Retail Retold Replay: CanesWear in Davie, FL with Beth Azor
Guest: Beth Azor
Topics: CanesWear, mom-and-pop shop
Chris Ressa 0:02
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.
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All right, everyone. Today I have for you Beth Azor. Beth is a legend in the retail real estate industry. We are business associates. Beth owns six shopping centers today. She is an entrepreneur who also has a retail consulting business. She’s been in the retail real estate business for over 34 years. She has done deals with major national tenants as well as opened hundreds of mom-and-pop local tenants in shopping centers across the state of Florida. Welcome to the show, Beth.
Beth Azor 1:29
Thanks, Chris. I’m so excited to be here.
So excited to have you because you have a plethora of knowledge as well as you’ve made more deals than most people. So I’m sure you have a ton of stories that could have been on the show. And that’s just a prelude that will probably have you on again in the future. But you know, the premise of this show is this the story behind the deal and how that story ended up in your neighborhood. And who are we talking about today, Beth?
So today we’re going to talk about a mom-and-pop called CanesWare in South Florida. They are the apparel merchandiser for the University of Miami football team. And you know, just school teams basketball, baseball, so they carry the merchandise for the school. And the school is located about 40 miles away from my shopping center. I’m in Fort Lauderdale, a suburb of Fort Lauderdale, my shopping center, and they are down in the heart of Miami.
Got it. And so how did you end up hearing about this, who they were?
So one day my office was in the shopping center we leased in one of our vacancies, our office space, and I was driving to work one day. And I noticed in the median of the street we were on a very highly trafficked street about 70,000 cars a day. And in the grassy median. There were about 40 lawn signs, you know, tiny, like, you know, one foot by two feet, with little stakes in the ground and it said canes were apparel, and it had an address. And I recognize the address. First of all, the word apparel jumped out at me, Chris because you know, in our new retail world of online sales versus bricks and mortar there not a lot of apparel, mom and pops expanding these days, right?
Yeah, but normally those signs I see. I see say “WE BUY HOUSES”.
That makes me laugh!
I noticed that the address was for an industrial area near my center. So I walked into the office and I have a junior leasing agent who worked with me, McKenzie, and I said, did you see those signs out in the median? She said what signs? I mean, there were 40 of them, you know the millennial generation. So I took her outside and I showed her the signs and I said we need to go find this guy because this guy you know we need to have him in our shopping center if he’s got a bunch of University of Miami apparel that is a destination tenant. Fans are going to find him that’s why he’s in an industrial area because he’s a destination. And Chris you know, getting a destination tenant in your shopping center that has a following is one of the keys to leasing a successful shopping center. You have to have a combination of destination and impulse tenant. So it screamed to me destination.
So then she finds him and his door is locked and it said call for appointment. She comes back and she said, I left a message. I haven’t heard back and I said, Well, did you look in the window? And she said, yeah, it was filled with merchandise filled, like jerseys and T-shirts and hats and tennis shoes. And I’m like, Okay, this is this guy’s great. We got to get this guy. Well, typical, you know, sales folks, I forgot.
And what happened a year later, I’m driving to the office. I come upon my, you know, major thoroughfare that my centers on and there are the darn signs, again, 40 signs, and I’m like, Oh my gosh, because it’s football season again. So he’s prepping, you need some marketing genius, right? So I’m like, I go in the office. I said, McKenzie, the signs are out again, we got to go find this guy. So she goes over there, the space is locked call for appointment. So I said, No, we are not going to let go! So she goes, she goes, she calls, she sends a message on Facebook, you know, we’re really on it. And finally she connects with him. And he says to her, you know, I’m not paying any rent at this industrial location, you know, there’s no way I can afford to go into a traditional, you know, strip shopping center. And she said, Well, please come after football season. We know you’re busy now. But after football season, come and talk to my boss because she’s really, she really wants to do something with you. And she’ll be creative. So he says, Okay, so about so I’m now all over this.
And like in January, after the all the bowl games, I’m like, we got to go find this guy. I want to talk to this guy. And one day, I’m sitting in my office and I have like, I could see to the front door when people walk in. Like there’s these open window areas. And I look and I see a guy walked in and he’s got a shirt on that says canes where you Chris, I almost leapt through those windows, I jumped up and I went running out to the front. I’m like, Oh my gosh, you have to come to the shopping center. And he’s like, he’s like takes a step back. Whoa, right. And he says, I can’t afford you. And I said, Look, I had had a sprint store that it expanded and left in the 1100 square foot space. And it was a mess, right ceiling tiles were you know, half cut off. Grid hanging down, you know, not my typical. I usually like to have really nice clean vacancies. But this expansion had just happened. The space was a mess. I was getting ready to spend some money to clean it up. And I said, Look, I have this space. And I have a sub sandwhich guy that is like does five times the average sub store sale revenues that this little vacancy was right next to the sub guy. I said I have a space next to La Spada subs. He goes, “Oh, I just ate there! You know, they kill it.” I said exactly. I can put you right there, you need to take it as is. I’ll do it for 1000 a month during football season. You know, you can sign the lease now for like this pop up. And between July and January next year. You know, you see how you do? And I said How much do you do in the warehouse space? And he said about 300,000. I said you’ll double that Here he goes, if I double that here, I’m going to stay and pay you a real rent. I said great.
Was this going to be a relocation or was this going to be a his like second location?
I wanted him to just bring his merchandise and open in the store whether he kept to the warehouse or not. But it would have been it would have been his main store for during football season and then he would have kept the warehouse just for you know stored merchandise
And the warehouse was in Miami area?
No, no, no, the warehouse was a mile from my shopping center. Okay, so it was close.
So we ended up shaking on it. He does the deal. He fixes up the space. He spends about $20K more than he wanted to fixing up the space. And he opens for football season. And Chris, he did $600,000 in five months.
So now he’s like, okay, I need to stay here right, but I can’t afford it in an offseason. What are you going to do for me? I said, you can pay $500 a month in the offseason, but then you have to pay $5,000 a month next year during football season. And he agreed to do it! So we did that for about two years. And he went from that $600,000 to the next year, he did $800,000! Then at one point, he was doing over $1 million and he was in this 1,100 square foot space. He was doing so much online business, literally in the aisle ways of the store, you could not walk in this guy’s store.
And I kept trying, I have a 42,000 square foot center. So it’s, it’s an unanchored strip center. Panera Bread is my anchor. But it’s split into two buildings. So it’s 20,020 1,000. And I wanted to move CanesWare expand him to 2,300. But he’d have to move away from the sub guy, which he believed, you know, was our anchor, and go in the next building. And I said, you need more space, you could do more business, we can give you a little area for online sales, shipping. And he, he just did not want to move, you know, mom and pops, once they’re successful. They they’re very fearful of moving because any little thing, right, could kind of disrupt sales.
So I finally got him to agree to move. And he moved to football seasons ago. So in 2017. And he literally, he I think he went from 403 or 400,000, in online to $800,000. And his store sales were, you know, close to like $1.5M and north of that. Now, for him, the success of the football team really plays a large part total. So even though he did well, this football season, because they didn’t do so well as a team. It wasn’t as great as the prior years. But he’s now in a long term lease, I think a five year with a five year option. He’s paying real rent, right? He’s paying market rent like everyone else. And he’s been doing that since after two years. So he’s been paying market rent for about five years. And now he’s doubled in space has a hole he literally has about 800 square feet just for shipping and online.
So does this guy have like a deal with Miami University? Is that how he’s able to do this?
He has contracts with I think Nike and Adidas and probably he they’re very involved. He has a partner that’s very involved in the boosters so I believe that they do have some connection. The school itself has a store, an apparel store, but that’s down in Miami. It’s like in the college bookstore. So this is the only guy that has like…Do you remember, I don’t know if you follow football.. I think you know. Do you remember when they did the whole turnover chain thing? Yeah, he was the first guy that got those shirts, the turnover chain shirts, the T shirts, so I know he has some connection in relation which ship with the school but I don’t know if it’s an exclusive or or whatever. But he he’s the largest supplier of the University of Miami’s merchandise outside of the bookstore on this on the campus.
Wow, I always see guys like this in like college towns, but I don’t it doesn’t feel like any of them are this successful? And maybe it’s just a feeling and they all very well might be.
It doesn’t feel like theyn all are doing the marketing that he does that they’re shipping from the store like he is that he’s that they’re this big of a draw this guy seems like an anomaly to me is he clearly he’s a pretty strong businessman. Have you found you know, you travel the country? Have you seen anyone like this guy anywhere?
So he is a phenomenal marketer. So they do signings in the store. They’ll do like they’ll have football team football players come coaches come. They’re very involved with the Chamber of Commerce. They just had like a tailgate party at the shopping area.
WIth retail there?
Exactly. And he’s open to a lot of ideas. Like I went to him and said, after I went to Shop Talk last year, which is, you know, this phenomenal retail conference where we learn a lot about what’s going on in the retail world. I went to him and said, I know you do a lot during football season. And that’s great. But you already have a lot of business during football season. Why don’t you have like host one night a month during the offseason and have topics people come in and talk about topics for example. It would be great if you had like a doctor and a coach talk about concussions. You know, should my son play tackle football and you know, and then you bring in the moms and you know you like it’s from seven to nine and you have wine and cheese and it’s during the offseason and they love that idea. And they actually are creating a program now for this coming 2020 offseason. And they’re going to have lectures in their store during the offseason. So what’s so great about him also is he listens to advice and doesn’t think he knows it all. That’s, that’s very refreshing for a mom and pop to be open minded. Because I’m not a retailer, I just but when I go in to these conferences, and I learn what other retailers are doing around the country, when I bring it back to my mom and pops, it’s it’s refreshing when one says, Yeah, I think that’s a good idea. Let me try that.
That is a phenomenal idea.
So going back to what you said, the listening piece, I think, all too often, in real estate, the landlord tenant relationship is, you know, has this perception of being this like really tenuous relationship. And it’s as a connotation to be combative. And whenever you can be a partner like that. And people partner, I think both parties end up being more successful. So kudos to you for constantly trying to partner with your tenants, and kudos to him for being receptive.
But going back to the idea, I think that idea is genius, you know, in a world of info-tainment. And that’s what this show is right, info-tainment. Hopefully, it’s a little entertaining, if at all, but I think it’s a little bit and, you know, we’ve had some great guests and the information is, is good. And I think that’s what that is, right? Bringing the the days of just throwing a product on the wall and selling it, they’re not gone. But it’s a lot harder. And when you’re doing things like having guest lectures about topics that you where you can connect with the your potential consumers, and you can connect with the community and have them connect with your brand. That’s how you create long term staying power. And the channel by which you buy at that point, whether it’s online through a catalog or in a brick and mortar store becomes irrelevant, because you’ve built this connection with your consumer. So I think that that’s a great idea. And I’d love for you to tell us how that ends up going.
Yeah, I will.
And he’s, he also is very involved with are very open to discussing ideas to bring tenants like one of the one of the things I love about his name is Brett, the owner. And what I love is whenever I’m in the store, you know, which is probably a couple times a month, someone will walk in and he’ll say, Hey, Chris, how are you? How are you doing? He prides himself in knowing his customers by name. Yeah. And he practices it. And you know, that’s the most important word in you know, in anyone’s communication, right vocabulary, their name. So he’s, he’s constantly people. Hey, hey, Julie. Hey, Kathy. Hey, John. That’s all I hear. And I mean, he’s got 1000s of customers and clients. And I said to him one day, how in the world do you do that? He goes, I practice it. He goes, because I think I’ve found early on that it was very important. And people really like it when you recognize them. And he says, I practice it. So I just thought that was genius.
Yeah, that real local field, that old school mentality about really, I think the retailers that have that concept, come back around again, are going to be really successful. The there’s a retailer in the northeast, called PC Richard and, and they do their electronics retailer, and they do a lot of a lot of the same where someone will go, they have 60 stores and someone will go in the store and the person will come home and tell their friend, you know, or their friend will say, you know, I needed a washer and dryer and they’ll say go see Joe at PC Richards, Joe can help you figure that out. And having that and having that local connection, connection and connecting with the consumer is pivotal. And it kind of felt like it kind of got lost in the 90s and early 2000s. And I think it’s starting to make a comeback as everybody whether you’re online or brick and mortar retailers trying to really create an emotional connection with their consumers. And I think that’s great. Oh, for sure,
And, you know, we’re both on the other side, right. We’re landlords and, and you deal with a lot of leasing agents and I deal with a lot of leasing agents. And, you know, in my sales trainings, I what I hear people say all the time is I’m not good at remembering names. And I always say, well, you should get out of the sales business then. Like that’s such a cop out. And you know, we can improve, right? We can take an online class to improve, you know, remembering names, but it’s just not if you’re in business and you’re in sales. You need to be remembering names now. Can we remember 1,000? No, but we can just get better at it every day, right?
I don’t know whose good or bad at remembering names. I think it comes back to what Brett said your CanesWare tenant, which is right, I practice, it was a priority for him, right? If it’s a priority for you to remember somebody’s name, you will remember their name, I don’t care if you consider that a skill of yours or not, it’s just about effort.
And if you decide that it’s important to you, then you will be a person who’s really good at remembering names. And clearly he decided it was important to him. And so he practiced and he made an effort to do it. It’s that simple. If you saying you’re not good at sports, it’s not a priority for you. So true for both parties, both you and Brett as you this whole deal that went from a sales call that was failed to a year later with a sales call was successful to a pop up store to a permanent store to an expanded store. And it just kept growing and growing. What are some of the what are the one two or three biggest lessons from this transaction? Because so much, or multiple transactions so much happened in this? And I think it’s fascinating. What do you pull out for yourself and, you know, look back on for
What I forgot to mention is he’s he opened an outlet store and another shopping center of mine as well last year. So he has two locations with me now. That’s amazing. And I had to drag him screaming and shouting to that one too. But he’s, they’re not doing as well.
But he’s happy that he has that other store. He did it with a partner with like antiques and collectibles. So I think going back to your question, lessons learned, you know, follow up in sales, no matter what sales you’re in, is so key.
And if you’re not organized, and you don’t have a system, whether it’s a CRM, customer Resource Management System, or customer relationship management system, some way to follow up with the customer. And we dropped the ball on that we weren’t organized, we spoke to him, we went and saw him, but we didn’t have it in a system where we could tickler ourselves to follow up and call back after football season. So you know, I think that that’s number one, and I think follow up just in sales.
How many times Chris, you know, either early on in your career, or what you’ve heard from your leasing team where they had a good idea, they called on a guy, but they didn’t follow up. And then six months later, they’re driving down the street, and they see a coming soon sign for that retailer in another shopping center. And you’re like, ah, like, why didn’t I follow up, right? painful, painful. So follow up!
The other thing is, I think being creative. You know, 10 years ago, very, very, very few landlords, were thinking that a pop up was an opportunity. Very few unless you were in a in a mall, and you were doing kiosk, leasing. This is a thing. And when I travel the country, and I talk to Mom and Pop retailers for my clients, if I walk in, and they’ve got a bunch of merchandise, you know, it might be an educational, you know, toy and bookstore. It could be furniture, if they have merchandise, and they’re bursting at the seams, and they’re not looking for a second location. You know, I will say what do you think about a pop up? You have merchandise? Have you ever thought about another location? So I think and sometimes it can be going like, like with him it was football season? You know, it could be a uniform store during back to school. Right? Where, you know, the parents are driving 20 miles to go to this uniform school uniform store? Well, why don’t you just open a pop up for a couple of months in my shopping center, closer to where your clientele is. And then maybe that turns into a permanent lease for you.
So I think that landlords, and I do believe this is coming around more with the larger companies. But if you have landlords that are listening to your podcast, which I think you do, that are more like me, you know, I’m a small landlord, I only own six shopping centers. Have those landlords considered being flexible and creative? If you have a good tenant, and even if they look cheap, I had a Michaels move out three, six months ago, and we tried to put a furniture store in a neighboring community. They came and said we want to do a furniture store during Black Friday, the weekend before Black Friday, Black Friday weekend and the weekend after. And if we do well, maybe we’ll talk to you about staying. They ended up not doing well. So they moved out. So I didn’t get a permanent lease but I got traffic for three weekends that I wouldn’t have normally gotten so and they paid me rent. I think that landlords should be more creative. And I think mom and pops I know you have your audiences filled with, you know, successful entrepreneurs looking for locations. I would encourage those mom and pops and those those independent entrepreneurs to ask landlords, hey, I have a bunch of product. You know, maybe it’s a bike store and maybe they had been in their one location for 20 years. But they’ve got a bunch of extra merchandise, could they open and try out another sub market with some of their extra merchandise? So I would encourage the the entrepreneurs that are listening to not be afraid to ask the question, because you never know, you might be surprised. Right. I think it’s
it’s probably a hard one to put a number on. But, but I’ll ask you anyway, what do you think the percentages of pop up stores in America that are converting the permanent tenants?
10%? I mean, look, I think that, you know, we keep reading about online retailers, right, that started with pop ups, and now are becoming permanent. So I think that number is going to significantly increase.
Yeah, I think so too. I think I think one of the reasons is there’s a lot of pop up tenants today that the intent is to be a pop up, they derive any intent to actually turn it into a permanent store.
I even I think I read recently like Target did a pop up recently in some urban environment. I’m it’s lost on me where they did this and what they did, but I was fascinated by that. So this is the most successful pop up story I’ve heard. And the mall guys for years have had temp tenants where and when I say more guys, the mall developers the world. They’ve had temp tenants and one of the things they constantly try to do is, you know, temp to perm, they it’s called and convert temp tenants to permit and they are successful. You know, almost every, every model I saw at the time had said over the course of its history had some percentage of temp to perm tenants, meaning they were originally 10 tenants and converted to permanent I think the concept we’re calling it’s so new, I actually think it’s a concept that’s been around it’s just and it’s been around in the enclosed mall world for a while now it’s being embraced a lot more elsewhere, in particular, urban high street retail, I think your story is inspiring because that even in the mall, or that’s one of the most successful temp to perm stories I’ve ever heard of.
And I think one of the lessons for me in that is the successes, you know, the marriage between is it the right tenant and the right property, the guy was doing such a significant volume, it was a no brainer that being in a more prominent location would increase sales and traffic and easy to drive that bus. You know, there’s a lot of groups who are taking shots on, they like an idea. And they open a store and they’re not a good merchant or a good retailer. And they just had a good idea. And the guy had $20,000 in sales, but someone thought it was a good idea. And they try a pop up shop, and it doesn’t work or the concept doesn’t resonate with the consumer and that community. This guy was already doing $300,000 He was a successful business owner. He was just you know, hesitant because the R word scared him, which was rent. And the lesson was you got him over his fear of the R word and ended up proving to him that he was going to be more successful and
Do well and and real quick.
I know we’re running out of time, but I have another very successful, very quick story. My son took piano teacher piano lessons from a teacher out of her home. Her name was Miss Vanessa. And I had a bunch of vacancies it was in the downturn. And I called her up one day and I said Miss Vanessa, today’s your lucky day. You’ve always wanted to try opening your own studio. I have a former chiropractor space. It’s got three separate rooms. We can you can go in and soundproof them. And you can try at 800 square feet. You don’t have to pay any rent, you just pay your give me your insurance and pay your utility bill. And in six months, et’s see how you’re doing.
She ended up staying with me for eight years and expanding from 800 square feet to 2300 square feet. The only reason she’s not there today is because I ended up filling my shopping center around her and she got from zero rent up to about $24 a square foot plus km and my rents at the time were 40 plus km. So I helped her find a flex space. And she ended up going nearby and a flex warehouse area taking 4000 square feet for a brand new studio at the same rent that she was paying in my shopping center the exact same shopping center that CanesWare went into.
That’s phenomenal. That’s unbelievable. Because you had a vision, some of these small business owners make a lot more money.
right and she had in her out of her home. She was capped out Right, she could only do I think 10 students a day, she ended up in the first 30 days of opening her studio in my center hired six teachers, and was able to when she moved out of our shopping center, I think she was up to 300 students the message I want your audience to hear. And you know, both the entrepreneurs, and the landlords, the leasing agents, is now now I’m not gonna, we’re not gonna go and say to a restaurant come to a pop up, right, the pop ups have to be low overhead, low infrastructure businesses, it has to be something that is a service like a music studio, where all you have to do is bring in the teachers and the music and do some soundproofing. Or with canes that were bringing in the merchandise, you’re not going to do a pop up with a medical user that needs infrastructure, a dentist a, you know, a restaurant, but if you are an entrepreneur that has a location, or has a service, and your customers are saying, I wish you would open over here, you need to start listening to your customers, and then make a call to a local landlord. And you might get a guy like Chris or me, who would say yeah, let’s go let’s try it. If there’s a vacancy in the center, you know, I’m guessing the landlords would might take you know, a chance and it could be a win win for both parties.
Awesome. Totally agree at a minimum, your canes where a tenant is going to have one new customer because my next time in Florida, I gotta check this store out, I think you’d actually think this, you know, a lot of people in on the commercial real estate developer side tore different properties when they go to different markets, hearing the story, it just dawned on me, I think this, this store should be on people’s list when they go to new markets to visit and check it out. So it’s now on mine. And I’m gonna go check it out,
you know, when I was hired to go to Boise, Idaho to do some canvassing for a mixed use center that had a bunch of vacancies. And the first thing I did was say, is there a Boise? Is there a football team for Boise, Boise State? And they said, Yes, we found out there were three of them. We went visit three different ones owned by three different companies. One was owned by the school, one was owned by a big conglomerate, and one was a local guy. And we went and made a deal with the local guy for that summer for a pop up. So amazing. So all you leasing agents out there, go find your local college apparel store and see if you can do a pop up in your center. Awesome
advice. I love that advice. All right, Beth. So our last segment of the show we call retail wisdom. It’s three questions. And it’s the same questions for everybody. It’s our version of rapid fire. So but you don’t have to do it in a rapid fire start three questions at the end of the show. So question, one best piece of commercial real estate advice for everyone out there.
So my best piece of commercial real estate advice is knowing your market. And I think that works for the leasing agents, the prop, the shopping center owners and the entrepreneurs. Because if you’re educated about your market, if the entrepreneur that’s listening, knows how many vacancies are in the market that they want to try to, you know, find a space in. They’ll be educated if they know that there’s not a lot. They’ll know why the landlord’s being tough. And the same thing, the leasing agents, if there’s 40 empty spaces, they can’t be as tough as they would like to. So I think understanding the shopping centers and the vacancies and the occupancy around your property or where you would like to lease in is crucial.
Totally agree that’s great advice. Extinct retailer you would like to bring back from the dead.
So I’m going to go a little local with this and I’m going to say a restaurant not a retailer. But there was a Jewish deli down here in Miami called the rascal house. And they were an institution and they had the best corned beef, the best blueberry cheesecake and the best salted right rules ever. You had to wait an hour in line literally people waited outside in line to get to go into the restaurant. And then when you got in the restaurant, the waitress is rude to you. Why we put up with that, but it was it was probably there 50 years and it closed about 10 years ago. I really miss it. My mom, may she rest in peace loved it. So for nostalgia reasons, I wish that would come back.
Amazing. Those are the best stories, the nostalgic ones.
So third question, guess that retail price. I’m going to give you a product and I want you to tell me what you think it retails for. So, I did some homework yesterday on the top selling adult Christmas gifts. And one that made the list was the kombucha making kit. On the Brooklyn Brew shops website. Everything you need to brew your own homemade green tea kombucha in one kit making kombucha couldn’t be easier. It’s a half gallon class fermenting jar kombucha scoop Scooby kombucha starter liquid cane sugar green tea cloth cover and a band. What is that retail for on Brooklyn brew shop.
Oh my gosh. I don’t even know what kombucha is!
It’s a healthy tea.
Yeah. Okay, so I’m gonna guess it’s $79.99
The the resale price is $45. And it’s one of the hottest Christmas gifts of the season. The kombucha making kit. So Wow.
Awesome. Well, thank you. Thanks for having me, Chris. I really enjoyed it.
Talk soon, Beth!
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