a place to stay after a day at the beach, golf course, Sarasota Film Festival and even trips to scout out houses for sale.

More than 35 Airbnb guests have posted positive comments on Airbnb about Wadsworth-DeLieto, her high-end personal touches and the Sarasota area in general.

Wadsworth-DeLieto has so many positive comments, and no negative ones, that she was recently named an Airbnb Superhost for the highquality stays.

Hometowns of guests who have with the zoning.”

Like the Sea Turtle Cottage, the one-bedroom Mermaid & Corkscrews Loft is high-end, including cork flooring, a fully equipped kitchen and a stone, tile and rain-head shower. Wadsworth-DeLieto leaves a bowl of fruit and flowers for guests, and a bottle of wine and cookies in the fridge. A maid service comes after every stay to prepare for the next guests. “I’ve added a lot of special touches,” says Wadsworth-DeLieto.

The Mermaid & Corkscrews Loft will run from $225 to $250 a night in season, and around $150 a night in slower months.

Wadsworth-DeLieto says a lot of what she does for guests is natural hosting instincts — and a reflection of what she looks for when she travels. In the process of hosting on Airbnb, she’s learned a lot about hospitality.

On the down side, she’s discovered not everyone is honest: guests recently stole towels. On the up side, she and DeLieto have connected with guests visiting everywhere from Cape Coral to Marin County, Calif.

“I’ve learned when people travel, they really want an experience,” she says, “and I try to provide the experience as best I can.”

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visited the couple’s Airbnb units, the Sea Turtle Cottage and the Mermaids & Corkscrews Loft, include Portland, Ore., Lindenwold, N.J., and Canal Winchester, Ohio. Orlando, Canada and Wisconsin are represented, too.

“Val & Lee provide such a precious place to vacation!” wrote one couple from Sugar Hill, Ga., on Airbnb’s comment page. “Both are so welcoming, and are available should you need anything! We will definitely be back!”

Another comment highlighted the “super clean and beautifully decorated” unit. It had “everything we needed to cook meals and enjoy a glass of wine out on the patio, and had plenty of storage and hangers in the closets,” commented a guest from South Milwaukee. “(We) found it to be a great home base for exploring the beaches around Sarasota. One of our best Airbnb experiences ever!”

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