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Dunkin' Deals
Dealmaker Marvin Kaplan brought the first Dunkin' Donuts to Sarasota in 1992. Now he and his partners plan to return the franchise to the market with 16 new locations.
By Sean Roth
Real Estate Editor
Marvin Kaplan owes a lot to cars and coffee. Those two loves and an eye for opportunity have led him to commercial dealings with Pope John Paul II, Britney Spears, James Earl Jones and Ice-T. Kaplan has real estate interests on U.S. 301, U.S. 41 and State Roads 70 and 65, and he has partnered with Kevin Millard and Shawn Cabral to bring Dunkin' Donuts back to dominance in the Sarasota market.
But it all goes back to cars.
The year was 1974, and Kaplan was studying marine biology at the University of West Florida, Pensacola. In his off time, Kaplan worked for the U.S. Environmental Protection Agency. He also had a second job as a salesman at a car dealership.
"I was selling just about everything, both new and used foreign cars," Kaplan says. "There were a lot of car sales there because we were so close to the naval base. The first thing they would buy when they got there was a car."
After college graduation, he moved back with his parents in Westchester, N.Y. With their help, he obtained a bank loan and bought a Porsche engine for $600. He sold the engine and then used that money to buy two Volkswagens. Proceeds from those deals bought a used Porsche.
Two years later, Kaplan was selling so many cars he bought a car dealership. By 1988, his company was selling 300 cars monthly. In addition, Kaplan was also buying commercial property, primarily industrial and retail properties on street corners.
"It grew into the largest wholesale auto dealership in Westchester, N.Y.," he says of the dealership.
In 1988, Kaplan decided to move to Florida, in search of a better education for his children.
Kaplan visited friends in Naples, but once he saw Sarasota he fell in love, he says. After the move, Kaplan looked for local investments while he continued to own the New York dealership and properties.
"My biggest problem when I first got down here was that I couldn't find a good cup of coffee," Kaplan says.
In the early 1990s, after hooking up with Sarasotan Marty Lisella, a former New Jersey real estate businessman, Kaplan signed on as the financing partner to bring the Dunkin' Donuts franchise to town.
Kaplan was primarily a silent partner, and Lisella was the main day-to-day operator. From 1992-1994, they opened four stores. The retail locations were successful, Kaplan says, but with Lisella facing a divorce, the partners sold the franchise toward the end of 1995.
Then Kaplan met Millard, owner of Sarasota's Hurricane Glass Shield. Millard and Kaplan partnered to develop a Dunkin' Donuts franchise in Charlotte County. Eventually, they developed eight restaurants. The men have since purchased and sold the Dunkin' Donuts franchise operations in Fort Myers and Naples, with a total of 10 restaurants. They now own 8 stores in Charlotte.
In 1994, on a flight into Sarasota Bradenton International Airport, Kaplan became involved in a discussion with another passenger, Jim Morrison, whose father invented soft contact lenses. An excited Morrison told Kaplan about the discovery of a new system to make modular plastic and metal eyeglasses. The new method was cheap and efficient; a pair of glasses could be assembled in about two minutes and could sell for as low as $20 a pair.
"We took the concept and opened up retail kiosks called Jeepers Peepers," Kaplan says. "We retained the Web access domain of eyeglass.com. We have been selling discount frames there for a while. This year we have added lenses. We still get about 12,000 hits a day."
In 1997, Kaplan sold Jeepers Peepers to its parent company, Morrison International.
Then in 2001, Kaplan became involved in an unusual deal. A lawyer friend of Kaplan's from New York called. One of his clients was looking for an investor.
"It seems this guy had secured the rights from the Vatican to the pope's personal prayers," Kaplan says. "It was a pretty interesting deal; it called for a total of eight books in Latin. The pope is really a brilliant guy; he speaks 32 languages. The pope wrote a new prayer almost daily during his travels through various countries over 25 years. Every prayer is dated and has what country he was in."
Kaplan backed the deal.
Shortly thereafter, Simon & Schuster bought the rights to produce the prayers in book form. So far, Simon & Schuster has issued a third book and sales are said to be average for a religious publication.
But the prayer deals didn't stop there.
Kaplan's partner suggested creating a CD and video using the prayers with 26 famous musicians and actors. Britney Spears, James Earl Jones, Steven Tyler, Joe Perry and the band 98 Degrees have all recorded the English translation of the prayers either spoken or sung.
"We are trying to do this in every language and in every country," Kaplan says. "We are also doing greeting cards with the pope's prayers on them. Ice-T came to us to use the prayers on his clothing line (Ice Wear) for young kids. That deal is probably 50/50. The real upside from a business perspective will be when the pope passes on. He is one of the most well-known and beloved popes in history."
So what does the pope think of the entrepreneurial efforts of Kaplan and his partner?
"He is really behind us on this," Kaplan says. "He just wants to do everything he can to get the message out to children."
Kaplan, who is Jewish, was invited to meet the pope in October of 2001, but declined because of security concerns stemming from 9/11.
In 2002, Allied Domecq Quick Service Restaurants took the Dunkin' Donuts franchise back from its Sarasota market operator, because of management issues. Stripped of their franchise backing, the Sarasota Dunkin' Donut shops were forced to close. Not good news for local Dunkin' Donuts' lovers.
Kaplan partnered with Millard and Cabral, a restaurateur and Millard's son-in-law, and bought back the franchise for the area. They plan to develop 16 locations in Sarasota within five years.
The group's first six new locations for the franchise are mapped out and most involve the creation of 4,000- to 8,000-square-foot strip centers.
"These are premium locations," he says. "The only way we could make it work was to build these strip centers. These are going to be Dunkin' Donuts/Baskin Robbins stores."
Adding the Baskin Robbins ice cream concept to the stores is cost effective, he says. It adds another $100,000 for extra equipment and the cost of an additional employee.
"Baskin Robbins is still a relatively unknown entity in Florida and overall ice cream doesn't do well in Florida unless you have an attractive location like a mall or St. Armand's Circle," Kaplan says. "But Baskin Robbins really tends to balance out our traffic. Seventy-five percent of Dunkin' Donut's business is done by 11 a.m. We get our nighttime traffic from Baskin Robbins."
The partners plan to build an 8,000-square-foot strip center at Clark Road and Interstate 75, a 4,000-square-foot at Gateway Avenue and Stickney Point Road and a similar small retail center at Bee Ridge Road and Shade Avenue.
Cabral, Millard and Kaplan also will lease space in a new strip center near the Gateway Development at Fruitville Road and I-75.
The new Dunkin' Donuts franchisees also plan to put a Dunkin' Donuts store in the former Basil's Chicken on Tamiami Trail and Waldemere.
"That's a premium spot," Kaplan says. "It's one of the best spots in town. We would be doing that with Firehouse Subs."
Meanwhile Kaplan continues to acquire properties and develop commercial and residential projects. He is an owner or partner in 25 properties, including Banana Bob's Carwash, 8403 S. Tamiami Trail, Sarasota.
He is converting the former auto dealership, at the northeast corner of U.S. 301 and Fruitville Road, into a Chevron gas station. He is leasing the property from the landowner to build the 3,000-square-foot, nine pump station, and the station is in turn being leased out to an operator. The new station will feature a Dunkin' Donuts kiosk.
Kaplan recently closed on a 5,000-square-foot retail building at 402-408 Washington Blvd. N. in downtown Sarasota
In addition, he plans to develop a vacant lot at Ninth Street and U.S. 301, next to a Popeyes Fried Chicken, into a small (6,000- to 7,000-square-foot) retail strip center.
Kaplan is in negotiations with Starbucks to develop and lease the chain its first retail store on the island of Venice.
"That site isn't big enough for us (Dunkin' Donuts)," Kaplan says of the land he owns and plans to use for the Starbucks.
Kaplan also partnered with Florida Sen. Mike Bennett on several commercial and residential properties. The partners recently sold all but one of the 54 homes lots in Hawk's Harbour community across from the airport. The remaining lot is on a six-acre private island and listed at $5 million.
Bennett and Kaplan also own several individual industrial and commercial lots and are considering a condo/hotel project in the Beaver Creek resort area of Avon, Colo. Bennett says the deal is pretty likely.
"Marvin was introduced to me through a mutual friend - Kevin Millard," Bennett says. "It was just happenstance. We also own some vacant land on University Parkway and State Road 64. He's a good partner; he stands by his word. If you have to make a cash call, Marvin is the type of guy that drives the check to you."
Bennett says the two alternate operational duties in each business venture are based on the person who suggests the deal.
Asked about his menagerie of business interests, Kaplan says he usually sees an upside in every deal.
"It's just the amount of marketing that has to be done to make the deal work," he says. "Real estate is pretty much my thing. With the other stuff I really just got sidetracked. You have to look down the road at what is coming. I try to project out two to three years when I'm looking for real estate. You have to look at areas like (U.S.) 301. I think it's going to be swept up in the downtown frenzy."
Next up for Kaplan, among a number of other projects, is trying his hand at building affordable worker housing.
"I am going to just have to look at something that is not very appealing today and wait for the sprawl to get to it," Kaplan says. "You just have to take a chance and use vision. I'm not right all the time; I've been wrong lots of times, but it works."
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