Loading
Developer Goes Solo
By Gaurav Ghose
Staff Writer
As the finishing touches are put on Tampa Gateway Park with the construction of a Hampton Inn & Suites, Frederic M. Archerd Jr. is moving on to his first solo project: a 100-acre residential project in Seffner at the northeast corner of Kingsway Road and U.S. Highway 92.
Fortuitous or not, golf has played a role in what is an emerging real estate development career for Archerd, a 49-year-old Tampa resident.
In 1989, the Swedish developer of the 1,750-acre Cheval golf community in north Tampa hired Archerd, called Fritz by friends, to manage development of the project. His limited real estate experience involved the financial side, working with Arthur Andersen and later with New York-based Turner Equity Corp. and Trammell Crow Co. in Tampa.
At Cheval, he was in charge of operations at two golf courses and a luxury residential development.
At the time, the real estate market was in the dumps and the Gulf War loomed large for the second half of 1990, before it broke out in January 1991. In his first year, Archerd sold only nine lots - poor by any reckoning, he says. But with the war's end, the real estate market picked up.
U.S. Army Gen. Norman Schwarzkopf did Cheval a favor, choosing it as his retirement abode. Then newly-formed Tampa Bay Lightning owner Phil Esposito and 11 other players moved into the community, further elevating Cheval's status. Part of the Veteran's Expressway was completed, making the area much more accessible. The project took off.
Fritz spent seven years overseeing Cheval.
He'd found his niche: assembling experts - civil engineers, geo-technicians, builders and lawyers - and managing them throughout the process, from zoning to design to construction.
He says his expertise in the regulatory process is crucial. "To get permits - to do everything you need to do is time consuming and a lengthy process," he says.
Three days before his stint ended at Cheval in November 1995, Outback Steakhouse founders Chris Sullivan and Bob Basham offered him a position he couldn't refuse: development manager of the Old Memorial Golf Club, which allowed him to work with internationally renowned golf course architect Steve Smyers.
"He was integral to the success of the project," says Smyers. "We had a very tight schedule and he did it in great time. He was the absolute glue bringing together all the different personalities - so many people with different functions working together on the project."
It was Archerd's success in these high-end golf projects that brought him close to some prominent people and established a credibility that has helped him move onto other projects.
He formed his own company, The Archerd Co., in 1995. But working on independent projects was put on hold until he completed the Old Memorial Golf Club project in November of 1997.
Since then, he has continued a combination of his fee-based managerial role on projects and at the same time pursued other projects as principal.
In 1999, he partnered with David Kilcoyne of Kilcoyne Development Corp. on the Tampa Gateway Park, a commercial project off Interstate 4, in which Kilcoyne is the majority equity contributor. The land was acquired, developed and sold to the end users over a period of five years, Fritz says.
The project would have been completed in three years if not for the 9/11 terrorist attacks, he says. The project brought in $12 million, about $4 million more than it cost to buy the land and develop it.
Today, Gateway is a busy interstate interchange: there's the Travel Center, Bob Evans restaurant, Gator Ford, Gator Lincoln-Mercury, both dealerships are owned by Kilcoyne, and the 76-unit Hampton Inn, which is under construction.
All of this is a far cry from the early days of the project when it faced opposition from the surrounding neighborhood residents and activists, Kilcoyne says.
"Putting a project together has become more and more complicated, particularly in Hillsborough," Kilcoyne says. "It's scary. It's very important to bring in expertise to do it successfully and Fritz and I brought together components of that expertise into the project. In that sense, Fritz and I complement each other very, very well."
Not to say the partners had no disagreements.
"I am the visionary," Kilcoyne says, "Fritz is the practical guy. We would disagree, but he would be the one to point out the reality of the situation."
Archerd's personal initiatives, practical to the core, invariably mean working out problems, including those with the neighbors. For instance, Archerd insisted on the installation of street lights at the unsignalled intersection of the interstate and Tampa Gateway Boulevard. The lights silenced some vocal neighborhood activists who had raised the specter of accidents.
In March of this year, Archerd closed the deal on the Seffner residential property for $4.5 million, which he expects, after the add-on costs of land development, will sell for $15 million.
In the local market, there is always a host of other bidders, he says, and "it boils down to the personal relationship between you and the seller and your idea that would make the seller comfortable that you are the guy to develop the property."
For instance, on the Kingsway project, others wanted the seller to sell the commercial property first. But he approached it the other way. While agreeing to zone the entire property, he told the seller he would do only the residential project, which would make the commercial part much more valuable later. It was a prospect that appealed to the seller, who chose him over others.
On the Kingsway project, he hired Heidt Associates to design and work on the engineering and Evergreen Co., which worked on Tampa Gateway Park, to be the general contractor.
"I'd rather go and hire the best group of people for the function and you pay them for that and that's fair," he says.
Archerd faced opposition to the 300-lot Kingsway subdivision, he says, even though the land is in the urban service area and the future land was designated as 4 units per acre.
"The community residents were living out there with this beautiful orange grove around them and let me tell you when that orange grove blooms that whole area smells great - they are going to lose that," he says. "On the other hand when we finally got it approved we had scaled the project back to a level that was a fraction of what could have been allowed."
While working on Tampa Gateway Park, he was also involved as a fee-based real estate project manager with the development of the junior high section for Independent Day School in Carrollwood and Van Dyke Estates, Kilcoyne's 44-lot single-family subdivision project on Van Dyke Road.
While the most difficult part of the Kingsway project is done - putting the land under contract, going through the design/permitting process and convincing the builders, Inland Homes and William Ryan Homes, of the potential, there will be more hurdles when it comes to putting in the streets, water and sewer and easements before he sells the finished lots to the builders.
While he manages his solo project, he is also working with Pepin Distribution Co. - the largest distributor of Budweiser in Tampa - on a new 250,000-square-foot distribution facility on 50th Street at Martin Luther King Boulevard.
In this project, with the zoning issue resolved by the company and the permit issued, it'll be Archerd's job to find a contractor and oversee the financial side. His experience, including his years with Arthur Andersen LLP, Tampa, help in that regard.
As for the real estate market in the Tampa Bay area, he says the biggest challenge is always finding the next project. He has two pieces of property in the pipeline, which he wouldn't yet discuss.
"Between competition with the involvement of the builders in the development side of the business and the regulatory environment becoming tougher and tougher," he says, it's difficult to "find good projects that make sense and on which you can safely make money on."
But all is not bleak.
"The good news is banks need enough cash equity in your real estate deal and they are not over lending," he says. "The regulatory environment, while too slow for my taste, has kept the situation in equilibrium and we have not gotten too far out of whack as a consequence."
Your free article limit has been reached this month.
Subscribe now for unlimited digital access to our award-winning business news.
Join thousands of executives who rely on us for insights spanning Tampa Bay to Naples.
