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Driving the S.S. Appel
By Sean Roth
Real Estate Editor
For 57 years, S.S Appel & Co. was Stanley Appel. He has bought, sold and developed hotels worldwide for half a century. But now the 82-year-old businessman has picked a successor.
Art Eckert, with a background in technology and business management, began learning the Appel real estate method shortly after moving to Sarasota two years ago. The $21-million San Marco Plaza at Lakewood Ranch and the $76-million Sonesta Legacy Resort and Spa are projects Eckert is backing and managing. As S.S. Appel president and managing partner, Eckert plans to make the company name more recognizable, locally and nationally.
Key among Eckert's expansion plans for S.S. Appel is the development of a three-star hotel chain, ManorHouse International. Eckert plans to develop the first ManorHouse Inn & Suites west of Interstate 75, just off State Road 70, in Manatee County.
A second 80-room hotel is planned for Naples, and S. S. Appel & Co. is gearing up to open at least five ManorHouses in the next three years.
"We will own the buildings and property and outsource the management, at least initially," Eckert says. "The ManorHouse will be a limited service hotel that will have meeting space. There is going to be a lady and lord of the manor. It will also have limited food service."
The business plan calls for the company to sell the top level of the three-floor hotel as corporate suites with kitchens.
"This alleviates some of the cost of travel for businesses," Eckert says. "It also puts assets on the books for these companies that they can depreciate. We think it's a pretty good deal. They know they can get a room when they're in the area, and we can lease it out for them to offset the cost of these units."
S.S. Appel has a contract on the first site, and Sarasota-based Hoyt Architects is finalizing the architectural design for the Mount Vernon-style buildings, he says. Hoyt is also a partner in the venture.
"This is still pretty much in the conceptual stage," Eckert says. "We are looking for sites in light industrial areas with heavy road traffic and university environments, such as Gainesville and Tallahassee."
On top of the hotel venture, Eckert has devised a business strategy for S.S. Appel to extend its future business lines based around its two Lakewood Ranch ventures.
On the retail front, construction of the 65,000-square-foot San Marco Plaza is set to kick off in August for a late '05 or early '06 completion date. The Venetian-style development, originally proposed as 90,000 square feet with a 250-seat outdoor amphitheater, will feature about 10,000 square feet of office space and a new theater run by the owners of Sarasota's Golden Apple Dinner Theatre.
As for S.S. Appel's future in retail, Eckert plans to develop a second phase of retail office and restaurant space, 800,000 square feet, at the northwest corner of Town Center Parkway and Natures Way, near San Marco. At the same time, S.S. Appel's staff is looking for other retail development sites in the state.
The third business line of interest to Eckert is the growth of the four-star resort development similar to what his company is proposing at the Legacy Golf Club in Lakewood Ranch. S.S. Appel has a contract to acquire the clubhouse and golf course facilities from Scottsdale, Ariz.-based golf course operator Troon Golf. While some specifics have yet to be worked out, Eckert and his staff plan to develop a total of six new condo-hotel buildings (216 residential units) surrounding a new clubhouse.
"It's going to have a bistro with a piano bar and grill, a cultural center, a European spa and a rainforest pool," Eckert says. "We are also upgrading the golf course. Nothing has been finalized, but we are already in talks to have some tournament play here."
Appel's initial plans were scaled back because of community concerns, he says.
"We are really going to be improving the property values of homeowners by giving them waterfront views," he adds. "Instead of having a waste bunker area in the backyard they're going to have water. We're also buffering some of the traffic generated by University (Parkway)."
The redevelopment of the golf course is projected to cost about $1.5 million.
Eckert is working with Sonesta Hotels, the management company that will be in charge of resort operations at the Legacy, to find additional sites for new four- or five-star hotels. Most of the company's focus has been centered on Florida, but S.S. Appel is also considering a location in Manhattan.
As for the relationship between Eckert and Appel, besides an obvious mutual appreciation they share a link to New York City.
"We both grew up in the Bronx," Eckert says. "We covered a lot of the same real estate. Stanley was usually just there a few years ahead of me. After I met him, I learned that Stanley had parceled out the site where I built my house in Westchester."
Eckert's ties to real estate are long.
"My family has been involved in real estate for many years," Eckert says. "They own about 22 apartment buildings in New York. They run construction and management firms."
But Eckert primarily made his mark in technology.
After college, he taught microprocessor technology to the engineering employees at North American Phillips. In May 1983, Eckert was hired as a regional specialist for the eastern region of early computer communication company Protocol Computers Inc. He helped Protocol complete its IPO, and in October 1985, he resigned to started Eckert Consulting Inc.
"I landed a number of big accounts, including Merrill Lynch, American Express and MTV/Viacom," Eckert says. "For Merrill Lynch, I converted their retail brokerage firms to a new trading platform. For MTV, I automated their Nielsen Ratings information. Advertising dollars are so closely linked to viewership; it determines their entire base rates."
Eckert's consulting work for Manufacturers Hanover Corp. led to a job with the company as vice president of trading floor technology. He managed the development of seven new trading floors in North America.
In 1995, Eckert was promoted to vice president of research and development for Chase Manhattan Bank (Manufacturers Hanover after its merger with both Chemical Bank and Chase Manhattan). He obtained seven patents for the bank.
At the height of the dot.com boom, Eckert managed the New York/New Jersey regional offices of USWeb/MarchFirst.
In late 1998, Eckert opened and managed two offices for the business network company Predictive Systems. In nine months, the offices went from nothing to $1.4 million in revenue, he says.
After Predictive Systems went public in October 1999, Eckert joined financial information technology startup ThruPoint Inc. as vice president. He opened offices in Beijing, Shanghai, Gaungzhou and Hong Kong.
Then in 2003, Eckert gave it all up.
Doctors told him and his wife that their youngest son, Brett, had asthma so severe it was in the boy's best interest to move to a warmer climate.
"He suggested three states: South Carolina, Georgia and Florida," Eckert says. "My wife, who's a school teacher, looked for school systems that were comparable to where the kids were currently going. We eventually found five, and two were in Sarasota."
Eckert quit his job, sold his house in New York and moved to a home in Palmer Ranch.
One of his friends, Joseph Kaminski, general manager for Trump Park Avenue, suggested he look up Appel, who lived in Lakewood Ranch. The two met and Eckert wound up investing in S.S. Appel.
"What initially struck me was just how talented he was," Appel says of Eckert. "Even when we were just negotiating the deal, he was asking questions that the average investor wouldn't know to ask. 'What are the comparables?' - questions like that."
Appel declined to specify Ecker's initial investment, except to say it was in the high six figures.
Health problems precipitated Appel's handover of the reins. He has had two back surgeries.
With Eckert in charge, the management change among other S.S. Appel executives will likely occur over the next year as Eckert brings on his own people, Appel says.
"This will allow me to phase more into a consulting position," Appel says.
But will Appel remain in retirement? He admits this is his third attempt to slow down.
As for Appel's legacy, aside from continued interest in six hotel properties, he says it will likely be the Legacy Golf Club redevelopment.
"I think that will really be something to be proud of," he says. "That and the many friendships we have created because of what we are bringing to Lakewood Ranch."
Appel's choice is especially interesting given the early controversy the Legacy faced.
"It was just fear of the unknown," Eckert says. "Some of the residents caught wind that we were in discussions with Troon. They had a committee to stop the sale even before we had told anyone what we were doing. The worst rumor I heard was that we were going to build a 7-Eleven there. But they're a pretty reasonable group. Once we had a chance to tell them the plan, they've been pretty supportive."
That experience has Eckert considering the creation of an in-house marketing department.
On the topic of whether the company has additional developments planned for Lakewood Ranch, Eckert says nothing is finalized, but the market is obviously attractive.
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