Sauced BBQ & Spirits in Livermore, CA
Guest: Jessica Mauser
Topics: Lee and Associates, restaurant industry
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 Jessica Mouser. Jessica is the managing director for Lee and Associates East Bay office. She’s been in commercial real estate since 2005. I’m excited for her to be here. She’s got a great story to tell. Welcome to the show, Jessica.
Jessica Mauser 0:42
Thanks for having me. It’s been a long time in the works.
Ressa 0:44
So I’m glad we finally got got to catch each other in the new year. Look at ASCO, we’re only what 19 days in only 90 days in only 90 days.
So want to jump in? Why don’t you tell everybody a little bit more about who you are and what you do?
Mauser 1:02
Yeah, so I’m the managing broker of Lean associates East Bay, which is located just outside of San Francisco. So I’ve got an office there of about 14 agents, plus some staff. So we’re about 20, all in with an annual revenue of about 150 million. by trade. I am a retail broker, I have been in the retail game since 2009. I do both landlord work and tenant representation. And as of this past summer, I also sit on the board of directors for Lee and Associates nationally. And one of the the first woman to do so since the company has started back in the 70s. So exciting stuff going on.
Ressa 1:39
That’s really cool. So I’m curious, you run this office, you’re a broker? How much of your time is running the business versus doing deals?
Mauser 1:55
Yeah, so great question, I get asked that a lot. at this current time, it’s about a 7030 split. So I’m able to spend the vast majority of my time still working on deals, I’ve been able to put in place a team that handles more of the day to day operations to be my frontline. And then everything kind of cycles for me. So I have a separate CFO and bookkeeper and an ops leader. And then each day we all kind of sync up, understand what’s going on, and then move on with our day. So some weeks, it might be off, but kind of on the on the general run, it’s about a 7030 split of time.
Ressa 2:29
Got it, and how much of your time is spent on strategy of like developing the plan for the office and what you guys are going to do? Yeah,
Mauser 2:41
that’s an ongoing, always ongoing, because as you’re watching agents mature in their career, especially those who are just starting out, or maybe they’re in year two, or three, and you’re really understanding where they’re gonna go, the question becomes, how do you grow that next set, right, because it’s always you always have to have growth in mind. And so we talk on a quarterly basis, shareholders of our office, because we are independently owned by our shareholders, there’s eight shareholders in our office. And so we in a democratic society, make all the decisions as a group for our trajectory of growth, how we operate, how we want to operate, what we see is our visions. So we sit down every quarter and kind of discuss and then each year, we’ll roll out an action plan, how many people do we want to recruit were in who’s going to mentor these people, how we’re going to help those who are mid level get to the higher level. And so but it is ongoing for me because it’s it’s one of those things that I’m always thinking in the back of my head as our real estate dynamics are changing more and more. Here, we’re seeing a lot of ownership go institutional or has gone institutional in the last 10 years. And as more institutional players come in, they’re bringing their in house teams, which is naturally taking away inventory that st brokers would have otherwise had. So as we grow, we have to be more strategic than ever, and how we’re bringing about new associates and how we’re growing as a group.
Ressa 4:08
Totally makes a lot of sense. I I understand. If you were going to tell anybody today, like what is the focus for your office today? What’s the strategy? 2022? What are you trying to do?
Mauser 4:22
Yeah, so I would say our focus right now is being the best at what we are without trying to over produce ourselves. So we know we’re really good in our local market. And we want to continue to be the leaders and our local market, but we are we are I other product disciplines that we can add to our bag of tricks. So we know we do industrial really, really well. We do office really well. And we do retail really well. We just added a team member who’s going to lead up our multifamily side of the business and with her we’ll be able to bring someone on that she’ll be able to mentor And so we’re looking at how to grow our business and a more diverse box that than what traditionally brokerage has been, which is your landlord rent or your tenant rep and you stick to this geographic area. So we are we’re figuring out how to be more diverse with our own set of tools, and how we can cover more ground without stepping on people’s toes within our office already. Excellent.
Ressa 5:23
Well, good luck.
Mauser 5:26
We need it. You know, personalities in a small in a small space. So it’s always it’s always interesting.
Ressa 5:36
Okay, I want to bring us to the next part of the show, which is about you call it clear the air. I’ve got three questions for you. Are you ready? Ready? All right. Question one. When it’s the last time you tried something for the first time, and what was that? Okay, so
Mauser 5:56
just this last weekend, I flew down to go see some friends that relocated to Arizona, we decided to go on this great bike ride. And I’ve got the bikes out all the kids ago and we’re ready to like we’re doing it, we’re all out. We get 10 houses down, and one of the kids is just never going to make this three mile bike ride. So let’s take a decision of hey, I saw that new scooter electric scooter parked on the side of the house. I’m gonna go grab that thing. So I cruise back down the house, grab this electric scooter, I have no idea what I’m doing. I have electric bikes. I’m like, how different can it be? It’ll be fine. So I roll up on this electric scooter, I throw you know, a five year old on the back of it with being like we’re going to town kid you know, so we we went on this bike ride three miles. It was pretty fun now, you know, just just go for it. That’s kind of my personality, though. You just go
Ressa 6:45
three miles. How long did that take on this electric scooter?
Mauser 6:47
So if I would have been like really going on the electric scooter, probably it would have taken me 10 minutes. But we had five children and three adults and a dog with us as well. So we had it took us about 15 minutes, I want to say, you know kind of
Ressa 7:05
all in one scooter. No. Well.
Mauser 7:08
So we started off with just me and one child on the scooter. But then on the way home, the 70 pound dog was not going to make it. So then the dog was also on the electric scooter, which was a whole trial and tribulation in and of itself. So at one point, we had a dog and a kid on the scooter. Actually I should send you a funny picture. Later on. Once they realized how many people we could put on this scooter, we connected the kids. You know one of those like wheelies you put behind your bike, you could put the kids next to each other. So we connected that to the electric scooters with two kids in there. And then three kids on the scooter with an adult so we ended up figuring out how to get four kids and one adult on the electric scooter. And I think we could have gotten one more. I think we could have pushed the limits a little bit.
Ressa 7:53
Yeah, reasonable. Other the other kids were riding their bikes
Mauser 7:58
they were and so my daughter was on her best friend’s borrowed bike, which was a small little kid’s bike. So it was like watching kind of the clown show go along because her knees are like hitting the handlebars on this bikes too small and like you’re fine. Yeah, it was pretty fun. We’re definitely getting a lot of looks on the trail to downtown Gilbert. People were people were giving us the side eye of what is happening over there.
Ressa 8:24
Okay, that’s great. Thank you for sharing. Question two. What is one skill you don’t possess but wish you did? Probably
Mauser 8:36
organization. I am terrible. Like I am terrible at organization. I keep everything in my head, which makes me a terrible organized person. Because the only one who knows the organization plan is me. And it doesn’t make any sense to anybody else. So I, if I could have a good skill, it would be being that person who’s just super organized and is able to like, Ah, here’s the here’s how this works. And this works and how we do
Ressa 9:01
this. And yeah, I got something for you. You do, please. I want you to on Audible. Download the book to do to done by Maura Thomas, 90 minutes. Okay. When you frame how you think of organization. All right, I like it. Thank you. Thank you.
Mauser 9:24
See what comes out of these questions.
Ressa 9:26
There you go. Question three. What is one thing most people agree with, but you do not?
Mauser 9:37
That’s a good question. I would say. I would say sticking with your plan. Sometimes you need to abandon your plan because you’re planning at work. And so knowing when to say enough is enough and being realistic about if a plan isn’t working. It’s time to change tactics. And I think people get too stuck because they get so stuck in their plan, and I’ve put in all this effort, and I’ve put in all this time, I can’t abandon it now, you got to know when enough is enough for
Ressa 10:08
a plan. I love that answer. That’s a great answer. I couldn’t agree more. Okay. Those are great. They will get a little more flavor after you told us who you are and what you do. And those three questions a little bit more about Jessica. I want to take us to story your story about a restaurant or yeah, what’s the name of the restaurant?
Mauser 10:33
So this group is sauce, barbecue and spirits, they now have a secondary concept that they operate as well called, blocked and plucked as their kind of neighborhood chicken sandwich concept.
Ressa 10:45
That’s a good, good name. Okay. So take us back. Tell us how this all evolved and give us a story.
Mauser 10:54
Yeah, so this is, this is a fun story. This is a client I’ve now you know, fast forward 10 years, I’ve done 10 deals or so with this group. But when we met, it was complete infantile stages. I had actually been writing a blog for about two years at this juncture. So this is back about 2011. And a guy in my office says, hey, I want you to meet these guys. They are the nephews of my client. They want to open a restaurant, but I doubt they’re going anywhere. So I’m going to give you this this deal. I’m going to go work with the uncle because the uncle actually owns businesses. And you know, he’s, he’s gonna do some stuff. And so you know, I get thrown this bone, so to say, and I’m only two years over at Lee, I’ve got this blog going, I’m doing the retail thing. I’m trying, you know, I’m grasping, I’m kind of going for anything I can at this point. And so I go meet these guys. And they’re like, Oh, you’re you’re the storefront I thought that was a dude. I didn’t realize it was a girl, right? So we start off on this like funny note of like, well, yeah, I’m the person behind the blog, right? And so we go to her spaces, they’re thinking, Oh, we want to be in this little town Pleasanton. Or we want to be in San Ramon. And so they had these ideas of where they wanted to be. And as we were touring space in there, tell me more about this concept. And in the back of my mind, I’m still holding it up, like, okay, these guys may or may not ever evolve into anything, you know, who are these guys? They’re not much older than me. They have no restaurant experience whatsoever. Ron is the cousin who lives down in Georgia. And he’s like, I’m a barbecue. And I’m thinking I’m like, okay, cool. Like, you know, what kind of barbecue? It’s like, I’ve been at a couple of barbecue competitions. I got this green egg for Christmas. And I’m like, Okay, wait. Now, we’re barbecues. All right, let’s, this is gonna be fun. Okay, well, we’ll just keep going with this. And the other cousin was on the operation side, and was just tired of being in an office job. So I’m like, I guess you guys got to work for this. You don’t have to live in the same state. You guys like what was gonna work right now? Nobody’s been in restaurant business. I’m just thinking to myself, like, Okay, what have I got myself into, I got nothing better to work on. It’s 2011, whatever. Let’s do this. So we tour spaces. And again, you know, we quickly realized second generation spaces how we’re going to have to build this out, they have access to capital, but you know, markets really tight there wasn’t SBA really happening, you couldn’t get a loan. So it was all family money, that they were starting to pool together and figure out, and we’re sitting at drinks when I offered the tour, and once again, and you know, they keep telling me all these spaces are dog poop, you know, and there’s no way we’re gonna have to put so much money into that space. And that space isn’t gonna work in that space. And I’m sitting there and I’m like, well, there’s, there’s a space that I know the tenant isn’t doing well, because they’ve turned it into a underage club now, which is like the telltale sign of all dying. Operations. Like if you are now an underage club, but things probably aren’t going well for you. Right? So I call the landlord. Okay, how much time is left on that lease? Like, maybe like three or four months? Well, I got this other deal for you. So maybe we start working on this. And so it’s literally the day the lease ends, we haven’t really worked out a deal, but I get everybody in the same room. And so I’ve got these two grossly under qualified operators. They’ve got some some money behind them, you know, the family can do it. So the whole family basically shows up to this meeting, because they all know like, this is going to be a team effort. And this is a pretty big local landlord. He owns a lot of real estate. Super nice guy. And at that point, somehow we managed to just get this deal together. The tenant moves out, you know, it gets a 30 day notice we get the space the next month, but the tenant still has no idea what they’re doing. So they’re like shipping in barn pieces from Georgia. Three months, right? They’re free rent is over. Like there’s the chiller blew up on the roof. The ti the whole TI was just like it was a disaster. But nonetheless, this particular space, they get up and going the first year it was a mess operational As you would expect from two people who’ve never been truly in the restaurant business, this is a 6000 square foot restaurant space. Right? So we’re not talking about you just started a little hole in the wall, we’re talking about large format. Yeah, and so large format 2012. They’re kind of all over the place. But by year two, they get this figured out. And it’s running on all cylinders. And they’re pumping about 800 bucks a foot out of this place after about two years. And they realized we can do more of these. And so sauce evolved from there. And within three years, we had three more locations. The fourth location after that was actually right, as Sacramento was redeveloping their downtown, and they needed some anchor restaurants. And so we ended up taking 8000 square feet actually 9000 square feet second generation restaurant in the middle of doco, which is Sacramento’s downtown arena project. And so that store evolved as the fourth store. And so through these crazy kids, one from you know, Georgia, one from California, no restaurant experience where barbecue is the most unlikely event occurred ever, which was these guys took off and it went fast. And we’ve now grown than 10, at least 10 locations between the sauce barbecued spirits plucked, and then they have one more concept that they just started as well. So it was it was a definite stick with it. Nobody thought this deal was coming to fruition it was thrown to me is like here’s a bone take this deal. It’ll never happen. Here we are.
Ressa 16:33
Wow, that’s a great story. So many takeaways from that.
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Ressa 17:48
We’re in this world where time is so precious. And I think what you were talking about early in the beginning you were thrown a bone but like, the reason you were throwing a bone is because the senior broker thought this was a time waster. Yep, exactly. Right. And we’re all in no matter what industry you’re in, we’re all so cautious that we don’t get stuck in time wasters that don’t have any yield for us. And I think the the message is, sometimes you have to balance opportunities with time. And I think, you know, after you went and what I’d be curious about, you went on a couple of tours with these guys. And they were telling you no, no, no. Was there a time when you thought like, think as crazy as this sounds? These guys are going to get it?
Mauser 18:48
Yes. And that’s why I kept touring them to be honest, because you could see the drive. And you could see the wheels spinning, you could see that they were they were getting it and they were getting up really quick for not having been in commercial real estate, or seeing commercial real estate previously, or being in restaurant previously. They you could see them start to understand the business very quickly, in terms of okay, this space isn’t going to work because we’re going to have to put too much ti in the upfront. And they also had a family member who is good with general contractor. So he knew that the dad was in that industry. So he was they had all these pieces behind them. The family really supported it too. And as we did more tours, I actually got more comfortable with them because I could see maybe they didn’t have it yet. But they certainly have the support and the pieces to kind of put it together. And they started to do that in a very quick fashion, which is what continued my drive to go find more spaces for
Ressa 19:50
them. I think you hit on something, though. Earlier there that I think is the key when you’re evaluating of opportunity versus time. To see if something’s a real opportunity, which we’re all looking for, you have to invest a little bit of time. And he talked about it in the beginning, which is sometimes you have to scratch your plan was your third thing, right? I think is like, there has to be a moment where you have to make a judgment call. are these guys going to get there? Or are they’re not because if you had felt after a couple of tours, like this is never going to work, then the right move is probably cut it and go work on something else. But when you felt they, they, they were getting it, as you said, and it was worthy of your time. And I think that’s sometimes how opportunities present themselves. And even in a time precious world, we have to be willing to invest a little bit upfront, in order to get to that point to see, especially in that circumstance. No different than the broker that the senior broker where you were at. Sometimes there’s a lot of people that don’t want to work on something. And that’s where the opportunity lies, we buy some value add deals often where people like pass on it and think, you know, I don’t know if
Mauser 21:13
it’s on loop net, or whatever. But people may not have looked at it through your lens yet,
Ressa 21:18
right. And those are sometimes one of the most exciting projects for me, not the coolest, sexiest one that everyone’s reading about.
Mauser 21:27
Like, oh, pick me,
Ressa 21:30
pick me, right that we turn into something that no one ever dreamed we could turn it into. Those are sometimes my favorite projects, and most rewarding, and both self fulfilling, but also from a financial perspective at times as well. And just like you this opportunity turned into 10 plus deals. I think the other lesson is from just a general business, we have this mentality and in the world today of now now now now get it, get it, get it get it now now now. And these guys took a year before they like got it together. Yeah, might have you sometimes you got to stick with to the opposite of like abandoned it. Yeah, might not be perfect in the beginning. And it takes some time to to make you know, there’s an overnight success takes 20 years sometimes. And in this case, maybe it took a little more than a year.
Mauser 22:27
And they did it. And I think that’s the careful thing about you know, knowing your plan and knowing when it’s time to abandon, you may not be abandoned the whole plan, but there might be a facet to it. That is where you need to abandon that part to it. Maybe you’ve overstretched to your plan your plans too wide, and you need to narrow it in. So being able to take a step back and be able to look at that plan and figure out okay, do I need to abandon this whole thing or just this piece of it? And then figuring out okay, well, if I don’t need to abandon that piece of it, do, I just need to get the right person who knows how to fix that piece of the pie. Because as individuals, we aren’t going to be the all encompassing knower of all things. And this is something that I really challenged myself to do is put the right people in the right places. And as this company grew, and they realized they were a staff of 100, and not 50, they realized, wait a minute, we’re not front of the house operators, we have no experience, getting all the servers are making all these schedules and doing all this. And they’re training people because they didn’t have any training. So they started to bring in the right pieces to fix those parts of the business. And I think that that’s so applicable, whether you’re running a 6000 square foot restaurant, or you are a broker, figuring out your business plan, you have to figure out where you need help in certain areas to execute your plan. And if you can’t execute the plan, well, then you probably might need to scratch that part of the plan until you can really focus and hone that skill set in
Ressa 23:49
a way that makes a lot of sense. The the location that they chose their first location. Yeah. What town was this in?
Mauser 23:59
Livermore right downtown. So Livermore is a small town about 80,000 people 45 miles east to San Francisco suburban neighborhood. But they happen to with the revitalization funds that came to the state of California. Back in the early 2000s. They were able to do this huge streetscape, brand new redevelopment to really make that there was a highway that ran through the center of this town. They rerouted the highway and did this huge redevelopment project. Well, what ended up happening is the delivery of this project was 2008 Perfect time to bring to market about 30,000 square feet of ground floor retail and an untested market. I mean, at that point, it was you only had two blocks of retail and it was old school retail is cow town. So it was totally untested. And so you had an onslaught of you know, this first tenants who signed leases prior to 2008. You know, we’re waiting on delivery that had already signed up. So they went in but then you had that second dairy market that never came. And so it was this up and coming town you didn’t know who was quite going to make it yet. It seemed like it had all the pieces to be cool. But it wasn’t quite flowing yet. Like you just didn’t have it.
Ressa 25:14
When, when the gentleman came to you and you met with them, where did they tell you that they wanted to be at Livermore? That’s where I was getting to. Yeah, not Livermore.
Mauser 25:27
And it was funny as we toured more and more. And they honed in their business plan more, because, you know, it was like, we’re gonna open a barbecue restaurant. Well, what does that even mean? And there’s so many places you were talking a hole in the wall? Are we talking like a Dickey’s Barbecue? Or are we talking like, we’re gonna have something fun and big and crazy. And so they, you know, they throw out all these ideas of like, oh, we’ll have the mechanical but they went all over the places were touring. But as they saw spaces, you could see them start to really define the business plan a little by little, and the true business plan wasn’t defined until they were truly open. And they were getting a couple whacks right, people were complaining about service or is too expensive for the set. That’s when the business plan really was defined. But they had a general sense of where this business plan was going. And the opportunity in Livermore presented itself because it was right downtown. It was second generation. And, you know, out of all things, it was actually a fire and ice. So it had to hood penetrations already in this building, because it was you had an office above it. And so that actually made for a really interesting dynamic that they looked into, because they were able to have their smoker out front, where you can see it and their kitchen, back of the house. And so that was a stumble into, and it ended up being the format for all future restaurants. Oh, it was it was just right place, right time. Good connection, off market deal. Just all those kinds of pieces magically came together. But it wasn’t the deal. We thought we were ever going to have as the first one.
Ressa 27:05
Yeah, it was it was off market because there was a tenant in place. So I wasn’t being looked at it. But but you had done the homework and knew this tenant wasn’t doing great. And you grew up in Livermore, as you said.
Mauser 27:17
Yeah. Yeah, exactly. Yeah. So this was a hometown deal for me. No, this is my backyard. And PS, if you’re going to do barbecue, why don’t you why wouldn’t you be in cow town? You guys, this is your demographic. And you know, it proved itself it did prove itself to be the right maneuver for that first
Ressa 27:33
store. Excellent. Yeah.
Mauser 27:37
And it brought them visibility, right. And so once they had that calling card, going out in finding space was immensely easier, as did their financing got easier because they had this now they have this perfect store of this is what we’re capable of. And if we wouldn’t have nailed that first store, I don’t know that the story would do the same thing.
Ressa 27:55
Oh, I, I interviewed by below Zachman Tierra, who’s the head of real estate at Five Below, on this show. And he talked about this a lot, which is he told the story. And I forget now if it was like, I think it was one of the earlier stores. He was there since like store 16 or 18. And he was saying at that point in time, right now spy below, you know, 1000 plus stores or whatever. So he was saying at the time, though, on that store, it was really important because one miss at that point in time could derail them. Whereas today, you know, they’re very diligent. But when you’re a chain of 1000 stores, if you have one missed it’s not as impactful than if you have 15 stores. And so I think it’s a good point, that first store to grow that first store really matters, right? So
yeah, absolutely. Absolutely. Well, listen, that was a fantastic story. Thank you for sharing. Absolutely. I want to take us to the the last part of the show. We call this retail wisdom. I’ve got three questions for you. Are you ready? Ready? All right. Question one. What extinct retailer Do you wish would come back from the dead? Blockbuster? Hands down?
Mauser 29:16
Faster? I mean, it was just so much fun than nostalgia walking through finding the video touching. I mean, not that everybody you know nowadays people like Oh, come on, yo and attach it and then buying all the snacks. Yeah, Blockbuster for sure.
Ressa 29:32
What is the last item over $20 You bought in a store?
Mauser 29:35
Last item over $20? A pair of vans athletic shoes.
Ressa 29:41
You were your kids? Me? All right. Yeah.
Mauser 29:45
I wore them all weekend to love them.
Ressa 29:48
Alright, you’re styling.
Mauser 29:51
California girl.
Ressa 29:53
Question three. Jessica, you and I were shopping at Target and I lost you were I Oh, would I find you when
Mauser 30:01
I would probably be in that section in the back. That’s the seasonal stuff, where you don’t know what you’re gonna find. Sometimes it’s like the old stuff from last season. You’re like, ooh, that’s cool. I should have gotten that then. But then you could also figure out and then they also had some drinks back there normally. So yeah, I’d be I’d be in that seasonal rotation towards the back.
Ressa 30:22
Excellent. Well, Jessica, thank you so much for coming on the show. This was terrific. I really appreciate it.
Mauser 30:28
I’m so glad we finally did this. This is so much fun.
Ressa 30:36
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