Business observer 8417

AU G U S T 4 - AU G U S T 10, 2017 | TH R E E D O LL A R S

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Real estate | Ambitious firm provides new executive a move-worthy opportunity. PG.18 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

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Window to the World

An industry leader’s manufacturing secrets reveal key lessons, from the importance of teamwork to being precise, yet nimble. PAGE 14

PGT Innovations | VENICE

REAL ESTATE

GOVERNMENT

COMPANIES

MANUFACTURING

We’re No. 1

Rest Assured

The Apprentice

MANUFACTURING

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Laser Focus

Man of Action

Sand Dollars

Florida tops t he nation in f isca l responsibi lit y — at least w it h a government that sticks to a budget.

PAGE 6

In 25 years, Sue Englander has grown EEI Manufacturing from a solo startup to a 42-person juggernaut.

PAGE 7

Chad Kovarik, after a career with Japanese automakers, turned around a Cape Coral boatbuilder.

PAGE 10

Tampa manufacturing executive Roy Sweatman tackles a typical industry challenge: finding top employees.

PAGE 12

Ocean Properties has refined its $100 million plan to raze and revamp a waterfront Sarasota hotel.

PAGE 16

Sarasota Bayfront group surpasses important milestone. 16 Firm buys Pinellas County marina for $22.5 million. 16 Colony developer chases St. Regis hotel. 17

PAGE

19 To ace succession, look for candor — not a clone.

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DON’T MISS

A Polk County medical supply firm, with a niche in sleep therapy products, has bold expansion plans.

PAGE 8

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BusinessObserverFL.com

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017 Vol. XXI, No. 29

LOOKING FOR AN INVESTOR for a profitable Automotive Collision & Paint Center in Tampa Bay

Business is at capacity and needs capital to expand working space, employees and upgrade equipment.

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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 Staff Writer/ Grier Ferguson gferguson@BusinessObserverFL.com Editorial Design / Nicole Thompson Copy Editor / Kelly Carson Contributors / Traci McMillan Beach, Steven Benna, Ted Carter, Beth Luberecki

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Address: 949 Tamiami Trail, Suite 202 Port Charlotte, FL 33953 Phone: 941/906-9386 (Legal Notices) Fax: 941/249-4901

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The Business Observer (ISSN#1539-9184) is published weekly on Fridays by the Gulf Coast Review Inc., 1970 Main St., Sarasota, FL, 34236; 204 S. Hoover Blvd., Suite #220, Tampa, FL 33609; 14004 Roosevelt Blvd., Clearwater, FL 33762; 3030 Starkey Blvd., New Port Richey, FL 34655; 5570 Gulf of Mexico Dr., Longboat Key, FL 34228; 949 Tamiami Trail, Suite 202, Port Charlotte, FL 33953; 15050 Elderberry Lane, Suite #4-12, Fort Myers, FL 33907; The French Quarter, 501 Goodlette Road N., #D-100, Naples, FL 34102; and 3730 Cleveland Heights Blvd., Suite 5, Lakeland, FL 33803. Periodicals Postage Paid at Sarasota, FL, and at additional mailing offices. The Business Observer is circulated in Charlotte, Collier, Hillsborough, Lee, Manatee, Pasco, Pinellas, Polk and Sarasota counties.

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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

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

CoffeeTalk

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COMMERCIAL

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3

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CHRIS TOMASSO, First Watch president York-based Freeman Spogli & Co., which acquired its stake in 2011. First Watch, say Freeman Spogli executives in the statement, delivered 26 straight quarters of positive same-store sales; increased average unit volumes by 22%; and nearly tripled earnings before interest, depreciation and amortization (EBIDTA.) Several other equity firms looked into First Watch, says Tomasso, when Freeman Spogli began to consider an exit. Advent’s interest dates back at least three years, when officials there informally began to check out individual restaurants. The interest grew more serious a few months ago, says Tomasso, and then Advent and First Watch officials began to speak formally, and more often. “We went through a robust and comprehensive interview,” Tomasso says. “They really get and understand our brand.”

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Fort Myers is the place Fort Myers recently scored an economic development victory, including 100 new jobs — and it didn’t even take any subsidies.

The win comes from Ace Hardware Corp., which recently announced it will open a customer care center/ call center in Fort Myers, in property inside Page Field owned by the Lee County Port Authority. When fully staffed, the 10,000-square-foot, fully renovated office space will house about 110 Ace employees.

The new space, says Klaus Buellesbach, director of the Ace Care Center, stems from the company running out of call center room in its suburban Chicago headquarters. There, in Oak Brook, Ill., Ace, the world’s largest retailer-owned hardware cooperative, has 100 employees in two buildings and three floors. “It’s not an ideal situation when you are trying to run an efficient customer center,” Buellesbach tells Coffee Talk.

Ace, through a Dallas-based site selection firm, had several parameters for a new spot. It had to be a place with competitive wages, multiple sites to look at, and most importantly, not have more than 3% of its workforce already in call center jobs. The 3% threshold, says Buellesbach, is when a location becomes too saturated in call center jobs and employee retention can be problematic.

Fort Myers has about 1.3% of its workforce in call center positions, according to data Buellesbach cites. “We wanted a size that was not too big, but not too small,” he says.

Buellesbach and other Ace executives looked at more than 900 possibilities for sites in total, then narrowed it down to a final four. The process took about a year. With the location in place, the company has already begun to interview for supervisor positions.

Estero-based McGarvey Construction Co. is overseeing the build-out, scheduled to be completed by the end of August.

While Lee County Port Authority and area economic development officials helped Ace secure the site and offered job-training assistance, no economic development funds were used to woo the company. “That wasn’t one of our considerations,” Buellesbach says.

That’s an anomaly in the economic development game in Florida, where officials often refer to money-for-jobs subsidies as imperative, if somewhat controversial. One reason Ace balked on incentives, says Buellesbach, is some of the call center jobs wouldn’t meet annual wage requirements to earn performance-based subsidies.

See COFFEE TALK page 5

GET ON THE LIST The final deadline is here for your company to be in the Gulf Coast 500.

This annual issue is a comprehensive look at the 500 largest companies in the region, ranked by annual revenue. Rankings also include fastest-growing, largest employers and women-owned businesses.

Rankings are further broken down by industry.

This issue is a must-read issue for business leaders and executives.

Inclusion is free.

To apply go to businessobserverfl.com/section/detail/gulfcoast-500-2017 The deadline is Aug. 10.

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The appetite for growth at breakfast, brunch and lunch chain First Watch — which has tripled in size in the last five years to some 300 stores — remains big. Big enough that a long-term goal is to hit 1,000 locations.

The east Manatee County-based chain now has a new ally in its quest: Advent International, a global private equity giant with more than $9 billion in investments in 27 years, focusing on the retail, consumer and leisure industries. Current and past companies in Boston-based Advent’s portfolio include Noosa Yoghurt; lululemon athletica; fast food chain Bojangles; and Five Below.

Advent acquired a majority stake in First Watch in a deal announced late last month. Terms of the deal weren’t disclosed and First Watch’s existing management team will continue to lead the company and “retain a meaningful equity stake” in the business, according to a statement.

First Watch President Chris Tomasso says Advent is at the cusp of a big growth opportunity for the chain, given trends in consumer eating habits and markets the firm has yet to tap.

First Watch is in 26 states, predominantly Florida, Texas, Ohio, Colorado and Arizona.

“There is a lot of white space for our growth, and I think that appeals to Advent,” Tomasso tells Coffee Talk.

Advent is the third private equity firm to have a stake in First Watch since 2004. The most recent was New

4 topstories from BusinessObserverFL.com

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

BusinessObserverFL.com

SARASOTA-MANATEE

Pizza company targets Sarasota Bavaro’s Pizza Napoletana & Pastaria plans to open a downtown Sarasota location — its fifth store in the region.

The Sarasota location will be at 27 Fletcher Ave., off Main Street, according to a press release. Bavaro’s founder Dan Bavaro purchased the 2,600-square-foot building.

Plans call for the building to be remodeled to have a modern industrial look and to add a 750-square-foot patio for outdoor seating. Bavaro says the location will be open by the end of 2017.

The flagship Bavaro’s opened in 2009 on Franklin Street in downtown Tampa.

Other locations include Central Avenue in downtown St. Petersburg’s Edge district and in an Orlando suburb.

quote of theweek We have been a little disillusioned with some of the bureaucratic red tape from state agencies.

Alex Lucio | 3B Medical SEE PAGE 8

Medical center names new CFO Maria Caruso has been named CFO of Venice Regional Bayfront Health, removing the interim CFO title she’s held since April.

Caruso joined Venice Re-

what do you think?

gional Bayfront Health in 2015 as assistant CFO. She has 10 years of experience in financial management of hospitals and health care systems. Prior to working with Venice Regional, she was controller for Deaconess and Valley hospitals in Spokane, Wash.

Venice Regional Bayfront Health is a 312-bed acute care hospital serving the Venice area.

TAMPA BAY

Doctor resolves fraud allegations Dr. James Norman, owner and operator of Norman Parathyroid Center in Wesley Chapel, has agreed to pay $4 million to resolve allegations of violating the False Claims Act by knowingly engaging in unlawful billing practices related to Medicare and other federal health care programs.

Authorities allege Norman submitted claims to Medicare, Tricare and the Federal Health Benefits Program for pre-operative examinations and charged and collected extra fees from federal health care beneficiaries for services he’d already received payment from the government.

The activity took place from April 2008 to December 2016, according to a statement.

Manufacturer plans 100 new jobs Medical device manufacturer Corin USA will expand its U.S. headquarters in Tampa by adding up to 100 new jobs in marketing, operations, sales and other administrative roles by 2022.

The company also plans to invest $500,000 in its new offices, according to a press release. It recently moved from offices on West Cypress Street to a new 7,000-squarefoot space on Citrus Park Lane in Tampa. Corin USA is a division of British medical device company Corin Group LLC. CHARLOTTE-LEE-COLLIER

Annual home sales increase 7% A report from the Naples Area Board of Realtors revealed a 7% increase in closed home sales in the second quarter of 2017 compared with the second quarter of 2016. The report lists 2,880 closed sales in the second quarter of 2017 and 2,704 sales in the second

Should federal regulators do more to curtail exorbitant CEO salaries?

Vote at BusinessObserverFL.com

Last week’s question:

How many years are left in this economic growth cycle?

quarter of 2016.

The North Naples market, where pending sales increased 20% over the same time periods, made an especially big turnaround, says John R. Wood Properties managing broker Coco Amar in a statement that accompanied the report.

Passenger traffic continues surge Southwest Florida International Airport in Fort Myers reported a 7.3% increase in passengers in June 2017 compared to June 2016.

In June 2017, 528,383 passengers traveled through the airport. According to a press release, passenger traffic year-to-date is up 2% from the same period last year. Delta Airlines was the June traffic leader with 132,106 passengers traveling to and from the airport. The other airlines in the top five were Southwest, American, JetBlue and United.

About 2.5 million pounds of air freight moved through the airport in June, an increase of 2.9% compared to June 2016, according to the statement.

Southwest Florida International Airport served 8.6 million passengers in 2016.

39.3% 1 to 2 years 28.6% 2 to 3 years 32.1% 3+ years

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AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

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CoffeeTalk

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FedEx, Medline Industries and Roomsto-Go. Through January, there were some 57 million square feet of industrial space in Polk County, roughly equivalent to the total amount of industrial space in Hernando, Manatee, Pasco and Sarasota counties combined.

Florida Gov. Rick Scott and Polk County Commission Chairwoman Melony Bell were among the officials who attended the recent Walmart distribution center grand opening. “Walmart has long been a major employer in our community,” Bell says in the release, “and we’re grateful for its commitment to continued growth here.”

The fulfillment center is part of a $450 million investment Walmart is making in Florida in 2017-2018. The retail giant, with $13.6 billon in net income in 2016, also received a 10-year tax abatement from Polk County to build the Davenport center.

Some other data nuggets behind the new facility include: n The size of the complex is equivalent to roughly 20 football fields; n The multilevel product storage shelving system spans 33 miles of shelving; n The dock doors can withstand wind speeds of up to 120 miles per hour.

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Polk County continues to build its case as the distribution center capital of Florida.

The latest proof comes from Walmart, which opened a massive, $150 million, 50-acre campus in Davenport, Polk County, July 18. Near Interstate 4 and Highway 27, the complex is the sixth Ecommerce Fulfillment Center Campus in the Walmart network and the first in Florida, according to a statement. It features two buildings that span more than 2.2 million square feet. There are already 500 employees working there, and Walmart officials say they plan to hire at least 1,000 more people over the next year.

Like its giant competitor in ecommerce, Amazon — which also has a facility in Polk County — Walmart designed the Davenport facility to be the distribution hub of the future.

It will house millions of items there, say company officials. “It is the latest addition to the next-generation fulfillment network Walmart is building to support its rapidly growing ecommerce business,” officials say in the statement.

In addition to Walmart and Amazon, the list of companies with distribution facilities in Polk County includes

5

Startup pounds it IBISWorld anticipates that compounding pharmacies will benefit from an aging population and drug shortages.

But getting underway on her business, Dano discovered, wasn’t easy.

“It’s such a process just to get your own business started,” Dano tells Coffee Talk. “Especially with it being a pharmacy, we have to go through government organizations and state organizations, and they all want slightly different things. It took longer than what we had anticipated.”

Now that the doors are open, Dano handles everything from filling prescriptions to consulting with patients to paperwork and marketing. Her biggest challenge is getting the word out to patients and providers that she’s here and open. She’s launched an advertising campaign, offering incentives such as free delivery, free glucose meters and free generic medications, such as Metformin, just to introduce customers to their services.

Sarasota Apothecary is at 8620 S. Tamiami Trail, at the rear of a small shopping plaza. It’s across an intersection from a CVS — ironically the national chain where Dano once worked.

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Jillian Dano was a young teen in Watertown, N.Y., when an interaction with an independent pharmacist sparked her career dream. She fasttracked through pharmacy school and found work as a pharmacist in St. Petersburg.

But Dano always felt an entrepreneurial DANO calling.

So after investing hundreds of hours in planning and store build-out, and with help from silent partners, in June Dano opened her own independent compounding pharmacy, Sarasota Apothecary. As a compounding pharmacist, Dano is qualified to fill prescriptions for both humans and animals. For people, she specializes in bio-identical hormones and custom medications, such as those free of dyes, preservatives and sugar. For veterinary uses, she can provide gel formulations applied behind the ear, and other options.

Compounding pharmacies are a growing niche. A recent report from

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BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

BusinessObserverFL.com

DataSnapshot Sunny solvency Cities and counties across Florida are facing budget shortfalls in pensions and other unfunded liabilities — some at emergency levels.

Yet the state itself is a champion of fiscal solvency, according to a new report from the Mercatus Center at George Mason University.

The study analyzed five financial metrics: cash solvency; budget solvency; long-run solvency; service-level solvency, or how much “fiscal slack” a state has to increase spending if citizens demand more services; and trust fund solvency, or the size of a state’s unfunded pension and health care liabilities. The report looked at fiscal years 2013-2015.

Florida ranked No. 1 overall on the survey. It was the only major population state in the top five, outdoing North Dakota, South Dakota, Utah and Wyoming, ranked No. 2 through No. 5, respectively. Fiscal purgatory states — Massachusetts, Illinois and New Jersey — made the bottom three, with New Jersey securing No. 50.

In Florida specifically, the report shows, the state spreads around its solvency: n On a short-run basis, Florida has between 8.19 and 10.01 times the cash needed to cover short-term obligations. Revenues exceed expenses by 7%, and the state’s net position improved by $279 per capita; n For long-term, net assets are 10% of total assets, and long-term liabilities are 34% of total assets, or $2,303 per capita, roughly half the average nationwide;

Florida Fiscal ratios Cash to short-term liabilities 1,200%

60%

150%

999%

1,000%

107%

600%

40%

40%

34%

30%

30%

22%

20%

20%

60%

Pensions to income 50%

50%

120% 90%

800%

Long-term liabilities to total assets

Revenues to expenses

10%

10%

30% 2013

2014

2015

2013

2014

2015

2013

Higher ratios strengthen fiscal health

n Unfunded pension obligations, on a guaranteed-to-be-paid basis, are $197.65 billion, or 22% of state personal income. The unfunded obligations figure, while high looking at the Sunshine State individually, is one of the better ones nationally.

The report’s authors, Eileen Norcross and Olivia Gonzalez, stress that while the numbers are big in the report, having sound fiscal policy isn’t complicated. (Read: Run it like a business, or a sound family budget.)

“Top-performing states tend to exhibit fiscal discipline in the form of having high levels of cash, maintaining revenues that exceed expenses and keeping debt levels low relative to resident income,” the report states. “These factors can easily be threatened if a state relies too heavily on narrow tax bases and volatile revenue sources or if pension plans are not adequately funded, leading to persistently large and growing liabilities.”

2014

2015

2013

2014

2015

Higher ratios weaken fiscal health

State fiscal rankings

Key Top Five

Above Average

Average

Below Average

Bottom Five

SOURCE: MERCATUS CENTER AT GEORGE MASON UNIVERSITY

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AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

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MADE ON THE GULF COAST

7

BY TRACI MCMILLAN BEACH | CONTRIBUTING WRITER

MARK WEMPLE

SUE ENGLANDER’s EEI Manufacturing Services, which manufactures products to support war efforts, was recently awarded a Florida Sterling Manufacturing Business Excellence Award.

CALCULATED RISK Clearwater-based EEI Manufacturing Services is experiencing a growth spurt.

President Sue Englander credits the growth to carefully calculated risk and laser focus.

S

ue Englander is a calculated risk taker. It’s why the former sales manager for electronics distribution organizations decided to start her own business in 1993. “I wanted to be more in control of my destiny,” Englander says. Contrary to popular opinion, Englander wanted to start her own company so she could have more time with her family.

But she didn’t jump in to entrepreneurship until she was certain that she’d be successful. She went out to her existing contacts in the defense and aerospace industry and asked, “If I go out on my own, would you give me a chance?” The prep work enabled her to be profitable from day one, providing electronics distribution support to her first customers.

EEI Manufacturing Services was just two employees in a 300-square-foot office to start.

Twenty-four years later, with Englander as president, EEI Manufacturing Services has grown to a full-fledged manufacturing, engineering and training company with 42 employees in a 25,000-square-foot facility. The Clearwater-based company sells products and services exclusively to the aerospace, defense and homeland security industries. Englander

says the products are all “life critical, flight critical … they have to be 100%. Someone’s life depends on it.”

The real story of growth has occurred over the past few of years, with EEI securing a spot with the Department of Defense’s Mentor-Protégé Program in September 2015, partnering with the Navy and Raytheon Co. In the year and a half since starting the program, the company has grown from 27 employees to 42. It has also experienced 20% revenue growth year over year.

The program includes three years of funding and two additional years of mentorship from a prime contractor — in EEI’s case, Raytheon.

It wasn’t an easy feat. The program required a three-year vetting process to make sure EEI’s finances were strong. Raytheon was aligned to transfer technology to EEI and all parties agreed it would be a good relationship.

The program is helping EEO overcome its biggest challenge — visibility and credibility in an industry dominated by big contractors. “You need advocacy. You can get lost as a small company.”

Large government contractors are always looking for reliable small businesses that are

a low risk to partner with. As a woman-owned small business, a small disadvantaged business, and an economically disadvantaged woman-owned small business, EEI fits the bill that big companies need to find to be awarded contracts with the government. Keeping a focus on specific target business and not going after commercial applications has been the best business decision she’s made, Englander says.

EEI’s customers include Orbital ATK, General Dynamics Corp., Boeing, L3 Technologies Inc., Lockheed Martin Corp., Bell Helicopter Textron Inc., Leonardo DRS Inc., GE Avionics and Honey well International Inc. “You can advertise all you want,” Englander says, but at the end of the day, all the companies care about is performance on high-level programs. “Word spreads really quickly on time, affordability and quality.”

The company has also impressed people by how clean the factory is, the amount of investment it has put into technology and the engagement of its employees. The culture of the company is, “God first, family second, EEI will take whatever is left,” Englander says.

To maintain a Class-3 product ion env i ron ment, EEI

You need advocacy.

You can get lost as a small company.

Sue Englander | EEI Manufacturing Services invests between $6,000 and $8,000 per employee in certifications every two years, Englander says. Because training is so expensive, Englander decided to expand the company to become a licensed IPC training center in 2009. At the time, the company was one of 33 centers in the country. Now the company’s revenue is split about 60% in manufacturing, 25% in engineering work and 15% in training other companies.

The move further solidified EEI’s focus and expertise in aerospace, defense and homeland security, Englander says.

Now the company is going for the AS-9100 certification, an aerospace standard that requires a huge investment. “It’s not a game changer yet,” Englander says, though she sees it sporadically in contracts. Her best guess is that eventually it will replace the ISO certification standards, she says.

8

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

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MADE ON THE GULF COAST

BY JOHN HAUGHEY | CONTRIBUTING WRITER

CINDY SKOP

ALEX LUCIO oversees a potential manufacturing expansion at Winter Haven-based medical supply firm 3B Medical Inc.

SOUND SLEEP

A medical supply firm’s expansion into manufacturing could create 30 jobs in Winter Haven — or Missouri.

A

Winter Haven res pi r a t or y de v ic e distributor is considering adding a production center that will create up to 30 manufacturing jobs by early next year — if it can secure a state direct-topatient sales license for home medical equipment.

T he compa ny, 3B Med ical Inc., is the U.S. distributor for Chinese respiratory maskmaker BMC Medical Co. Ltd. The manufacturing opportunity stems from a complicated legal settlement. In January, 3B Medical announced a fiveyear settlement with ResMed, a San Diego-based firm. ResMed produces devices that treat and manage sleep apnea and chronic obstructive pulmonary disease, in addition to cloudbased software that remotely monitors more than 2 million patients around the world.

3B Medical and BMC Medical had been embroiled in a legal dispute with ResMed since 2014, with litigation before the U.S. International Trade Commission, in Florida and California district courts, and in China and Germany. ResMed claimed 3B Medical was distributing BMC Medical Chinese-made

products that violated its CPAP humidifier, nasal mask and nasal pillow interface patents. 3B alleged RedMed was guilty of antitrust violations.

January’s agreement allows 3B and BMC to sell its products in exchange for royalty payments to ResMed, which made a one-time settlement payment to 3B to end the Florida litigation between the two parties.

“We were very pleased with the settlement agreement,” 3B Medical Executive Vice President Alex Lucio says, noting the litigation cost the company $4 million in legal fees, and, at one point, spanned three continents and included 16 lawsuits regarding “myriad intellectual property and antitrust claims.”

“When 3B opened in 2012, ResMed almost immediately engaged us in complex litigation. We were constantly fighting on defense. It literally was a David versus Goliath situation,” Lucio adds. “Thankfully the litigation is all history now.

The settlement this year allows us to put our focus back on developing new products and growing our business.”

With the legal wrangling concluded, Lucio says 3B Medical “is actively looking for acquisi-

tions and new product opportunities” and plans to “add 12 new products and expand our product from the sleep space into oxygen and related respiratory areas.”

3B Medical employs 50 people — 10 direct employees and 40 commissioned sales people — at its sales and administration office in Winter Haven. The company’s warehouse and distribution center is in St. Louis.

With legal issues resolved, Lucio says 3B is “actively considering moving production of one of our items out of China and into Central Florida,” he says.

“We’re looking at adding 20 to 30 manufacturing jobs probably by the first quarter of next year.”

However, he adds, this “significant investment” in Winter Haven is contingent on securing a home medical equipment license from the Florida Agency for Health Care Administration to conduct “direct-to-patient” sales.

That process isn’t going well, Lucio says. “We have been a little disillusioned with some of the bureaucratic red tape from state agencies, such as AHCA. The AHCA does not seem particularly business-friendly,” he says.

AHCA press secretary Sheli-

We have been a little disillusioned with some of the bureaucratic red tape from state agencies. Alex Lucio 3B Medical Inc., Polk County sha Coleman says the agency received 3B’s initial application for an HME license in April. It issued 3B a Notice of Intent to Deny the HME license June 26, claiming the company failed to provide enough financial information.

Lucio says 3B “will seek review” of the agency’s objections because it wants to expand in Winter Haven — although it is “considering opening an outof-state subsidiary” if it cannot satisfy AHCA’s concerns. 3B could get the proper license in Missouri “in a matter of weeks,” Lucio says, and “not have to worry about Florida. Where your direct-to-patient sales are is where your jobs go.”

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

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BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

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MADE ON THE GULF COAST

BY TED CARTER | CONTRIBUTING WRITER

BUILT TO ORDER Cape Coral manufacturer Action Craft is building on a reputation for stable, light fishing boats.

M

ark Raubenbush’s first telephone call last fall when he bought Naples’ Wolcott Marine went to Chad Kavorik at Action Craft High Performance Fishing Boats in Cape Coral.

The former general contractor wanted a strong start to his venture into the marine sales business. He could get that, he says, from a reputation Action Craft gained for a durable, stable and light craft that can glide quietly into a foot of water inside tidal flats and perform well in deeper waters.

He also had experience to go on. “I have an 18-year-old Action Craft that is still as solid as the day I bought it,” Raubenbush says.

“I felt that boat was underserved in the market,” he adds. “I felt it was a great boat to start building my business on.”

Action Craft in Wolcott’s inventory would give the dealership the 17-foot vessels suited for shallow waters of places like Pine Island Sound. And with such models as the 24-foot Coastline 1910 Coastal Bay, Wolcott could sell customers a boat to traverse shallow water as well as deeper depths of the Gulf of Mexico.

But Raubenbush had to be patient.

Kavorik had taken over the idled Action Craft manufacturing operation in 2012, but was still ramping up when Raubenbush began calling.

“They are not getting ahead of themselves,” Raubenbush says of Action Craft, which agreed to a 10-boat order.

As for Kavorik, he would say that not getting ahead of himself is how he stays ahead of the game.

The 45-year-old Ohio native who holds a master’s degree in manufacturing acquired Action Craft after a career working with Japanese automakers.

He first had to hire back some of the former owner’s skilled workers, refresh some of the molds, refurbish equipment and re-establish a supply chain with more than 200 suppliers, most of which are in the U.S. Unlike what Kavorik calls the “cookie-cutter” manufacturers that sell their fishing boats for half the price of his — Action Craft boats retail from $25,000 to $165,000, depending on customization — Kavorik says Action Craft uses “brain and muscle power” in place of automation. The work is done at a 15,000-square-foot plant in Cape Coral and 10,000-square-foot plant in Perry.

“It is especially hard to automate when the products in front and behind are different,” he says. “About 92% of our boats are customized.”

For some of the larger models, a typical build can run more than 1,000 labor hours, he says.

Kavorik kept the former owner’s established lineup of boats but added some later. “When I took over Action Craft in 2012, we had 12 models in the flats and bay segments. Now we have 14 models, the 12 original, a 2050 GCX crossover boat and a 17cc, which is coming later this summer.”

Kavorik says the company sold 81 boats last year and is on pace to sell 100 boats in 2017.

While most of the boats are customized, they share such characteristics as stability, smoothness in motion, limited water displacement and shallow drafts, Kavorik says.

That ability to navigate shallow water is important to Rick Gassert of Snook Fin-Addict Guide Service Inc. in Sarasota.

JIMJETT.COM

Action Craft boats owner CHAD KAVORIK sold 81 boats last year and is on pace to hit 100 sales this year.

“It will float in 8 inches of water and handle a moderate chop,” says Gassert, who has owned five Action Craft boats since 1995.

“It’s a great boat for the type of fishing I do,” he says.

Kavorik is mum on the intricacies of his manufacturing process, but notes one key is a gel-coated fiberglass cloth applied to the boat’s wide beam. The result is a slighter draft and increased stability.

“Most boat builders use chopper guns, chopping up the fabric and spraying it on the boat hull,” he says.

“We use a cloth roll on 100% of the boat. I can tell you the competition uses cloth on only parts of the boat.”

A “Qui-Dry” hull design lets the boat glide without slapping the water. The hull’s flares push the water out instead of in. Driver and passengers stay drier

this way, Kavorik says.

And with “Qui,” which denotes “quiet,” it’s easier to sneak up on schools of fish, he adds.

“They don’t hear you coming.”

The wideness and stability of the boats make customizing them easier, providing design f lexibly on console placement and other features.

Wolcott Marine’s Raubenbush said he thinks Action Craft dismantled one of competitor Pathfinder’s top-selling 24foot boats to find its weaknesses. “It responded to those weaknesses and built a better boat,” he says. He estimates Action Craft gives 10% to 20% more boat for the dollar.

“The contender always has to fight harder than the champion,” Raubenbush says. “Pathfinder is the champion in the market right now. Action Craft is the contender.”

It is especially hard to automate when the products in front and behind are different. Chad

Kavorik | Owner/President of Action Craft High Performance Fishing Boats

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

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RINGLING COLLEGE LIBRARY ASSOCIATION PRESENTS ITS 38TH INSTALLMENT OF THE TOWN HALL LECTURE SERIES Sarasota’s Premier Lecture Series®

JOHN BRENNAN

JON MEACHAM

January 22, 2018

February 12, 2018

MICHAEL LEWIS

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March 5, 2018

March 19, 2018

April 9, 2018

SUBSCRIPTIONS STARTING AT $300.

Call 941-309-5100 or email info@rclassociation.org Morning Lectures: 10:30 AM — Evening Lectures: 7:30 PM Thanks to our generous community partners: Robert Leventhal Sudakoff Foundation • Robert W. Baird Co. • Caldwell Trust Company Community Foundation of Sarasota County • Culp Henson Private Cardiology & Internal Medicine Gulf Coast Community Foundation • Oberndorf Family Foundation • Observer Media Group Sabal Trust Company • Sarasota Magazine • Sforzo Dillingham Orthopedics and Sports Medicine Sweet Sparkman Architects • SunTrust Private Wealth Tidewell Hospice • Williams Parker • Willis Smith Construction 246573

11

12

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

BusinessObserverFL.com

MADE ON THE GULF COAST

BY TRACI MCMILLAN BEACH | CONTRIBUTING WRITER

MARK WEMPLE

ROY SWEATMAN of Southern Manufacturing Technologies Inc. takes a multifaceted approach to find, train and retain good employees.

FINDING TALENT Tampa-based Southern Manufacturing Technologies Inc. has grown to $13.5 million in revenue. Now developing its next batch of top employees is the company’s top priority.

H

anging in the lobby of Southern Manufacturing Technologies Inc. is a large picture of a soldier holding a javelin missile. The picture is of Cpl. Steven Hollahan, whose troop was under attack from the Taliban when he set a record for the longest javelin missile shot ever recorded to take the enemy down almost a mile away.

Though some may be aware the javelin missile was produced by Lockheed Martin

Corp., what many may not be aware of is that some of the parts in that missile came from Tampa — from Southern Manufacturing Technologies Inc. Getting the word out through stories like that is exactly what SMT’s President Roy Sweatman hopes to do to let people know that a small manufacturer in Florida is making parts for the big names. In fact, just a few months ago, SMT parts were in the missile defense system that was tested to block a missile coming from North Korea or other threats. In the past

month, the company had a part that was in the Tomahawk missiles in Syria. “We’re in the supply chain,” Sweatman says.

SMT is not a new name on the block. The company was founded in 1953. Sweatman came from Ohio and bought the company in 1983. Since then, he’s grown the five-employee company to 110 employees and $13.5 million in revenue.

Walking through the manufacturing facility, you see hundreds of metal parts. Learning what they are used for is what’s really impressive. The parts

include a piece used in a fuel pump for Blackhawk helicopters and a turbo valve that can be used in a breathing apparatus or to control an IV drip. The company’s list of customers include Woodward, Honeywell International and Cobham. For each of its two largest customers, SMT produces more than 300 parts at its Tampa facility.

Now the company is taking an interest in OneWeb Ltd., a company that is hoping to supply global internet coverage through 900 satellites.

Though the company has

EXECUTIVE SUMMARY Issue. Talent Practice. Manufacturing Key. It’s hard for manufacturers to find new employees. These days, they have to train them.

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

been holding steady for the past several years at $12.5 million to $13.5 million in revenue, SMT is looking to spur growth.

Up until four years ago, the company was growing 15% a year. Lately, it has struggled to continue the growth due to a big challenge — finding quality people to keep up with the demand.

FINDING NEW TALENT One of the biggest problems is the lack of young talent entering manufacturing. When schools ended vocat iona ltraining programs and college became a more popular path for high school graduates, manufacturing fell off the radar.

So Sweatman is doing what he can to get involved in the community, get the company’s name out, and share with schools that a company looking for quality engineers does in fact exist.

He’s joined t he adv isor y councils at several schools, and opens the doors to his facility to provide tours for local high schools and middle schools to show them the factory. He’s even hosted a girls summer robotic camp.

Sweatman has also funded equipment and donated old machines to local schools, to make sure schools continue offering classes like “shop” in course offerings.

But it’s not just an educational campaign for students.

Sweatman is also trying to let

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others know about the company. “Florida is not as wellknown for manufacturing” as a Cleveland or Chicago, Sweatman says. The benefits of nice weather doesn’t seem to attract talent as easily as people would expect, he adds.

Sweatman is working with the Hillsborough County Manufacturing Alliance to educate the community about its needs because it creates jobs. SMT alone spends around $35,000 a month in tools, according to Sweatman. As part of this campaign, SMT is putting together videos with the alliance on what it means to be in manufacturing. The company is also investing in ads on buses as part of the publicity campaign.

APPRENTICESHIPS AND TRAINING In addition to education, Sweatman has ramped up the company’s apprentice programs.

The company has six apprentices, with five participating through AmSkills, a Tampa initiative to provide hands-on technical skills training for high school students, adults and veterans. “That’s how we train people,” Sweatman says.

“The last few years it has gotten so bad that we decided to ramp up our training dramatically.”

Sweatman is no stranger to apprenticeships. It’s how he got started in the industry with a machinist apprentice course at General Electric in Erie, Pa. From there, he worked his way

up from production control to mid-management, to general manager of GE’s facility in Cleveland.

But Sweatman knows his apprenticeship program and other efforts in the community won’t totally solve his predicament. His workforce is getting older and though they have a many years of experience under their belts, “machinists are not good teachers,” he says.

So he invested in sending 29 of his employees to become certified on-the-job trainers through the National Institute of Metal Working Skills, where Sweatman is a board member.

The team just finished its certification a little more than a month ago, and is now working on practice training and developing a database for different skills.

TECHNOLOGY INVESTMENT Many may assume that with technology advances, manufacturing companies shouldn’t be at a loss for finding people.

But Sweatman says it’s the opposite. Though technology has allowed the company to “make more parts with fewer people, the skill level of the people has to be higher to understand how to operate the technolog y,” Sweatman says.

The technology in his line of business is becoming more and more complex, he adds. One machine SMT uses for quality control is a technology that can

13

Machinists are not good teachers.

Roy Sweatman | Southern Manufacturing Technologies Inc. measure the specifications of a product to a tenth of the thickness of a single strand of hair.

The company’s investment in training and technology, along with its focus on strategic planning, is most likely what helped SMT earn the recognition as a 2017 Florida Sterling Manufacturing Business Excellence Award winner, according to Sweatman.

But investment in technology can also be scary because of the high cost. Sweatman says his best business decision was also his scariest — investing in an automated pallet system.

He learned about the machine from a contact in Colorado. He started with a single horizontal machine, but added a second a year and a half later, and eventually a third. The total investment was around $3 million.

With the new technolog y, the company can tool up dozens of jobs, run 24/7 and operate on its own for a few hours without relying on manpower, Sweatman says. “That kind of productivity is what we need to compete globally.”

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14

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

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MADE ON THE GULF COAST

BY GRIER FERGUSON | STAFF WRITER

PHOTOS BY MARK WEMPLE

DEAN RUARK, director of product management for PGT Innovations, the parent company of PGT Custom Windows and Doors; BOB KELLER, vice president and general manager of PGT Custom Windows and Doors; and DAVE MCCUTCHEON, vice president of manufacturing for PGT Custom Windows and Doors.

WINDOW WORLD Windows and doors manufactured by PGT are used in buildings worldwide. The company’s approach to efficiency and employee engagement offers key lessons for companies big and small.

E

very day, PGT Custom Windows and Doors produces some 4,000 custom products.

And these aren’t simple items with just a few steps.

On the contrary, the products made at the Venice-based company daily involve a process that can take teams of 12 to 15 people up to several hours to manufacture.

Dea n Rua rk, d i rector of product management for PGT Innovations, parent company of PGT Custom Windows and Doors, says it takes 500,000 parts to make those 4,000 products. He also says employees cut three football fields’ worth of glass each day.

How does t he compa ny, founded in 1980, do it?

For one, PGT leadership and employees maintain a constant focus on maximizing efficiency.

At the start of every shift, manufacturing plant workers attend a team meeting. The meetings aren’t run like corporate assemblies that drag on for an hour. These meetings are brief, to the point. The team leader discusses goals for the day, including safety goals and how many products they’re aiming to make during the shift.

The meetings started about a year ago. Dave McCutcheon, PGT’s vice president of manufacturing, says the meetings are for “really driving actions.”

McCutcheon says t he key question raised in meetings is: “What are the actions that are going to make us better?”

PGT’s goals aren’t like New Year’s Resolutions that end up abandoned a short time later.

These goals, instead, have no chance of being forgotten.

Above each line in the plant a

large hanging sign displays — in red — the number of products made up to that point in the shift. It’s a constant visual reminder of how far or close the team is to meeting the mark.

In the future, PGT plans to expand the displays to include company news, safety metrics and other statistics.

If the number displayed is a scoreboard of sorts, then plant employees are the players on the field. Instead of hopping around to different manufacturing lines, employees work on the same line, w ith the same people, regularly. “The manufacturing arena is kind of like sports,” says PGT University Team Leader and Code Specialist Jim Heise. “By having people work together every day it builds a team.”

This goes outside the plant, too. PGT regularly hosts competitions where the teams are

pitted against each other in bowling, softball and basketball tournaments.

Building camaraderie can be crucial when a company maintains an employee roster that rivals the student body of a large high school. More than 2,200 employees work at PGT Custom Windows and Doors on staggered shifts that operate 24 hours a day, six days a week.

Their office? Assembly and glass plants that total about 660,000 square feet. The assembly plant is so large — a little more than a third of a mile long — that during breaks, some employees head upstairs to the mezzanine above the plant floor and walk laps to get extra exercise.

Managing the sheer number of employees and training new employees is a massive undertaking. PGT is now working on creating roadmaps for plant

EXECUTIVE SUMMARY Company. PGT Custom Windows and Doors Industry. Manufacturing Key. Company manages large-scale production by setting goals.

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

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15

calendar

of

events

AUG. 8

Workers assemble and clean windows at a PGT Custom Windows and Doors plant in Venice.

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.

AUG. 11

You can’t win by just having good engineers. You have to have an engaged workforce at all levels. Bob Keller | PGT Custom Windows and Doors jobs — guides that will tell people exactly how to do a specific job. The project requires 1,000 to 1,500 documents to support the positions at the company.

To maintain relationships w ith employees, PGT, w ith $458.5 million in revenue in 2016, holds roundtable discussions, engagement meetings and quarterly town halls where workers can ask questions, voice opinions and speak with company leadership. The company also hosts a Christmas party, company picnics and other functions throughout the year. Regular recognition programs give the company a chance to acknowledge employees who have gone above and beyond in their jobs.

The goal is for employees to be connected with leadership, says Bob Keller, vice president and general manager of PGT Custom Windows and Doors.

“You can’t win by just having good engineers,” Keller says.

“You have to have an engaged workforce at all levels.”

Plant workers rotate jobs on the line so they don’t perform the same type of repetitive actions every day.

INTERSTATE COMMERCE: Coldwell Banker Commercial Saunders Ralston Dantzler will present the I-4 Commercial Corridor Conference.

The conference will address the latest commercial real estate news and trends associated with the I-4 Corridor, including insights and analysis from top market experts. Topics include specialized discussions on entertainment, land, equity capital sources, Publix, commercial lending and an update on FDOT projects, including the recently announced SunTrax Test Track. There will also be a special deal-making session. The conference is from 10 a.m. to 3 p.m. at the Florida Polytechnic University Campus, 4700 Research Way, Lakeland. The registration fee is $40. To register and view a list of speakers, go to i4commercial.net

AUG. 15

JOHN IZZI, group leader of dock operations, left, with PGT University Team Leader and Code Specialist JIM HEISE, who teaches homeowners and community associations about PGT’s impactresistant products.

LIKE A BOSS: A panel of four Tampa area women business leaders is scheduled to speak at the Greater Tampa Chamber of Commerce’s Women’s Series August Luncheon. The topic is Act Like a Lady, Work Like a Boss: What Women Need to Become Strong Leaders. Speakers include Robin DeLaVergne with the FERENC Tampa General Hospital Foundation; Maryann Ferenc with Mise En Place; Colette Glover-Hannah with Hannah’s Shoebox; and Yvette Segura with USAA. The lunch is from 11:30 a.m. to 1:30 p.m. at the Embassy Suites Tampa Downtown Convention Center, 513 S. Florida Ave., Tampa. Tickets are $50 for chamber members; $60 for non-members. For more information call 813-228-7777.

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BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

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Sarasota Bayfront issues RFQ for designers The Sarasota Bayfront Planning Organization, a group of residents, civic and business leaders studyK.L. ing ways to imMCQUAID prove a 42-acre, downtown tract in Sarasota, is seeking a designer.

The group has issued a Request For Qualifications to architects and planners interested in developing a master plan for the cityowned property, which includes the 1,740-seat Van Wezel Performing Arts Hall and other venues.

The request “invites bestin-class teams to submit their qualifications to lead a comprehensive master planning process for the site.”

AG Lafley, the former Procter & Gamble Co. CEO who is chair of the nine-member Sarasota Bayfront group, called the move an “important milestone in the transformation” of the property.

“The selected design team will engage the community in an approximately ninemonth planning process to create a visionary, sustainable and implementable Bayfront revitalization strategy,” Lafley says, in a statement.

Interested design teams will have until Sept. 1 to prepare responses. A short list of finalists will be unveiled in mid-September, and they will hold a series of public workshops the following month.

A winning design team is expected to be announced in November.

The group also has retained HR&A Advisors, a New York consulting firm that worked with Lafley at the Cincinnati Center City Development Corp., to help facilitate the design selection process. HR&A has worked with hundreds of municipalities, retailers and developers since its formation in 1976.

Atlantic Marina adds to Florida portfolio Atlantic Marina Holdings LLC has acquired the Tierra Verde Marina Resort for $22.5 million, property records show.

Tierra Verde becomes the company’s third purchase in Florida since 2015.

The Pinellas County marina includes 515 dry and wet slips and 10,000 square feet of marine retail and resort amenity space.

The Charleston, S.C.based company previously bought the PGA Marina in Palm Beach Gardens and the Fort Lauderdale Boatyard and Marina, in Fort Lauderdale. Both properties are being redeveloped and will be completed next year.

In all, Atlantic Marina’s portfolio contains in excess See COLUMN page 17

COURTESY RENDERING

Sandcastle Resort at Lido Beach owner Ocean Properties has filed detailed renderings with Sarasota planning officials outlining what the future property will look like. Each room in the expanded, 304-room resort would have a view of the Gulf of Mexico.

Bucking the Trend

Sarasota will soon be home to four new downtown hotels.

But Ocean Properties is taking a different tack.

F

ive months after signaling that it planned to raze and revamp its Sandcastle Resort at Lido Beach property, Ocean Properties Hotels Resorts & Affiliates has further refined its proposal for the Sarasota hotel.

As part of a roughly $100 million upgrade, the Delray Beach-based company plans to demolish the existing 176-room hotel, which opened in 1953, and replace it with a pair of sleek towers rising nine and 10 stories.

The new Sandcastle Resort also would feature 128 new rooms — each having an unobstructed view of the Gulf of Mexico — together with roughly 20,000 square feet of meeting, event and restaurant space, according to plans submitted late last month to Sarasota officials. Entryways and exits also would be streamlined, according to a site plan filed late last month.

The amount of meeting and retail space would rank among the largest for hotels in Sarasota County, according to tourism agency Visit Sarasota County statistics.

“It’s a very contemporary design,” says Bruce Franklin, president of Land Resource Strategies, the real estate consulting firm working with Ocean Properties on the proposal. “It’s very well thought out, and an incredibly efficient design.”

The company, which bought the former Helmsley Sandcastle hotel in February 2014 for $27.4 million, hopes to complete the redevelopment from a Nichols Brosch Wurst Wolfe & Associates Inc. design in 2019.

Ocean Properties is expected to include the renovated Sandcastle resort in its Opal Collection of luxury hotels, a current group of 11 properties in Florida that includes the Lido Beach Resort in Sarasota; The Resort at the Longboat Key Club; the Edgewater Beach Hotel, in Naples; the Sandpearl Resort and the Opal Sands Re-

SARASOTA’S NEW HOTELS Name, Address

Rooms

Opening Date

aloft Hotel 1 N. Palm Ave.

138

February 2016

Embassy Suites 202 N. Tamiami

180

Late 2017

8,000sf

Westin 1 N. Tamiami

255

July 2017

24,000sf

Ovation 1255 N. Palm Ave.

164

Fall 2017

10,000sf

81

2018

Sarasota Modern 1242 Blvd. of the Arts

Sandcastle Resort 304 1540 Ben Franklin Drive

Meeting Space

2019 20,000sf

SOURCE: CITY OF SARASOTA ECONOMIC DEVELOPMENT DIVISION

sort, both on Clearwater Beach; and the Zota Beach Resort, on Longboat Key, which recently re-opened after a multimillion-dollar renovation.

In all, Ocean Properties owns more than 100 hotels containing 17,000 rooms throughout North America, including the Sanibel Island Beach Resort and the Marriott Key Largo Bay Beach Resort, according to its website.

But the plans for the 1540 Benjamin Franklin Drive property on Lido Key come as Sarasota is preparing to absorb four new upscale hotels — after losing roughly 600 keys to condominium conversions a decade ago.

In all, the new hotels, and a fifth completed early in 2016, will add or have added nearly 820 new keys to the city’s inventory, despite a lack of new traffic drivers such as a conference center or corporate headquarters’ relocation.

Sarasota’s Siesta Key Beach, howev-

er, has been riding a wave of positive publicity after being named America’s best in May in an annual survey — the second time that has occurred this decade.

After Stephen “Dr. Beach” Leatherman named Siesta Key No. 1 in 2011, tourism officials reported a consistent spike in hotel traffic that was sustained for years.

The city’s handful of new hotels — a 255-room Westin; a 180-room Embassy Suites; a 164-room property known as Ovation that will be part of the Marriott Autograph Collection; the 89-room Sarasota Modern; and a 138-room aloft that debuted last year — are all located in or just outside of Sarasota’s urban core, just blocks from each other.

Ocean Properties’ plan, by contrast, See SANDCASTLE page 17

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

SANDCASTLE from page 16

COLUMN from page 16

would result in a 304-room hotel on a sixacre tract of beachfront land on Lido Key, outside the city center.

Analysts say that distance — together with its beach access — will differentiate Ocean Properties from the pack of newcomers.

“The beaches in Sarasota are totally different markets from downtown, even though one can access the beaches there within a 20-minute drive most of the year,” says Kent Schwarz, an executive vice president at commercial real estate brokerage Colliers International Florida, who specializes in lodging properties.

“The new downtown hotels in Sarasota, I believe, will draw primarily from lodging properties at the (Sarasota-Bradenton International) airport and from incremental gains in demand,” Schwarz adds.

“But there’s nothing like staying at the beach. It’s a totally different experience and as such there’s often a totally different product. And Ocean Properties is a great company with a great portfolio.

They know what they’re doing.”

As part of the redevelopment and rezoning request for the Sandcastle Resort, Franklin says Ocean Properties has completed both a required traffic study and neighborhood meeting.

Sarasota’s Development Review Committee, the first step in the development process, is expected to consider Ocean Properties’ proposal in mid-August.

Unless major obstacles occur, hearings before the City Commission could occur as early as November.

“The renovated Sandcastle would be a nice addition to the lodging inventory in Sarasota,” Schwarz says. “I think it will spur others to make similar investments.”

– K.L. McQuaid

They know what they’re doing. Kent Schwarz | Colliers International, on Sandcastle Resort owner Ocean Properties

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 NONE COLLIER Buyer: Vanderbilt Naples Holdings LLC Seller: Vanderbilt Real Estate Holdings Ltd. Address: 9136 Gulf Shore Drive, Naples Property Type: Vacant commercial land Price: $18,300,000

BusinessObserverFL.com

of $200 million worth of marina properties.

“Our focus is on quality of real estate, not quantity,” says Atlantic Marina principal Joe Miller. “The purchase of Tierra Verde Marina Resort is in keeping with our strategic goal of investing in high barrier to entry ‘core’ markets in Florida and the Southeast.”

The Tierra Verde property will be managed by AMH Management.

Sarasota Quay hires development manager Jacksonville-based GreenPointe Communities has hired a development manager ahead of plans to begin construction on a 15-acre, waterfront project in downtown Sarasota.

Brett Blank comes to the mixed-use Quay Sarasota project following a career developing multifamily projects in Colorado for the past two decades. In 2016, he worked on a 1,400-acre, master-planned community called Arden, in Palm Beach County, with Freehold Capital Management LLC, of Boston.

“The opportunity to build something right on the water, in one of the last urban areas available anywhere on the West Coast of Florida was one I couldn’t pass up,” says Blank, 47. “And that GreenPointe has such a great history only added to it.”

In addition to the Quay Sarasota — a project planned for 695 residences, 175 hotel rooms and roughly 240,000 square feet of retail and office space — Blank also is coordinating with Florida Department of Transportation officials on a roundabout at the entrance of the roughly $1 billion project and required

infrastructure on site.

He is also spearheading efforts to revitalize the Belle Haven Hotel, a historic structure on the Quay property that will become local GreenPointe offices, says Rick Harcrow, the company’s regional president for the Tampa/Sarasota area.

Infrastructure at Quay Sarasota is expected to begin next year, with the project being developed in “blocks” for the next decade.

Colony coup with St. Regis If a deal to include a St. Regis Hotel within a revamped Colony Beach & Tennis Resort on Longboat Key comes to fruition, it would be a true coup for the 19-acre property.

That’s because St. Regis, the luxury brand under the Starwood umbrella — now a part of the world’s largest hotel company, Marriott International Inc. — is fairly discriminating when it comes to new properties.

The brand is only attached to 16 hotels in North America, for instance, and just 60 worldwide.

There is just a single St. Regis in Florida at present, the St. Regis Bal Harbour Resort, north of Miami Beach.

Moreover, there don’t appear to be any other new St. Regis hotels planned for the U.S. in the foreseeable future.

Only three new such hotels are in development in North America, according to the company’s website, in Bermuda and a pair in Mexico.

St. Regis and developer Unicorp National Developments Inc., which is moving ahead with plans to re-open the resort closed since 2010, are working to formulate a term sheet for the deal now, says Unicorp President Chuck Whittall.

Last year, Unicorp unveiled plans for a redevelopment that

17

included a 180-unit luxury hotel and 180 upscale condos on the property.

Tampa area gaining tech workers Tampa ranks roughly in the middle of the top 50 U.S. and Canadian markets for its ability to attract and retain technology-oriented employees, according to a new survey from commercial real estate firm CBRE Group Inc. CBRE’s Tech Talent Scorecard puts the city at No. 27, but perhaps more notably, Tampa grew at the fastest rate of any of the 50 markets studied, with a gain of 55%, or 16,140 jobs since the annual survey began in 2012.

CBRE contends tech companies are willing to pay a premium to be located in areas where tech-related talent is abundant.

Tampa also ranked as the most affordable market of the 50 studied for software developers, engineers and others, despite having average wages that are somewhat below the national average.

“Since the cost of talent is the largest expense for most firms, the quality of that talent is becoming one of their most important considerations,” says Colin Yasukochi, a CBRE director of research and analysis and the report’s author.

Tampa also ranked as having the third-largest tech talent labor pool among the report’s smaller markets, with 45,340 employees, behind only Charlotte and Columbus, Ohio.

The top 10 cities with techcentric labor bases, perhaps not surprisingly, are San Francisco; Seattle; New York; Washington, D.C.; Atlanta; Toronto; RaleighDurham; Austin, Texas; Boston and Dallas/Fort Worth.

Rankings are determined by more than a dozen criteria, including growth, cost of occupancy and industry outlook.

BY STEVEN BENNA | CONTRIBUTOR

Property Type: Shopping center Price: $21,550,000 Previous Price: $4,985,000, March 1996 Buyer: AK Piscataway Associates LP Seller: Frantine Commercial Real Estate LLC Address: 3684 W. Gandy Blvd., Tampa Property Type: Retail store Price: $8,300,000 Previous Price: $7,200,000, April 2015 Buyer: CHCT Florida LLC Seller: Bay Area Physicians Real Estate LLC Address: 6043 Winthrop Commerce, Riverview Property Type: Medical office Price: $7,200,000

Buyer: Bayshore Suites LLC Seller: Irene Lichtefeld Address: 3248 Bayshore Drive, Naples Property Type: Multifamily units Price: $2,100,000

LEE Buyer: JA McKinney Properties LLC Seller: ALLLLB Holdings LLC Address: 28731 South Cargo Court, Bonita Springs Property Type: Warehouse Price: $2,500,000

Buyer: Lock Up – Taylor JV LLC Seller: Livingston Professional Center LLC Address: Naples Property Type: Vacant commercial land Price: $1,500,000 Previous Price: $4,000,000, September 2006

MANATEE Buyer: Fay Magnolia LLC Seller: PV Cortez Village LLC Address: 6610 W. Cortez Road, Bradenton Property Type: Community shopping center Price: $4,300,000

HILLSBOROUGH Buyer: Publix Super Markets Inc. Seller: Ellis & Co. LLLP Address: 2616 W. Hillsborough Ave., Tampa

Buyer: Meditrina Properties LLC Seller: US Highway 301 LLC Address: 1201 N. U.S. 301, Palmetto Property Type: Retail store

Price: $2,184,000 Previous Price: $1,050,000, December 2013 Buyer: Regata Royale LLC Seller: Wayout Investments LLC Address: 507 W. 10th Ave., Palmetto Property Type: Apartment units Price: $1,700,000 PASCO Buyer: Taylor Morrison of Florida Inc. Seller: WS-TSR LLC Address: New Port Richey Property Type: Vacant land Price: $3,702,600 PINELLAS Buyer: Publix Super Markets Inc. Seller: Ellis & Co. LLLP Address: 525 S. Belcher Road, Clearwater Property Type: Shopping center Price: $23,810,000 Buyer: Florwater Investment Group LLC Seller: Menorah Manor Senior Living LLC Address: 255 59th St. N., St. Petersburg Property Type: Assisted living facility Price: $8,415,000 Previous Price: $1,000,000, March 2009 Buyer: FL 201 LLC Seller: HUPP Retail GTB LLC Address: 2010 Greenbriar Blvd., St. Petersburg Property Type: Retail store Price: $2,460,000 Previous Price: $1,400,000, May 2013

POLK Buyer: Publix Super Markets Inc. Seller: Armstrong Reunion LLC Address: 8006 Osceola Polk Line Road, Davenport Property Type: Shopping center Price: $23,350,000 Previous Price: $14,300,000, January 2006 Buyer: The Harbor Coastal Income Properties Seller: Robert Smith Address: 10511 Monroe Court, Lake Wales Property Type: Mobile home park Price: $5,000,000 Previous Price: $750,000, July 2002 SARASOTA Buyer: CND-Payne Park LLC Seller: Quincy Real Estate Holdings LLC Address: 301 S. School Ave., Sarasota Property Type: Vacant commercial land Price: $8,300,000 Previous Price: $7,607,600, June 2010 Buyer: KH Palmer Blvd. LLC Seller: Palmer Place LLC Address: Sarasota Property Type: Vacant agricultural land Price: $4,181,332.29 Buyer: 4994 STT LLC Seller: Ten Mile Range Properties LLC Address: 4994 S. Tamiami Trail, Sarasota Property Type: Restaurant Price: $2,366,000 Previous Price: $3,474,000, July 2004

commercial real estate

18

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

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New Kid in Town Liz Madzula spent two decades with GE Capital, dreaming about ways to relocate to Southwest Florida. Dilweg Cos. obliged.

G

rowing up and then working in Connecticut and later New York, Liz Madzula dreamed of someday relocating to Southwest Florida, where memories of visiting her grandparents’ home in Bradenton in the late 1970s left an indelible impression.

In May, she got her long-standing wish, courtesy of the Dilweg Cos., a North Carolina-based commercial real estate investment firm that splashed into the Gulf Coast market this spring with the purchase of eight office buildings from Tampa to Sarasota.

As a Dilweg managing director, market leader and asset “enhancer” — company founder Anthony Dilweg chafes at the title asset manager — Madzula will be responsible for overseeing millions of dollars in planned improvements, leasing vacant space and scouting out future acquisitions.

Dilweg, whose portfolio is now valued in excess of $1.3 billion following the Osprey purchases, hopes to grow into a $5 billion company within the next five years. Much of that growth, Madzula and other company officials say, will come from Florida.

“The company acquired some great product, all of it value-add, which is what we specialize in,” says Madzula.

“My role, quite simply, is to get the company’s invested money back, plus. To do that, I’m going to work to improve the day-to-day operations, generate new and retain existing tenants and complete a series of capital improvements we have planned to help the overall aesthetic.”

It’s a role Madzula is well acquainted with, after having worked for more than two decades with GE Capital Corp., the finance and commercial real estate investment arm of General Electric Co. Madzula started at GE Capital while in college, as an intern, and joined the financing conglomerate after graduating, first in accounting and later in finance.

She was drawn to the commercial real estate side of the business in part because her father had worked in the industry, as both an architect and general contractor, and because of the nature of land and bricks and mortar.

“It’s a very tangible business, and that appealed to me,” Madzula says.

“It affects everything. And I’ve really enjoyed, for the most part, the people I’ve met and had a chance to work with.”

Her first four years with GE Capital were spent in Connecticut, but when she shifted into asset management she moved to New York. There, she worked on debt and equity deals, orchestrated joint ventures and commercial real estate mortgages.

“She’s extremely bright and conscientious, and very diligent,” says Joe Manasseri, Madzula’s boss at GE Capital for much of her tenure there and today executive managing director for a tri-state area that includes New York for brokerage and services firm Cushman & Wakefield.

“Liz always puts the client first, she’s terrific at property recon and asset management, she knows how to resolve issues and build customer loyalty,” he adds. “She’s all around a terrific person, one of my favorite people I have ever hired.

“Other than being a Dallas Cowboys’ fan, there’s really nothing wrong with her.”

Through GE Capital, Madzula met Dilweg, a former Duke University and National Football League quarterback, nearly a decade after he’d formed his own real estate company.

“I admired him and the business he’d built,” Madzula says of Dilweg.

Madzula left GE Capital in 2015, when its parent sold the company as part of a massive corporate restructuring away from its traditional lines of business. At the time, GE Capital had roughly $90 billion in assets under management.

A stint at New York Life Insurance followed her GE Capital exit, but Madzula never abandoned her idea of moving to Southwest Florida. On long weekends and holidays, she often flew down and stayed at the Resort at the Longboat Key Club on the barrier island shared by Sarasota and Manatee counties. It was a step, she figured.

Dilweg offered her a chance to take another, even bigger leap, after buying the 13-story Sarasota City Center in downtown Sarasota in April for $36.5 million.

By the end of May, Dilweg’s newest market leader — one of four in the company at present — was steeping herself in architectural drawings and construction budgets for another half-dozen buildings in Tampa and Lakewood Ranch.

In all, Dilweg spent $216.5 million to buy the buildings — together with a 23-story tower in Charlotte, N.C. — from affiliates of Osprey S.A. Ltd. and Osprey East LLC. It financed the deals, totaling nearly 1 million square feet, with capital from Torchlight Investors and Benefit Street Partners Realty Trust.

In a few cases, Dilweg scored a significant discount to the price paid a decade earlier. One building in Tampa sold for 44% less than what Osprey had paid, property records show.

Sarasota City Center alone is slated to receive nearly $4 million in upgrades to its lobby, bathrooms, hallways, courtyard and fitness center.

Dilweg also is considering adding a conference center and a tenant social space in the building.

“It’s a gorgeous building,” Madzula says. “Its bones are really good. So we’re going to focus on updating the lobby, making it brighter, and modernizing things like bathrooms and corridors.”

Similar improvements are planned at Orion Center on Rocky Point, where Dilweg plans to renovate the lobby, elevators, an on-site fountain and gut a pair of floors once occupied

by Laser Spine Institute. A new building name may be in the offing, too.

Madzula also will direct upgrades

LORI SAX

LIZ MADZULA joined Dilweg Cos. of North Carolina earlier this year to help the company purchase a portfolio of properties from Osprey East LLC and Osprey S.A. Ltd. Now, Madzula will be responsible for making improvements to the eight buildings and scouting out additional acquisitions.

She’s extremely bright and conscientious, and very diligent. Liz always puts the client first, she’s terrific at property recon and asset management, she knows how to resolve issues and build customer loyalty.

Joe Manasseri Executive managing director, Cushman & Wakefield

at Westlake I and II, in Tampa, where a new heating, ventilation and airconditioning system is needed, and Lakeview at Hidden River, where plans for lobby upgrades are being formulated.

Dilweg hopes to complete all the repairs and improvements within six months.

“The sooner we begin, the sooner people will see an impact, and we understand that. People want to see results,” Madzula says.

Madzula won’t be alone in leasing efforts, however. Dilweg has tapped Colliers International, JLL and CBRE to market and lease various buildings in the new portfolio.

But she will largely be on her own to scout out new properties for Dilweg.

“The company plans to expand throughout the Southeast, and Tampa and Sarasota are logical places for us because it’s such a growth area,” Madzula says, adding Dilweg may also branch out to cities like Orlando and Jacksonville.

Back in her home base in Sarasota, Madzula says she’s thankful that Dilweg helped her achieve the goal of moving to Florida full time. But she didn’t wait for them to make it happen.

In 2015, Madzula took the plunge and bought a condominium on Longboat Key. “I feel connected here,” she says. “I live here and I breathe it in every day, and it’s refreshing.”

– K.L. McQuaid

AUGUST 4 – AUGUST 10, 2017 | BUSINESS OBSERVER

bottom-line behavior

BusinessObserverFL.com

BY DENISE FEDERER | CONTRIBUTING COLUMNIST

How a CEO’s Personality Affects Succession Planning Smart CEOs will take time to uncover what their children bring to the table — even if it looks different from the status quo.

There are many tried and true steps family business owners can take to facilitate the smooth transition of power. However, while legacy planning has some science behind it, it’s also an art — which means any number of variables must be taken into consideration in specific situations.

Perhaps one of the biggest is the CEO’s personality, which could play a significant and often unexpected role in determining how the future plays out for the company — absolutely in the short term and possibly over the long term as well.

DON’T LOOK FOR A CLONE As a family business adviser, I’ve worked with many CEOs who believe their successors must be “clones” of them, since their way of operating has brought the business to where it is today. That is rather shortsighted, as this

example illustrates: The CEO didn’t have a college education but was a schmoozer extraordinaire. He’d built the business on developing strong relationships and was never been shy about shaming his team when he was disappointed with them. His daughter, who was his heir apparent, was highly educated, quieter and gained experience in the corporate sector by successfully managing 150 people before joining the family business. Her focus on respect totally clashed with her dad’s way of doing things — and led to her resigning, leaving her dad heartbroken.

This sad story could have been prevented if the father and daughter realized the most important thing was for them to align their values — and use their unique styles to achieve them.

Too many family business CEOs get frustrated if their children don’t emu-

out of the office |

NOLAN WRIGHT and JOHN COLELLA with TriNet

Try for More One of the largest employers in east Manatee County celebrates its renovated offices.

Area officials and executives with national human resources outsourcing firm TriNet celebrated the opening of the firm’s renovated east Manatee County offices July 17.

The project, an overhaul of TriNet’s 90,000-square-foot campus in Lakewood Ranch, lasted about a year and cost around $1.2 million. San Leandro, Calif.-based TriNet has grown its employee base in Lakewood Ranch more than 200% in the past two years, and now has more than 500 employees Right: KANE PIGLIAVENTO, ADEL HOSEIN, JOE BUSH and JACK KRIMMEL with TriNet

19

late them, when they really should be taking the time to talk with them, hear their perspective, and learn something from them. CEOs who are stuck in a model that may not work anymore may be getting their business stuck as well.

PAVING THE PATH TO THE FUTURE Those who start family businesses are usually very strong people who took a lot of risks to achieve success. It might seem it would take five people to do everything they bring to the table — but it simply is not realistic to expect the next generation to fit that exact mold. A better strategy is to determine the roles and responsibilities that give their probable successors the best opportunity to showcase their skills — and then let them flourish using their own style.

It can come as a big surprise to some CEOs that their offspring’s style — even if different from theirs — is a big hit with clients and staff members. For instance, it may represent a welcome

Denise P. Federer, Ph.D. is founder and principal of Federer Performance Management Group. She has 27 years of experience working with key executives, business leaders and Fortune 500 companies as a behavioral psychologist, consultant, coach and trainer. Contact her at: dfederer@fpmg.info change to move from an emotional, passionate, frenetic CEO to one who is calm, thoughtful and never panics.

What should never be lost, however, are the aspects of style that have made the business successful — non-negotiable things like responsiveness and quality control.

Smart CEOs will take time to uncover what their children bring to the table — even if it looks different from the status quo. For instance, there can be significant value to moving from a veteran leader who works 70% on and 30% in the business using a style that may no longer be effective to a nextgeneration leader who’s still learning the ropes and currently works 70% in the business using a more modern style, while spending 30% on building new business. When values are aligned, and CEOs back down from the belief that their way is the only way — the leadership transition will be smooth and the future quite bright for the business.

BY LORI SAX | CONTRIBUTOR

ERIN HORTON, KEVIN THOMAS and BARBARA BELLAY with TriNet

Manatee County Commissioner VANESSA BAUGH and DOUG BROWNELL with TriNet

20

BUSINESS OBSERVER | AUGUST 4 – AUGUST 10, 2017

BusinessObserverFL.com

ASSISTED LIVING FACILITY FOR SALE, SARASOTA

NATIONAL POWER, LOCAL EXPERTISE

APARTMENT / MULTI-FAMILY DEVELOPMENT SITE, NOKOMIS

Great 8.8 +/- Acre apartment or condo development site just off U.S. 41 in Nokomis. Close to beaches and businesses.

Already zoned for up to 80 units but additional land may be available. $1,750,000.

Brad.Lindberg@SVN.com • (941) 356-0338

NORTHWEST BRADENTON NEIGHBORHOOD RESTAURANT FOR LEASE

3,600 +/- sf Assisted Living Facility for sale on a Confidential Basis. This well-furnished facility with great landscaping is licensed for 10 residents. Built new in 2000, it is located in a desirable area and can be expanded to 16 residents. Full financials are available with an executed Non-Disclosure Agreement.

Scott.Rimmer@SVN.com • (941) 724-0554

CONDO OFFICES INVESTMENT OPPORTUNITY, NORTH SARASOTA

Four contiguous Office Condo Units in Commerce Park, close to I-75 and Fruitville Road. Great location in the growing North Sarasota and Lakewood Ranch. Will suit 1031 Exchange and is fully leased! Asking $399,000 Peter.Bartys@SVN.com • (941) 780-1390

DOWNTOWN FREESTANDING BUILDING, SARASOTA

A 3,840 +/- sf restaurant opportunity inside Blake Park is ready to be occupied! This location has a quaint neighborhood setting, with a heavy lunch crowd due to the high medical traffic from surrounding doctors’ offices and hospital.

Angela.Varga@SVN.com • (941) 787-7887

Highly visible 6,950 +/- sf building directly fronting 12th Street. Very solidly built structure with seven 8 foot overhead warehouse loading doors and 1,900 SF of air conditioned office in the front entry. Perfect investment for an owner user with additional rental income. $530,000.

Mike.Migone@SVN.com • (941) 812-7437

FEATURED PROPERTY

NEWLY RENOVATED OFFICE / RETAIL SPACES FOR LEASE, NORTH SARASOTA

Multiples spaces available with quick access to I-75, Downtown Sarasota and Lakewood Ranch. New owners have just completed a major renovation with updated facade, clean & updated office or retail units. Build-to-suit opportunity available, with a possible restaurant build out.

Tony.Veldkamp@SVN.com • (941) 487-6990

FREESTANDING BUILDING, BRADENTON

Maintained 3,188 +/- SF just off of 63rd Ave. building with on-site parking. Currently being used as a daycare facility.

Debra.Cooper@SVN.com • (941) 730-1700

FEATURED ADVISORS

DIANE LAWSON, CCIM Diane Lawson has been in the commercial real estate industry for over 20 years, specializing in the sales and leasing of office and retail space. Starting out in property management and leasing she has extensive experience in managing over 750000 sf office spaces and closed over 400 lease transactions. She holds a broker’s license and is one of only 6% of commercial brokers nationwide to be honored as a Certified Commercial Investment Member (CCIM) designee.

Diane can be reached at

(941) 780-6136 or Diane.Lawson@SVN.com

SCOTT RIMMER

PENTHOUSE SUITE BUILD-TO-SUIT LEASE, DOWNTOWN SARASOTA

Don’t miss this exceptional 7,926 +/- sf opportunity! Sabal Palm Plaza is under construction with only the penthouse suite remaining. Enjoy excellent visibility at this signature building. The owners are offering a competitive tenant improvement allowance to ensure your suite is built to your specifications.

Scott Rimmer is an Associate Advisor specializing in the lease and sale of industrial properties throughout the Suncoast area with a focus on helping companies expand or relocate in Florida. Prior to joining SVN, Scott was Vice President of Business Attraction for the Economic Development Corporation of Sarasota County (EDC), a public/private partnership focused on growing and diversifying the economy of Sarasota County. At the EDC, Scott helped companies of all sizes, requiring a strong knowledge of the local market, as well as the regulations and incentives affecting businesses and their owners in Florida. Scott can be reached at

(941) 724-0554 or Scott.Rimmer@SVN.com.

Diane.Lawson@SVN.com • (941) 780-6136

Sales • Leasing • Property Management 1401 Manatee Avenue West, Suite 950, Bradenton • (941) 747-7887

SuncoastSVN.com

248256

1626 Ringling Boulevard, Suite 500, Sarasota • (941) 387-1200