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People to Watch
By Kendall Jones
Contributing Editor
It must be a testament to our business environment. The Gulf Coast is growing, becoming more technologically savvy, more competitive and open to new opportunities.
Who will make the most of this?
We looked for 10 business people to watch, people who would face significant challenges this year. We sought those who made a splash in 2004 to see whether they could keep it up this year. Then we had to cut the list in half - a couple of times.
Admittedly, we left out some fascinating people - will DVA Sports' Sal Diaz-Verson and Larry Kish change the dynamics of East County with their hockey arena? Will Coldwell Banker Realtor Barbara Ackerman break the $100 million sales barrier? Will restaurateur Paul Mattison open more restaurants?
They're people to watch, to be sure. But here are 10 others to keep your eyes on for 2005:
Bob Richardson
This longtime Sarasota commercial real estate broker/developer has taken on a big challenge this year: saving and bolstering the Downtown Partnership of Sarasota Inc. When the DTP's former Executive Director John Tylee left in December with little warning, Sarasota business people gasped. The Downtown Partnership was losing its visionary, big picture thinker, mediator and money-maker.
Enter Richardson, president and founder of 33-year-old Richardson Kleiber Walter, former president of the Greater Sarasota Chamber of Commerce and former chair and/or board member of at least a half-dozen charitable and civic organizations. Richardson is not one to shy from challenge. After Meg Lowman's contract was not renewed at the Marie Selby Botanical Gardens, he resigned from Selby's board and asked the Florida attorney general to investigate the institution.
But the DTP may be Richardson's biggest challenge yet. Not only does the group lack a leader, it lacks cash. While the DTP conducts a search for a new executive director, Richardson, immediate past chairman of the DTP board, has agreed to serve as interim executive director, hoping to provide some continuity. As for money, the DTP required a private sponsor to fly Tylee back from Vancouver to facilitate the Retail Forum due to limited cash reserves. Richardson will be the point man for fund-raising efforts. If the well-attended annual dinner and Retail Forum was any indication, Richardson is off to a good start.
Wayne Morehead
His Boulevard project was a flop. Morehead had planned to develop a higher-end, mostly condo project at the intersection of Boulevard of the Arts and Florida Avenue. It was Morehead's first residential real estate development. The project was in the not-quite-there-yet Rosemary District, yet priced as high as its better-situated competitors. As a result, it failed.
But now Morehead is back. He has bought almost all of the property cattycorner from the Boulevard property - about seven acres. He has planned CityPointe, a mixed-use project that will include "affordable" units and no pricey penthouses. The project will target young professionals and the working class.
Morehead will be the first to admit he learned a lot from his experience with The Boulevard. He has a new team, renewed confidence and has cleared some important hurdles at City Hall. Morehead says he has collected a list of potential buyers twice as long as the number of available units, and he hasn't even opened a sales office yet.
Tim Clarke
Tim Clarke has proven himself a successful warrior. Though battle-scarred, he has managed to maintain a sense of humor and genuine devotion to Sarasota. He started Clarke Advertising and Public Relations in 1987 and grew it into the largest agency in Southwest Florida, with more than $20 million in annual billings. Earlier this month, Clarke officially sold ownership (and turned over daily operations) of the firm to three of his senior managers; he's staying on as chairman and consultant.
Clarke was also one of the founding directors of Sarasota Bank, which sold about a year ago to Colonial Bank for a handsome return in investment. Only a couple of months ago, he stepped down as chairman of the Greater Sarasota Chamber of Commerce, having served 18 months in that role. During his tenure, Clarke led the chamber through the toughest of times, from the termination of one executive director and searching for and hiring a new one, to dragging the chamber's operations from a loss to a surplus.
This year Clarke is putting on his hard hat to face one of his toughest challenges yet - the chamber's efforts to build a conference center in Sarasota. Clarke has an uphill battle - there's still no land designated for it, nor is there a fund-raising mechanism in place to pay for it. Watch for a big step on Jan. 31. Clarke is on the agenda for the 3 p.m. joint meeting of the city and county commissions.
Bill Merill
When it comes to legal issues relating to development, zoning and land use in Sarasota County, Merrill is always in the top tier. This partner with Icard Merrill Cullis Timm Furen & Ginsburg has been the legal face on more than one clash between the real estate/development community, whom he represents, and government. This year, Merrill will be front and center on two matters of long-term significance.
First, Merrill is the legal eagle on the team of those in the development community - architects, Realtors, developers, builders, etc. - who are taking aim at the implementation of the Sarasota Downtown Code and its attendant rezonings. While real estate professionals such as Bruce Franklin, Joel Freedman, Ian Black and John Harshman talk about the impact of the rezonings on property values and alternatives to the rezonings, Merrill focuses on the legal issues. Particularly, he is concerned that affected property owners have not received adequate notice regarding the rezonings and that the city commission is not utilizing the proper constitutional format to effectuate them. As the result of efforts by Merrill and others, the city has delayed the rezonings.
Second, Merrill is the attorney of record for Siesta Key property owner Tom Rice, whose personal battle with Sarasota County on the issue of property rights has far-reaching implications. Rice has been unable to get a variance to put a beachfront home on his property, despite extensive negotiations and agreements with county representatives, despite the fact that the county has issued similar variances to similar properties and despite having spent more than $100,000 in legal fees pursuing the matter. If Rice and Merrill pursue this in court this year, the consequences of that litigation could have a major impact on property rights in this county as well as nationwide.
Dori Rath
She holds a black belt in martial arts. Not long ago, the 39-year-old entrepreneur won two gold medals in St. Petersburg, Russia, at an International Martial Arts Festival, and she's a U.S. National Champion in Forms and Weapons.
But that's not why you shouldn't mess with Dori Rath. This is a shrewd businesswoman.
About three years ago, Rath became president of Bradenton-based The NELCO Companies, succeeding her mother and company founder, Virginia Dorris. Since Rath became president, NELCO's revenue increased by more than 86% ($27 million, 2003) and net profitability increased by more than 82%. NELCO has acquired six human resource outsourcing competitors in three years, placing NELCO in the top 20 PEOs in the country.
Though the company has employees in 44 states, it only has satellite offices in a few states. That's going to change in 2005, when the company will expand into additional states, including Texas, with additional satellite offices. Preparing for the impact of that growth on the home office, the company is also doubling its office space at Pinnacle Office Park in downtown Bradenton.
In 2005, Rath is also going to bring management of all workers' comp claims back in-house - those services have been outsourced for a couple of years. Rath says that in-house servicing of claims results in better care and treatment of employees (who don't then run off to attorneys so frequently in anger), better loss ratios and more aggressive pursuit of fraudulent claims. It will also save the company about $2 million annually.
Also in 2005, a company co-launched by Rath will gain its foothold. The company is Teen Arrive Alive, a family-focused safety company that, among other elements, includes a cell-phone based GPS location program that helps parents monitor young drivers or locate a lost, missing or abducted child. The company launched last year, and it already saved its first child, a 16-year-old in Houston who was being detained by a known pedophile. The system is already available through Nextel, but more carriers will be added this year.
Tim Roberts
It's the day of reckoning for Infinium CEO Tim Roberts. Infinium and Roberts have hyped the Phantom Game Service and console for two years, constantly promising it will be out in a few more months. It was going to launch in early- to mid-2004, then in November 2004, then in March 2005. Now the company promises to introduce it in the "second quarter" of 2005.
Meanwhile, hoards of cynics, especially in the high-tech gaming world, have suggested that the Phantom is just that - nonexistent, "vaporware." They have dedicated entire Web sites to those claims, such as www.whereisphantom.com.
And oh, the lawsuits. At least four different lawsuits were filed against Infinium in the last year, with claims ranging from breach of contract to fraud. One lawsuit was a declaratory action, filed by a high-tech online entity called HardOCP.com because Infinium was threatening HardOCP with litigation over an article it wrote questioning the integrity of Infinium, the Phantom and Roberts. The court granted that declaratory action to HardOCP. Sarasota law firm Icard Merrill represented Infinium until recently, when that relationship ended.
Still, many tech and gaming writers who have seen the Phantom seem impressed. Thousands of attendees saw and experienced it at the popular Consumer Electronics Show in Las Vegas in January. And Infinium has mastered the art of getting press for itself. The revenue and profit model is still a little sketchy - in July 2003, Roberts told one reporter that the units would sell for $400 each, plus subscribers would pay $9.95 a month for the service, and he would need at least 750,000 to one million subscribers before his company would turn a profit. In September 2004, reports said the company needed $68 million to continue to stay afloat through 2006, though Roberts predicted the company would realize $35 million in revenues in the first year after the release of the Phantom, whenever that is.
Stephen Julius
This 45-year-old Anglo-Italian financier has pulled Sarasota-based boat builder Chris-Craft out of Chapter 11 bankruptcy in the last four years. When Julius bought Chris-Craft for a bargain price, it was only a licensee of its own brand name, which actually was owned by Rupert Murdoch's media company. In 2001, Julius bought the brand back from Murdoch and reunited it with the Sarasota-based boatyard assets. He recruited his pal and former Harvard Business School classmate Stephen Heese to become company president (Julius is chairman), and the two men scrapped everything in the yard, which had been closed and defunct for more than nine months. They started over from scratch, designing new models and lines based on the original theories and values established by Chris-Craft founder, Chris Smith, 130 years ago.
Julius' plan to re-launch the company is working. Last fall at a boat show in Fort Lauderdale, the company unveiled its $372,000, 36-foot "Corsaire," an elegant "runabout" that is leading the new Chris-Craft line. The company is displaying its new wares at 15 different boat shows in January 2005 alone. Julius is managing to restore to Chris-Craft the excellent reputation and prestige it previously enjoyed but had lost in the 1990s due to poor management decisions and a dip in the boating industry overall. This year will really tell the story of Julius' success in returning Chris-Craft to glory.
Julius, primarily based in London, has done this sort of thing before. Prior to purchasing Chris-Craft, he had breathed new life into Cantieri Riva, a famed Italian manufacturer of deluxe boats. Riva had also been in financial trouble, but it had the foundation of a well-respected brand; Julius calls the Riva and Chris-Craft brand names "iconic." Like Chris-Craft, Riva had become the victim of poor management. Julius bought Riva at fire sale prices, did a clean sweep and restored it to its boating industry pedestal before selling it and moving on to undertake a similar effort with Chris-Craft.
Brian Peters
Brian Peters might become a community banking legend. He became president and CEO of Bradenton-based Coast Bank of Florida and its holding company, Coast Financial Holdings Inc., in February 2004. He was promoted from his job as executive vice president/CFO of the bank - a job he had held less than two years - to make Coast profitable. The bank had been losing money ($1.7 million in 2003).
By June, Peters had sold off a $112 million portfolio of residential servicing for approximately book value, an effort to minimize interest rate losses. He then sold off the bank's merchant and credit card operations, considered riskier than traditional commercial banking lines. Next, he outsourced the data processing and item processing. He wanted to narrow the focus of the bank to the tried-and-true commercial banking focuses of deposits and loans.
It worked, and it worked fast. By the end of 2004, less than one year after Peters took over, Coast Bank reported a 39% increase in loans, a 57% increase in deposits and a 54% increase in net interest income for 2004. For the first time in its history, Coast reported a profit in 2004 - net income of $831,000.
In 2005, Peters will build on this success by opening four new branches, all in Pinellas County. Peters sees Pinellas as the right market for Coast Bank because bank mergers have left that area with few true community bank options. The bank has already hired staff for these locations, which are expected to open in the first half of the year. The bank's fresh start is reflected in its new logo, which adds color and emphasizes the "Florida" part of the bank's name.
Brandyn Herbold/Chad Roffers
When Herbold and Roffers formed Sky Real Estate a year ago, they did not sneak on to the real estate scene. These two Realtors, both formerly fast-rising producers with Michael Saunders & Co., opened for business with a splash.
From a unique ad campaign featuring the company's clients, to making sure they appear at - and sponsor - many local events, Herbold and Roffers wanted to make sure SKY Real Estate was visible.
Apparently, the strategy worked. Herbold and Roffers report that SKY sold more than $100 million in residential real estate its first year, growing from three to 13 sales associates in one year.
In 2002, Herbold opened brandyn & co., which generated $20 million in gross sales its first year. Before opening SKY, Roffers had been a $20 million producer himself with Michael Saunders & Co., and prior to that, he had been putting his MBA to work with Ad Auction, Cendant and U.S. West Dex (now Qwest), where he negotiated transactions with AOL Time Warner, Yahoo and Palm.
In November, the pair bought an affiliation with Sotheby's International Realty, a coveted connection previously held by their former employer, Michael Saunders.
This year, Sky Sotheby's is tripling its office space. The new offices will feature meeting rooms with high-definition plasma displays of virtual home tours. The company will continue to stay on the technological front line; it provides its associates with BlackBerrys that give access to the MLS service and the ability to post new listings while in the field. In addition, the company is implementing a complimentary home staging service, a California trend that helps homes look their best for a faster, more profitable sale.
Herbold and Roffers predict that SKY's 2005 sales volume will increase 100% this year, based on projects in the pipeline and expansion plans.
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