Australian Entertainment Company with Nichole Popovics
Guest: Nichole Popovics
Topics: The Shopping Center Group, entertainment company, brokerage
Transcript:
Chris Ressa 0:00
This is Retail Retold, the story of how that store ended up in your neighborhood. I’m your host, Chris Ressa, and I invite you to join my conversation with some of the retail industry’s biggest influencers. This podcast is brought to you by DLC Management.
Welcome to Retail Retold everyone. Today I am joined by Nicole Popovics. Nicole is the EVP and Managing Director of The Shopping Center Group. I’m excited for her to be here. Welcome to the show, Nicole
Nichole Popovics 0:32
Hey, Chris, thanks so much for having me.
Ressa 0:36
No problem. excited that you’re here. Nicole, why don’t you tell everybody a little bit about who you are and what you do.
Popovics 0:44
Perfect. Absolutely. So I got started in the business about 20 years ago out of college at Florida State University. And I was a real estate major. And they did on campus interviews. So originally, I thought I was going into lending on the commercial side, when I had a developer approach me. And one of his questions was, do you like to shop? And I sat there and I was like, does a one legged duck swim in circles? Absolutely. I love to shop. That’s my hobby. I’m really good at it.
So from there, he flew me down to Boca and I interviewed with Woolbright Development and got the job as a leasing assistant, spent probably about five or six years there and learned the business, door knocked every day and then ultimately was leasing a shopping center on my own. And a few years in, I moved to Omaha for a little bit and was able to work for another developer out there, which was great experience.
He was doing lifestyle centers through the Midwest and just really a different type of product than what I was leasing at Woolbright. Then I decided to come back home, which is in Tampa, and started working with Equity One. So I went on to the REIT side of the business. I did leasing for Equity One and then they sold a portion to Brixmor, so went there, went back to Equity One.
And then ultimately they sold to Region, at that point, and then decided to take a leap into management and was the head of leasing for the assembler company out of St. Petersburg. They do Publix anchored shopping centers. So with leading up the leasing team throughout the whole Southeast. And then one day, I got a call from the Shopping Center Group and they said, hey, you have a depth of knowledge of tenants?
Would you be interested in heading up our tenant rep team? And I said, that’s really interesting to go from landlord developer side of the business to the brokerage side of the business, and on the tenant side, which I have not really done. And so after multiple conversations, I found that it was the right role for me, it’s, you know, talking with tenants every day, understanding their expansion plans, and really helping grow the tenant rent business for the Shopping Center Group. So that’s what I’m doing today. And I absolutely love it.
Ressa 3:26
Amazing. So curious on the, a bunch of the career moves. So one, on that The Shopping Center Group one, which is, as you pointed out, a little bit of a different role than you’ve had in the past.
Did you, when they reached out to you, was that a relationship? I think it’d be helpful to the audience, or like, did they just know of you and read and a recruiter called you, someone you knew who reached out to you?
Popovics 3:59
So it was through a recruiter that I’m really good friends with. Yeah, David Polian. So he reached out and he said, listen, this kind of checks the mark on some of the things that you really love about our business. And he’s like, do you want to see if this would be a good fit? And he was right. He knows me very well and just really understood kind of where I would like my career to go.
Ressa 4:24
Got it. And this is your first foray on the brokerage side of the business, right? You’ve been on some form of landlord ownership, whether it was a public REIT or private. This is your first foray on the brokerage side. How’s that?
Popovics 4:40
It’s fun. It’s interesting, and there’s a lot of similarities and you know, the companies all run very, very similar but you know, ideal on a day to day with W2 employees and 1099 employees. So, obviously 1099 are the brokers, the W2 are you work for us in house and just the personalities are a little bit different for1099, half, two, you know, you eat what you kill. And so they’re very aggressive with what they want. And it’s exciting to help them pick up more clients and go after targeted clients that they’ve seen in other markets.
Ressa 5:16
So how many people are on your team now that you run that 10 reps? How big is this team?
Popovics 5:24
So we are about a little over 100 brokers and I work with predominantly the tenant rep side, so about half of that. And then I try to work with most of our internal staff just as I pop through all of the offices. But I would say majority of my time is spent with our brokers throughout the whole footprint.
Ressa 5:47
And I think people are learning, so what is Nicole’s job? What are you doing? What’s the day to day look like for you?
Popovics 5:57
Sure. So day to day, the majority of my time is sourcing new business. So I need to know what the new concept is either coming to the US or coming from West Coast to East Coast, or coming from north to south, I need to know those businesses, and I need to know those people. And we want to try to pick up more representation through the footprint.
And the other part of it is helping our team, our brokerage team in collaborating with each office and collaborating with the teams and getting to know making sure you know, you know, everything going on in the market and really helping solve if there’s any problems with a commission agreement, or municipalities or with an existing client or, you know, really a slew of any of the things that come up day to day in our brokers world, I will help them out.
Ressa 6:56
Got it. The when you’re when you’re talking about like the the primary of sourcing new business for the group is is there a type of tenant or a profile that lends itself more for you guys than someone else?
Popovics 7:17
I would tell you, we are obviously looking for some of the corporate docs, drivers of what may be next to the market, right? A lot of people recently have talked about recession, and what are the types of tenants going forward that are going to be expanding in a market that way we may be coming into, or what has been popular through COVID. That’s still existing today. So you take a look at how many people bought animals during.
So veterinarians are growing and pet stores are growing, because there’s been such a demand with everyone getting an animal during COVID. So we’re taking a look at maybe before it becomes mainstream, and what are some of the digitally native brands that could come offline into brick and mortar.
And some of the restaurants where we’ve seen have maybe three or four in LA, would they lend themselves to a New York or Miami with similar demographics. So I kind of do a lot of research on that aspect every day, and then start to reach out and kind of get some momentum.
Ressa 8:35
And would you say, so you mentioned a lot of hot new trends. Would you say that? Let’s I’ll use a big example. You will spend your more time with someone like I don’t know, a tenant like Ross Ross Dress For Less is not in every state. So talking to them about, you know, choosing your group when they come into the markets that you focus in.
Or more of your time with the restaurant who’s got eight locations in Atlanta, you heard a whisper that they might be thinking about going into Florida, and you know want to do 10 locations in Florida, that tenant.
Popovics 9:20
Oh, that’s a tough one. I would almost tell you against 5050 down the middle, right. So I’m going to use our resources in house so who has the best relationship with either Ross? In which they? Yeah, no, listen, they’re they’re a great client. Should I use someone like them who has relationships and have the relationship person continue that conversation and Lumigan throughout, and then maybe I’m digging into the cold lien and finding out who has the best contact?
So I really am trying to undo the web, who find out who has the That’s relationship and in conjunction with them, we team up and try to go after the account.
Ressa 10:06
Got it? Okay. Well, speaking of that,
Popovics 10:10
you know the business, it’s all about relationships.
Ressa 10:13
So speaking of that, you you have a story about an account that we can’t necessarily name, but it’s an international to domestic. So So I think that does bring some level of interest to the audience. And so why don’t you tell us about that?
Popovics 10:34
Sure. So we’re working with a client right now entertainment based out of Australia. And we all know Entertainment has truly exploded, with everyone coming out of COVID. And wanting to have face to face interaction and do things as a family or as a team, and really getting back together. So the the group that we’re working with has nine unique concepts. And what they’re doing is growing a portion of that company into the states with a number of locations.
So anywhere from New York to LA to Dallas to Chicago, it really is a nationwide expansion. And what I love about the account is, and I’ve never done a national expansion, I’ll be very honest and upfront about that. So it is opened my eyes to a bunch of different cities, people. Just different aspects, right. So you’ve got to translate the Australian dollar to the US dollar, square footage and meters are different construction costs, timing and permitting.
Taxes, all of these things are very, very different in the US and learning how somebody does it in a different country. And how we do it. It’s just been mind blowing, and really exciting to see them come in and get their first ones underway, which hopefully you’ll see in mid 23.
Ressa 12:10
Very cool. So, you know, we were talking about landing accounts before how did this account get landed.
Popovics 12:18
So this was through relationship at our, with our CEO, you went to a conference in LA called the triple E conferences, the entertainment Evolution Conference, I believe is what they call themselves and just happened to be sitting next to a nice lady made an intro. And it really stuck from there. Just kind of getting to know that person and building the rapport.
And so they were originally going to come in prior to COVID. Obviously, with everything shutting down, they paused on that. And then earlier this year, they came back and we met them back at the conference. And they’re like, we’re ready to rock and roll. So it all started with a simple Hello.
Ressa 13:07
Well, the one thing I will say is in a world where we were shut down, it speaks to the validity of in person conferences. So I really, I love that it started at a conference because we’re back into conferences I’ve got between September and October, I’ve got four coming up. Different conferences, summer ICSE. Summer not.
And it’s exciting to hear stories of business getting generated out of conferences, in a world where people are like, you know, in 2020, we don’t have to travel anymore, we’ll just do everything over teams or zoom. So that is refreshing to hear. For sure. And I think it’s pretty exciting.
Popovics 13:56
I think, yes. Can we do a lot of things over zoom? Absolutely. But there is just something about human interaction that fills the soul. And I think we all need it.
Ressa 14:10
I wonder, there’s been a bunch of what I’ll call retailers that don’t do business in the United States that have come over to the United States, whether you know, some big ones that come to mind are like h&m and Zara, have you reached out to any of the people who work on those accounts or anything to see some of the, you know, hurdles and whatnot that they’ve dealt with in, you know, trying to translate ideas into reality.
Popovics 14:45
So we’ve looped in some consultants who have done that translation to help with and you know, for whether it’s an attorney or an architect or GC, but from a dealmaker standpoint, we do have symbol Well, partners that we work with. And they’ve been able to offer some intel on that. And it really is interesting the amount of concepts that you can find in you know, let’s call it London or wherever else across the world, that would be a great fit here.
Ressa 15:17
So what are you excited about with this concept from like, what they actually do from that they’ve nine concepts, but for this business, that can be a little differentiating in the US.
Popovics 15:31
They know entertainment, they’ve been doing it for 20 years, and they are on the cutting edge of some entertainment concepts that are not here in the US. And I think that’s going to excite the consumer. And you know, whether it’s a family with kids, or it’s for a business team building event, they appeal to all ages. So you can take an eight year old or you can take an 80 year old and there’s going to be something for them to do and do it together and have fun doing it.
Ressa 16:08
Very cool. How big? How big do you think you can get in the US? Is this a? Is this a top golf where there’s like limit? You know, there’s maybe one or two in a market? Or is this Chucky Cheese where there’s 1000?
Popovics 16:27
I would say there’s multiple I think you’re gonna see a few 100 over time.
Ressa 16:31
Wow, exciting stuff.
Popovics 16:35
It’s, it’s me, right? Like, it’s just, it’s something new entertainment is fun. And it really can transform. And it’s it’s a use that a lot of owners are looking for to help bring this shopping center to light. Sure.
Ressa 16:53
Well, excited for you. I hope it is a smashing success. But you mentioned, you know, it could get to hundreds. Which brings me to the next part of the conversation, which is what’s your take on the you’ve been around the ownership, different types of ownership, the tenant side brokerage landlord, and you’ve seen the explosion in South Florida?
What’s your take on the on the state of the market right now? Because you mentioned the dirty word recession. And then, but you know, we’re also we’re talking about massive expansion. What? Walk us through what you’re seeing from a high level, and we’ll dig in on what you’re seeing in the market today.
Popovics 17:41
Sure, I mean, listen, there’s a ton of disruption in our business, whether it’s from gas prices, inflation, and supply chain construction costs, these are all things we hear every
Ressa 17:50
gas prices, what’s going on with that.
Popovics 17:53
What are you talking about? Listen, they came down today? No, it’s, we operate. When there’s disruption, we find solutions, I don’t know that there would be retail without disruption. There’s, we get creative. And this is when we find out who the real players are in the market. And this is when people you know, sort of change themselves. Look at you know, what happened during COVID.
And people going into convenience, more convenience, more drive throughs more pickup, you know, these are all things where we were sort of heading, but it made it happen pretty quickly. So I would say, Listen, there’s going to be some disruption, there’s going to be you’re going to hear some negativity. But for the most part, some of this needs to happen in order to continue to go forward. You know, a lot of the news headlines talk about closures and what have you.
But they don’t talk about the Austin relocation that they did because they closed the other store. Right? You know, you don’t necessarily hear all about that. And I think you’re gonna see a lot of people taking advantage of good real estate. And I deal a lot in the southeast, and it’s still pretty high. Yeah, for sure. So I don’t know the rest session, if so called recession if there is one I think will be very different than what we’ve seen in the past.
Ressa 19:21
So one question I forgot to ask how this tenant that you’re from Australia, how big are they?
Popovics 19:27
15 to 50,000 square
Ressa 19:29
meters. Just kidding.
Just kidding. Okay, so 15 to 50. Okay, wide ranging. And is there a type of like, product that they like to go into? The grocery anchored lifestyle would
Popovics 19:54
be around food and beverage and other entertainment users. Got it. They target towards the millennials annual population got
Ressa 20:02
it? Okay. All right. So the you mentioned that you didn’t think this recession was be as bad and there’s been an explosion in the market still hot. So when you say the markets hot, what is what, uh, what do you mean by that?
Popovics 20:24
So we’re still seeing a number of tenants, I would say most of the tenants have aggressive growth strategy, and still having difficulty finding space and high rise. So we just this past week, have had a few conversations where retailers said, maybe we’re gonna take another look and slow down a little bit, but I would say that was one out of 100. And it has not been the dominant conversation.
Ressa 20:54
Yeah, the same. And the thing that I talk about a lot, is that I think, from a shopping center and a retail perspective, the industry the fundamentals are strong as they’ve ever been. Which, if you’re going into a downturn coming from a strong position is definitely better than coming from a weaker position. The the I think one, I think the the tailwind. Is this this notion of E commerce versus brick and mortar. Our CEO admission as a quote is that he says, You can’t can’t You can’t make money in clicks without the bricks.
So I think that’s the tailwind. That’s not the headwind anymore. And headline news wants to put that it’s a headwind. It’s just not true anymore. And I think, you know, if you look a lot of the tired, less relevant brands, I think one of the things that we don’t talk about enough is like our industry took its medicine, pre pandemic, whether it was Sports Authority, toys, R Us, JC Penney, and Sears, borders, linens and things, sharper image.
A lot of these, we took our medicine, pre pandemic, and then, you know, coming out of the pandemic, we filled a lot of that space, as an industry. And I think that’s with hot, relevant, fundamentally sound retailers, which I think is a good position to be in going into any potential downturn in, in the economy. So, you know, in there’s obviously this supply constrained environment that you talked about because of the lease up because of the lack of new development.
And one of the things we used to say we were over stored. and the EU, a lot of a lot of what’s happened is a lot of retail space in America has been repurposed for other uses. So there’s no new construction space, at least existing space got least and less functional space is being or has been repurposed, which, you know, is making the fundamental real estate pretty strong. And I think contrary to some headline news, so I’m excited to see what what happens, right.
Like, you know, we have centers that we own like that, in every recession we went in was like, they were like, they were always like 83 84%, occupied. We’re now that center, if we’re going in, it’s like 95%, occupied with healthier retailers and a renovation and remodeled stores. And we’re just in a different place than we were going into those times, you know, 1020 years ago. So time will tell, but I am pretty bullish on the foundation and the fundamentals of the industry right now.
Popovics 24:00
I would agree on 100%. I think the interesting thing about the repurpose comment is how many times I’ve been traveling recently, where someone’s like, Oh, they’re gonna take that down and put multifamily Oh, they’re gonna take that down and do a medical building.
It’s pretty fascinating to see where, you know, we use, we called ourselves to the Shopping Center Group, and we rebranded to TSC G. And we say that we, we look at users of space, because really, it’s been a plethora of different types of users that we have been able to work with in the retail sector.
Ressa 24:36
Yeah, for sure. The occupier, well, what is dubbed retail real estate? One of the things I always say is, the closest commercial real estate to the consumer, and everybody’s trying to get closer to where people live. And so there are other occupants looking for retail real estate other than what might be dubbed a traditional retailer, but I think it’s good uses for those retail properties. Great.
You know, there’s obviously some, there’ll always be some noxious uses that might not work in that type of property. But I think the types of users for retail properties is expanding. Great. Yeah. So how long has it been now? How long have you been at the TSCG?
Popovics 25:36
A little over a year now.
Ressa 25:39
What was the biggest aha moment that you had?
Popovics 25:55
I don’t know that I have necessarily one big one. But I don’t have all of the reporting that maybe I would have had on the reads or private side of the business. On the landlord side, I do a lot on smart sheets and things like that. But there’s definitely not as much reporting.
Ressa 26:16
Got it. So less, less data. More systems?
Popovics 26:24
Yeah. I mean, I’m putting in some systems so that I personally can continue the process part, right, you need that, but not as much day to day, like data entry, so that everybody can take a look at it, right. Like we’re sharing stuff all the time. And a lot of it is just in the communication to understand what’s going on, and all the markets, and who knows who and what have you heard. So a lot of it has been, I’m on the phone all the time.
Ressa 26:51
All right. Well, that’s good. I think business happens when people have conversation.
Popovics 26:57
So, right, not ever, not always over email all the time.
Ressa 27:00
Well, listen, Nicole, this has been fantastic. Anything else that we didn’t talk about that we should?
Popovics 27:10
It’s exciting out there. I mean, the amount of retailers expanding is just really cool for our business, and different types of retailers, and all kinds of cuisine that has been expanding. It’s, I think it’s exciting. I can’t remember a time, and maybe you can correct me, of when we’ve had this many types of concepts and this much competition for space. But it’s really cool that people have come up with these concepts. It’s, I love it.
Ressa 27:43
And demand is more robust than it’s ever been. There’s no doubt about it. So, and that’s exciting. For sure. Okay, yeah. Let’s get to the final part of the show. I call this ‘Retail Wisdom’. I got three questions for you. You ready? Got it. All right. Question one. What extinct retailer do you wish would come back from the dead?
Popovics 28:06
Jacobson’s department store? I’m pretty positive. They were ahead of the game on experiential retail. Back in the day.
Ressa 28:14
Okay. Question two. What’s the last item over $20 you bought in a store?
Popovics 28:20
Shoes? You can try them on. I gotta try. Nordstrom’s, Nordstrom sale?
Ressa 28:27
Last question. If you and I were shopping at Target and I lost you, what aisle would I find you in?
Popovics 28:35
The seasonal section. I love to host.
Ressa 28:38
Alright, there we go. What’s the next party you’re having?
Popovics 28:43
Let’s see. Where are we? Are we in August? We’ll probably do a back-to-school bash.
Ressa 28:47
That’s a new, that’s a party. I don’t hear, you’re gonna have a Back-to-School Bash. I want to get invited to that. Yeah.
Popovics 28:53
So this is the first week of school, so it’s coming Friday night. Well, now the pizza and pool party. Right?
Ressa 28:59
Is that like, an exciting that the kids are out of the house? Or is that a, what’s the theme there?
Popovics 29:12
Yes, we’re back to structure.
Ressa 29:15
Okay. All right. Well, the call. This has been great. Thanks for joining us today. Thanks for shedding some light on what’s going on from the tenant side of the retail real estate industry. And good luck. I hope the Australian retailer is a smashing success.
Popovics 29:34
Thank you so much. We’ll report back when we can announce everything awesome.
Ressa 29:40
Thank you for listening to Retail Retold. If you want to share a story about a retail real estate deal that you were a part of on our show, please reach out to us at retailretold@dlcmgmt.com This show highlights the stories behind the deals from all perspectives. So it doesn’t matter if you are a retailer, broker, entrepreneur, architect or an attorney Also don’t forget to subscribe to Retail Retold so you don’t miss out on next Thursday’s episode.