(Real Talk Series #20) Gregg Katz
Guest: Gregg Katz
Topics: The Shopping Center Group, retail real estate
Chris Ressa 0:01
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. Today I am joined by Greg Katz. Greg is the CSO Chief Strategy Officer at the Shopping Center Group. Greg has been in the industry for 15 years, you’ve probably seen him because he’s very active on social media. Excited to chat with him today. Welcome to the show, Greg.
Gregg Katz 0:39
Thank you for having me. I greatly appreciate it. So Greg,
why don’t you tell us a little bit about who you are your journey and what the Shopping Center Group does?
I’ll start with the Shopping Center Group, we are a predominantly a retail Real Estate Organization. And we have what I would refer to as four or five legs to the to the table, so to speak. So our service lines, our tenant representation, which is, which is our core business and what we were founded on. We have third party services landlord services, which consists of property management, and third party leasing, we have an investment sales arm. And we also have a very robust analytics part of the platform as well. So that kind of makes up our core. I’ve been, as you mentioned, I’ve been in the business for about 15 years with the Shopping Center Group. And prior to that, I spent a lot of time in the restaurant industry, both from a operations perspective, a real estate perspective, and actually owned a group of fast casual restaurants down in the Orlando area for about six years that I call my unofficial MBA, as I got a quick education in, in the restaurant business as an owner, so it was
very interesting. Awesome.
How did you move from the restaurant business to the Shopping Center Group.
coincidentally, how it came to pass was when I was looking at the Orlando market, I, I had a territory I was originally a franchise of a concept and actually, after a while realized the franchise wasn’t going to be long term viable for what I was trying to do so broke off and created my own concept, and created a strategy from a real estate perspective and a location perspective that actually at the time was, was assisted by the Florida Shopping Center Group and use a broker there who who I got to know very well and and really enjoyed the real estate aspect of what I was doing as much as I did the operation. So it seemed like a natural progression as I sold the restaurants to kind of go into the real estate side of the business and started at the Shopping Center Group as a as a tenant rep. And coincidentally specializing mostly on the restaurant side
of the business. Got it
and you moved all the way up and today you are the chief strategy officer which is really interesting because you can go into our space and whatever you define our space you have third party companies like you you have landlords like us, you have wood and all everything in between architectural firms, title companies lenders, CSO is not a title you see often Chief Strategy Officer so tell me about that role, how that was kind of developed and what what you what what is the Chief Strategy Officer do
sometimes I honestly don’t know myself however, I will tell you that it kind of evolved out of my previous role. So after brokerage, I moved into Director of Innovation and Technology and and that was at the time I honestly there was no one else. It same type of thing. There really wasn’t anybody else that had that kind of title or role that I could find in the industry. And so I it was it was a unique way of bringing together a lot of the technology and strategic parts of the company under one umbrella. And I think what we realized back then was you know, you had everything from marketing and digital marketing and GIS and mapping and, and data and analytics and even things like phones and IT systems and things like that. And they were all happening in silos. And so what ended up happening is this role brought all of those silos together under one umbrella to create a holistic strategy of what we need to look like in the future, how we need to get there,
etc. As that morphed,
the Chief Strategy Officer role kind of expand hands on that. And so it adds a little bit more of a company based view from the standpoint of people, human capital, right. And, and the strategy around where the organization needs to be, you know, three years from now, five years from now, seven years from now, etc. And what’s happening in the industry? And how do we need to get there? So it’s, it’s taking, it’s taking what we learned from a holistic approach on the technology and innovation side, and trying to leverage it for the entire organization from a strategic standpoint.
you have a team? I imagine you have a team? Do you have a team?
We do, I have a team of about, we’re a company of about 230, I have a team of about 25 that are made up of marketing, research, it marketing, research, it mapping and, and a little bit on the strategic side as well. So we’ve got a pretty robust team that’s behind that to support and, you know, take care of all the initiatives.
Got it? So is you
in now and I understand a little bit more, and I think that’ll be good context for everyone out there who hasn’t heard of the CSL before? Through this time? What has been your biggest focus?
That’s a great question. I think it’s, it’s been twofold. One is what happens when people go remote and work from you know, remote work, work from home, whatever you want to call it, and a the logistical piece of that, and then be the, the emotional and, and the human toll that it can take in terms of, you know, immediate change, and what it does to you know, where your role is going to be what’s happening from a business perspective. So, it’s been communication, and logistics, and making sure morale is there. And it’s been, there’s been ebb and flows, we’ve learned by trying and doing it messing up a few times, here and there and having some great successes in other places. And I think what it really comes down to is, people want to feel connected, and want to feel valued and want to feel like they’re contributing to the organization. And sometimes when you’re sitting at home, whether it’s at your kitchen table, or in your home office, or whatever, it’s hard to really get a read on on that those aspects of your contribution. So we’ve really, we really put a lot of effort into into making sure that we continue that landscape, because as you know, I mean, real estate is a holistically very social, right, very, you know, relationship driven, etc. And so is our company operates that way, and our culture operates that way. And we had to keep that, through
this pandemic didn’t, what is what has been the the biggest
success or strategic move that you guys have made that’s working in the last six months?
I would say there’s two. One is the creation of tools and resources to allow business to continue, as usual. So by that, you know, the things like zoom and that type of thing are the obvious ones, right? Making sure your organization has, but things like virtual tours and ways to show property in unique and different ways where you don’t necessarily have to be at the property initially supporting that with with the analytics and the data and telling the right story and continuing to have business as unusual as it is, but business as usual, right. And I think, as you as we looked at that I that’s been a big piece of it. The other has
ways to collaborate. And it’s interesting, because I always thought collaboration really needed that physical interaction continuously, you know, brainstorming sessions, water cooler, you know, meeting so to speak. And I think what we’re finding is there’s ways to continue to collaborate and stay innovative and come up with creative ideas, even if you’re remote. And I think those two things together have led to have led to a lot of successes. And actually, I would tell you business, it’s probably not where it needs to be by any stretch of the imagination. I don’t think anybody in real estate would say that, but we I think we fared a lot better than we thought we would, back in March when all of this starts
bringing up an interesting point, which is, and I’ve said this for a while, which is that there’s most jobs not all, but most jobs in America in most industries can be done remotely, there’s obviously certain sectors right? If you’re in a retail store, the retail staff, hospitals and stuff. So maybe most is on for fair word, but there’s a significant amount of jobs that can be done remotely. However, there is some unquantifiable power of the human connection
and being together. And I guess, given that you’ve had high productivity virtually, do you still believe that there is a necessity to be in person? Yes,
yes. And I agree with what kind of how you just frame that up? Chris, I think
it’s, I think that although video calls
and those types of mechanisms that are out there now can allow for some connection, I think it’s a different kind of connection. What I’ve noticed with with Zoom call, or Microsoft Teams, or whatever you want to you want to say is that you feel like you’re always on and so you always have to act a certain way. And if you leave your screen for a second people wonder where you are, but like, if you’re together, and you say, Hey, I gotta go run, get a cup of coffee, nobody really questions that that, you know, you just kind of go do your thing. I think there’s a different interactions taking place. And I think it’s still beneficial. But I don’t think it replaces that human component. I think understanding truly understanding facial expressions, understanding tone, being able to, you know, shake somebody’s hand, give them a pat on the back and say, job well done. That does it 100% Translate virtually. And I think that there’s definitely a place for the office, I don’t know that it will be, you know, five days a week or whatever, you know, nine to five, so to speak up. But I do think there’s a huge place for the office. And I think it’s a
I think one of the things that I think about when I think about what is some of the power of
the human connection is that you have, everything now is scheduled. I was pretty, I was pretty scheduled person previously. And so organic training and development, I think in America is probably at a at a low, because you have, you know, our, my, our General Counsel made mentioned on an executive management call. He’s like, if someone had a question, they shoot me an email, and they had a question on something, I go out into the out of my office into the cube area, explain it, everyone would get to hear it, learn from it. And I thought that was interesting perspective, because that is now gone. And I think
we probably need to grow as a society and, you know, in American business, we need that. And so there’s no doubt you can be productive remotely.
But, you know,
are there opportunities that are missed from not being together?
to your point, I think, think about if, if you’re onboarding a new employee, a new broker, whatever the case may be, right? How how do you integrate that person into your culture into who you are? Right? And how do you train them to, you know, in whatever that role is, without having that interaction. And I also think the other piece of that is, you know, you look at as a holistically, you look at Gen Z, and it was already very digitally oriented. And, you know, all the concerns around that, just that core digital orientation for everything. I don’t know how your experiences have been, but when I, you know, I could yell to my kids and say, It’s dinnertime, and I don’t get a response. I can text them and they’re like, Well, my way down. And so I think, you know, I think building that relationship digitally. This is kind of furthered that for that generation is now coming into the workforce. And that does concern me as well, because I think the human interaction component is kind of forced on you, as you enter into the work world if you’re going to, you know, depending on your role, obviously, but if you’re going to be successful, and I think Gen Z needs that, and it’s a critical component that right now they’re not getting.
the we’ve focused on continued training and development because of missed opportunities here at DLC that but the digitally oriented is an interesting perspective. So you know, you spend a lot of time on innovation and technology. Have you seen any innovative breakthroughs for the commercial real estate industry, yet?
Coming out? As the pandemic you know, I think there’s two things with that. One is commercial real
estate holistically has not been great at adopting technology quickly, just generally speaking, right. And and I think people always tend to say, Okay, we’re laggards, this and that I don’t think that’s necessarily the case. I think it’s more that we’re especially on our side, when we look at brokers in general and how people transact. You develop a workflow, you’re comfortable with that workflow, it works for you. Why do you need to change it with any kind of technology, if you’re good, and you’re making, you’re making a good living? Why change anything, if it’s not broke, don’t fix it type of thing. But I think with some of the technology that that’s been coming out, especially around the pandemic, I think it really brought to light or continues to bring to light things like mobile data, and movements and changes in that. And it’s been that’s been around for a while, but I don’t think it was as mainstream as it is becoming because people want to understand, you know, what is what is really happening? And what does it look like, pre COVID to now and you know, how it’s being used to track the pandemic, even right, with COVID cases and movement of those people. And so I think that’s been a that’s been a big one. And I do think the way people are starting to conduct tours and things virtually in the technologies around that are also again, have been there that are becoming more mainstream, and more functional for the end users and more simplistic for the end users. And I think those are, are both of those are gaining quick adoption.
What are you using for virtual tours,
created our own internal platform through ArcGIS through our ESRI platform, which is our mapping platform and have leveraged in, you know, some virtual reality and some 3d etc, etc, and some of the Google Street views and all of that incorporated at all into that platform. So we are bringing in, you know, the drone videos, and like I said, the 3d and the inside space videos, etc. But it’s all done in house and
through through our platform. Got it? And are there cameras everywhere now. I don’t think it’s as
much as there’s cameras everywhere, as there’s the ability to get cameras everywhere, right. So if a space doesn’t have that you can go in and you can now use your iPhone and get a full, you know, a full of space plan based off of you know, scanning it with your phone, and you can use the Mater ports of the world and things like that to, to give you what you need. So I think it’s the tools are more readily available, and more more mainstream so that people can get the basics done, turn it over to the you know, to the mapping team and allow them to kind of finish it off and make it
look great. Awesome.
That’s a good, what I would call it high level business kind of scenario of, you know, the pandemic, what is, what do you see as gonna be, you know, your focus, Greg’s focus between now in the next 12 months, where are you going to be
dialing in your energy? twofold one is getting,
getting the right balance of in office and out of office, work and collaboration, etc. I think that the other piece of the equation is typically when we saw this in the, in the, in the great recession coming out of you know, in 2000 789, et
cetera. We see that because of
the strength that takes place in real estate managers on you know, and and, and researchers and analysts, etc, from a lot of the retail platforms, a lot of retail companies, we see a an increased need for more information, more platforms, more data, more technology, that that retailers, restaurants, etc, asked us to provide versus having them to have the resources. So we look at this as an opportunity to further grow the analytics part of our platform and really, and really stay cutting edge and in front of support, not only our existing clients that we have, but the analytics clients that are external and non brokerage. So it’s I think those are the that’s where the big focus is going to be the demand. We’re already seeing that demand really start to ramp up as people are trying to figure out what to do.
And got it.
So let’s take a pivot. We have been a little bit but a little more. What’s going on in, you know, what’s your, your sense based on what you do and all the information you have at your fingertips? What’s going on in the marketplace? What do you see happening not withstanding what we read in headline news.
I think that the interesting component for me is, I think that there’s several things. One is this continual
to resurrect and, and keep life to the some of the concepts that probably would be beneficial if they move if they moved on. And so the JC Penney’s of the world and the Game Arts of the world, and I think that is this long, slow death, or this long, slow process that just continuing to create ambiguity on the retail real estate side of the equation, I also think that the focus towards you know, we were moving away from certain segments that we were moving into entertainment and restaurants, and, you know, all of these things to take place of other concepts that were kind of phasing out and on their way out, and more more fat oriented. And I think that that’s gonna cause a big we look into what does that mean? You know, what, what does entertainment mean? And how can we still leverage that? And what’s going to be successful coming out of the pandemic, and who’s going to, you know, who’s going to feel comfortable in these environments? I think that’s a big piece of it. But I also think that this, this willingness to stay retails, demise is here and all the great headlines about bankruptcies, and, you know, it’s the sensationalism that goes around that retail will evolve, it continues to evolve, this is just something that may have forced evolution to be quicker. And I think we’re, we’re being headlined out to your point about all the, you know, what, here’s all the negatives that are going on, but there’s a lot of opportunity. And, and it’s, it’s a lot of places where they turn crisis into success, right, and where restaurants have found out that, you know, I can’t maybe do as well as I did before. But by being innovative, and having people being served in the parking lots, or, you know, creating a way to get my, you know, have my food be able to be to go, all of these things have have allowed people to continue to survive and eventually thrive. And I think that’s a big, that’s a big piece coming out of this, that there’s not as much focused on from a general media perspective, because it’s not as that’s not as fun as talking about, you know, 7000 stores are going to close this year, and all of that fun stuff. So I think there’s a just a reinvention and a re evolution. And I think it’s actually an exciting time, if you can figure out the right niches to be in and the right ways to to leverage what’s going
on. Make sense? You know, the some of the brands that you talk about i I’m always fascinated by those that can take nostalgic brands, reinvent them with success, not easy to do.
I hope that some of these brands that happens to and that happens in the non retail space, and in the retail space in Atlanta based one that I had on the podcast recently stuck yeas, yes, it is, you know, really focused on, you know, bringing back this nostalgic brand, I think she’s doing a really good job from a social media perspective and bringing the consumer in, and I think they’re going to reap the rewards of that, I think, you know, this might be it could be that some brands, you know, shouldn’t exist anymore. But it also might be a time where you can Bry nostalgic brands at a discount, and what can you do with them, right? And so if there’s a focus on running them the same way as yesteryear, then maybe they should go but if there’s meaningful innovation and, you know, a thought process on what the outlook might be forward, I’m intrigued to see those who can figure out some interesting mousetraps by buying nostalgic brands and turning them around. I find it a really fascinating topic, in particular in our industry. So we will see how that plays out. And what the evolution as you’ve saved is around that.
What’s keeping you
up at night? I hate the question, but I am curious, you know what is over the next 12 months? What is your biggest concern?
What’s the permanent change? The consumer behavior is and how that impacts our industry in our, in our company. You know what, what is what is more permanent in? You know, we we started this week we’re talking a little bit about remote work and you know what that’s doing just what changing habits because as you know, this has been long enough to create some permanency to some of the habits that consumers have and what does that look like and what stays and and how do we adapt to that? You know, what is, you know, what’s the change in the parking lots look like because of curbside? And does that stay right for, you know what happens to impulse purchases? Because, you know, because of those types of things. I mean, I was in was in a grocery store
earlier this week. And it was
I felt like it I’m being a little extreme here, but I felt like it was me and 50 Instacart pickers, right, and that was it. And and this is just just this dramatic change of stuff that you’re seeing happen. And I’ve just wonder what it means and how do we get in front of it? And I don’t know that anybody has the answer yet. I think you can speculate and you can, you know, look at the data. But I don’t think anybody knows what coming back to normal looks like and that’s that’s my biggest worry.
Right now. That is
an interesting innovation. You know, in retail, we have this thing called C store standing for convenience stores, one of the things that really hit home is I was at a Wawa this summer.
And they had a curbside pickup and what dawned on me was someone who’s dubbed themselves a convenience store convenient. And I don’t know if Walmart considers themselves that the world that’s in the convenience store category, but
already convenient, making themselves more convenient by offering curbside pickup, which was a really, to me interesting, because you hear about the businesses that maybe aren’t as convenient trying to become more convenient. But the convenient becoming more convenient was interesting to me. So
agreed, and and you look at that and say, okay, it makes it more convenient. And then you start saying, but at what cost, right? And what happens to the impulse purchase, if you’re like me when I go to a Wawa or sheets, or any of those, you know, Kwik Trip, etc. And I’m going, you know, I go in to get a bottle of water. And I usually start coming out with a thing of chips or candy bar or something. Right. And so what happens to that, as you get that person coming out to the curb? And so it’s those are great and interesting discussions. And I don’t know that, like you said, I think I don’t know that anybody has the answers yet. And it’s interesting to watch and see experiences, like you just talked about, and understand does something like that stay long term? Or, you know, if once we return to whatever that normal is, is that go away? And and is there a strategic advantage in having it or not
having it? Yep. Last,
so when did on a positive? What are you most excited about?
The the innovation that’s taking place right now, and I say that broad base, but really, it’s watching people figure out how to adapt, thrive, survive all of those different things. And hearing those stories, the opposite of what we were talking about earlier, hearing those stories and be when you hear of a, you know, of a five star restaurant that turns their parking lot into a sonic style drive up, you know, eat your food in the car type of scenario, and it’s pack, right. And when you hear about, you know, when you hear about the modifications in product or, or ways of getting, you know, items to customers, I think we are so resilient in our creativity, and it’s super exciting to hear about, you know, what’s happening, what’s coming up, etc. And those are the ones that, that get me excited. And those are the people that I like to, you know, follow and understand what they’re doing and why they’re doing it. And they’re taking a big risk. You know, but it’s the it’s the out of crises comes tons of entrepreneurial opportunity. And I think that’s the
cool thing right now. Awesome.
We’ll end on that. I agree. That is a cool thing.
Last part of our show, retail wisdom.
I’ve got three questions for you. Are you ready? I am ready. All right. One, what is your best piece of commercial real estate advice, Greg.
seek advice, learn from the best. So I sum it up with be a sponge, take it all in and at some point you’ll be able to wring it all back out.
I love it. All right. Question two. fan favorite. You mentioned
some before what extinct retailer Do you wish would come back from the dead?
I have on the
skaldic one and one that was more personal to me one is mine Ostalgie because Toys R Us I just
my kids grew up because they’re,
I can’t tell you how much money I spent on Legos in there. So, you know, that’s, that’s what I would just love to see figure out how to how to make a comeback. And from my personal perspective, beta, because I thought beta was a really cool and innovative concept that that kind of was taken away from by the pandemic. And it was I thought it was one of the first of its kind of innovative, and I enjoyed it. So that was
probably the other one. So beta is interesting to me, because Are there going to be more digitally native brands that were not, you know, for, you know, Profit First organizations, and they entered this challenging time with negative cash flow and cash burn, are there going to be more of those that end up, you know, going by the wayside, because bad timing and the models just broken? Nonetheless, they were the fan favorites of Wall Street and investors in VC world. So I find it interesting. We’ll see what what happens with some of those.
I found what I what I found interesting, mostly about them was not only you know, they had this unique obviously model of how they basically, you know, basically leased or rented space, right space within space. But there they were also selling their technology right there store technology, how to, to track people see what people are buying, how long they’re looking at something etc. And they crew creating partnerships. They were starting to be on the endcaps of Lowe’s. They were, you know, they had partnerships with Macy’s, etc. So they were starting to, you know, they were more than just that store that you would you would see there. And I just found it interesting that they were covering kind of all aspects of the business.
And not just the retailer. I’ll tell you the retail thing
that I loved about I love about beta is they had products you couldn’t find in other stores. That’s a simple retailing fundamental is Do I have a product and service that unique and not a commodity. And all too often we’re going into stores and I use this example often, which is you can find a lot of Pepsi and pampers everywhere. And it’s hard to compete. If you want to sell Pepsi and Pampers with the Walmart’s and targets and Amazons of the world. It’s hard to compete on Pepsi and Pampers. But if you have something a product or service that is not commoditized. Well, you have an interesting market advantage. And I thought data just from forget about the model, I think the media to me got too caught up in the model. And one of the most fundamental things was, you know, that’s one of the things I do like about the direct to consumer is this is this product that you can’t get elsewhere. And I think there’s something to to that in retailing in the future, which is, you know, what is the true purpose to coming to the store, and that discovery of innovative new products was definitely that for them. And I wish that that hit home a little bit more by headline news. But to me that was an interesting one on them. I
agree completely it the the the
the exploration right of those products, and also the education, that staff knew everything about all of those products. That’s what they had to do. And so you were getting, you’re able to explore and you were also able to be educated at the same time. And it was it was that was interesting. And you You’re right, you could not go down the street to Target or Walmart or wherever and find these products, which I think was a unique advantage.
Yeah. Last question.
I don’t know about you, but I’m a Thanksgiving fan. Thinking about Thanksgiving, it’s October. We’re actually being quite candid. We normally host we’re thinking about what we’re doing for Thanksgiving.
We haven’t confirmed yet. But to that end, I am on Target’s website now. And
I am looking at the butterball frozen bone in turkey breast. What is the price per pound for the butterball frozen bone in Turkey breast on
The I knew I should have brushed up on my Thanksgiving prices. Oh, I’m gonna go with oh, I’m gonna go with
1499 a pound.
Wow, it’s 229 a pound here. So, but thank you for what I know. You’re not buying the turkey for Thanksgiving is my my take on that
clearly. But thank you for playing.
And listen, appreciate the time. Thanks for coming on. This was great a unique perspective that we don’t get on the show too often.
No, I appreciate the the invite and and thanks again. It’s great.
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