ROSENFELD RESTAURANT REVIEW

THE FLASHBACK DINER  

I read about this place and have been looking to try it for a while. I got my opportunity today at lunch since I was in the area. I just picked up a restaurant listing at 2700 N. Federal Highway so I thought it would be a good time to do it. The place is the former Bova’s restaurant on Federal Highway just South of 20^th St. It is 24 hours so I bet they do a good night and late night crowd.

It is setup like a traditional diner, with a counter you can eat at and a refrigerated case of deserts next to the cash register. But you can see that they are trying to go a little more upscale, and the first evidence of that is the fact that they had 6 or 7 beers on tap. They also had a very fancy cappuccino machine that looked like a spaceship of some sort. Since I sat at the counter I could see all this stuff and talk to the people who worked there. They recommended the French toast so I went with that, along with some turkey sausage well done. Aside from the fact that it was served strangely with the sausage in the middle of the French toast, the food was good. I did ask for the sausage well done, and it could have been more so but they clearly tried. The French toast was tasty but rather small. It was pretty busy in there and there seemed to be very good service. I had at least 3 managerial types ask me if I was being helped while I was there. I think it is going to be tough for them to make it unless they are really killing it at night. There are lots of other breakfast type places on Federal so we will have to see what happens. I am rooting for them and would probably go back if the circumstances were right as they were today. I would love to know about your favorite restaurants or a new place you enjoyed. As always thanks for reading and have a great day.

CARL”S FURNITURE TO CLOSE AFTER 73 YEARS

It seems like almost every day there is another company announcing that they are closing their doors. Many of them had been in business for decades, and it feels like we grew up with them. Seeing their commercials, passing and shopping at their stores, etc. This one is personal for me. Carl’s Furniture was a former client, and I put the surgical center in their headquarters location in Coconut Creek in 2006. I got to know the 2 principals of the firm and am still in touch with one of them now. Fortunately they were not hurt by the failure of the business personally, but the same cannot be said for the former employees. They used to have lost of stores, which all closed over the past few years, and were down to just 3. A combination of poor management and the recession served as a one two punch that knocked them out. The furniture business in general has been decimated, has consolidated and is now finally starting to recover. It is a tough business and getting more competitive all the time. You will continue to see Carl’s Patio stores open, as they split from the parent company in 2008. It is sad to see a local fixture go away but I guess it was just their time. Goodbye Carl’s, you will be missed. Since everything has to be sold in the remaining 3 stores you might be able to get one more deal there. Prices are marked down to 70% off so you might want to check it out if you need any furniture. As always thanks for reading and have a great day.

Carls Furniture closing all three stores

http://articles.sun-sentinel.com/2014-03-12/business/fl-carls-furniture-closing-20140312_1_carls-furniture-carls-patio-city-furniture

Orin Rosenfeld

President

Rosenfeld Realty Advisors

9858 Glades Rd. Suite 209

Boca Raton, FL 33434

Phone: 561-756-1665

Fax: 561-470-0707

Web: www.rosenfeldrealtyadvisors.com

SPRING TRAINING BASEBALL UPDATE

This is sort of a big one. The deal must be in place by May 3rd, which is when the current session of the Legislature ends for the year. The problems they are negotiating are also becoming clear. They want the $50 million dollars that was set aside for this and to be paid out over 37.5 years cut down to 25 years. That is what a typical bond issue time period is. The idea of local tax money flowing in alongside the state money has been discussed. This would be in the form of a hotel tax. Another idea would be to create a special taxing district that would generate “special” property taxes from the business in the area that would benefit from having the stadium there. Lake Worth, realizing that this probably represents the best growth opportunity for their city ever, had the John Price Park site added back into the list of possible sites, despite initial backlash from residents in the area. The mayor, Pam Triolo, was quoted in the article, saying “Our kids need this. There is no better place.” No city would benefit more from getting the stadium than Lake Worth. Gov. Scott says that solving this issue is a priority and saving the jobs it creates. Since they really don’t need additional money for this deal, just to rework what was already allocated, it should work. But a lot needs to be done and the clock is ticking very loudly now. May 3rd is right around the corner and this is an election year. Think about how the voters in Jupiter would feel if this deal doesn’t get done and they lose their spring training revenue? Same can be said for Port St. Lucie as well. I can promise you that they would not be voting for Scott and that is why this is a priority for him now. I really don’t care what the motivation is, as long as they get the deal done. I promise to follow up with this story as soon as there is another update. As always thanks for reading and have a great day.

Palm Beach County to seek more stadium help from lawmakers; could be ‘heavy lift’

http://www.mypalmbeachpost.com/news/news/state-regional-govt-politics/palm-beach-county-commissioners-want-state-lawmake/nd9rd/?icmp=pbp_internallink_invitationbox_apr2013_pbpstubtomypbp_launch

Palm Beach County OKs pursuing baseball stadium deal

http://articles.sun-sentinel.com/2014-03-12/news/fl-baseball-stadium-palm-20140311_1_palm-beach-county-oks-baseball-stadium-deal-spring-training-stadium

Orin Rosenfeld

President

Rosenfeld Realty Advisors

9858 Glades Rd. Suite 209

Boca Raton, FL 33434

Phone: 561-756-1665

Fax: 561-470-0707

Web: www.rosenfeldrealtyadvisors.com

SBARRO FILES CHAPTER 11 AGAIN

Here we go again. For the 2^nd time in 3 years Sbarro is heading down the Chapter 11 highway. While it is not stated in the article, they must be the largest pizza chain in the country that is not a delivery only model (if not them Pizza Hut?). They have 799 stores in over 40 countries, about half of which are in North America. Last month they announced the closing of 155 US stores. There are 2 reasons cited for the poor company performance. One is the business model, which says that people want food made fresh not something that is pre-made and reheated. They point to rivals like Chipotle and Panera Bread as examples of successful quick casual restaurants using the made fresh model (Subway too). But to this I say that pizza is still very popular and I don’t think the fact that it is sometimes reheated is scaring many people away from it. Maybe they want to eat healthier, hopefully that is the larger reason. But I am just speculating there, probably naively. The other reason is decreased mall traffic which hurts Sbarro because most of their stores are in mall food courts. That is what interests me from a real estate perspective. Yes, the recession has curbed traffic mall traffic and consumer spending in general but both are on the rise again now that the economy is recovering. What I think is the real problem is the high rents that they are paying. Speaking in general terms, a tenant pays on the average about 3 times more for retail space at a mall food court than what they would pay for retail space outside the mall. The reason for this is that there should be at least 3 times more traffic and this can be verified in several different ways. Aside from malls, they have some very high profile locations in tourist areas in major cities around the country. Those leases, probably like most of the mall deals, were signed long ago when the market commanded much higher rents. Now they could probably get much better deals, but not on a bulk basis. Why you might ask? Because the locations have multiple landlords and there is no way to coordinate such a thing. So they close stores and try and reinvent themselves. They are working on a concept, based on a Chipotle style, where people can build their own pizza and have it made for them. Makes sense although not sure that is really the issue, but who knows. I wish them well and hope it works out this time around. We all need more pizza out there and Sbarro’s is not so bad if you are stuck in an airport sometime. As always thanks for reading and have a great day.

Struggling Pizza Chain Sbarro Seeks Bankruptcy Protection Again

http://www.nytimes.com/2014/03/11/business/struggling-pizza-chain-sbarro-seeks-bankruptcy-protection-again.html?partner=rss&emc=rss&_r=0

Orin Rosenfeld

President

Rosenfeld Realty Advisors

9858 Glades Rd. Suite 209

Boca Raton, FL 33434

Phone: 561-756-1665

Fax: 561-470-0707

Web: www.rosenfeldrealtyadvisors.com

PNC BANK GROWING IN SOUTH FLORIDA

Look out TD Bank. There is another player in the banking business that is looking to grow and they are making serious progress. PNC Bank opened 10 branches last year, and plans 4 more branches this year. All of these locations are in Broward County, and PNC expects to have 81 branches in South Florida by the end of the year. As we have talked about in the past, many banks have chosen to expand by acquiring other banks, and PNC is no exception. They bought both RBC Bank and National City and are rumored to be looking at others. With 54 locations in Palm Beach County, they have more market share (6.3%) than SunTrust, TD Bank, BB & T, Citibank and Bank United. Unfortunately Dade County is the weakest link for PNC now, with only 2 branches but they are looking to change that. The problem is that they are hitting the market at a peak time, so we will see how this all works out for PNC. The problem is that those corner parcels that they seek for branch sites are in high demand in Dade right now, with interest from banks, restaurants and gas stations. Banks can and will pay the most for a site, so unless TD is bidding against them they might be OK. I think we will see more banks being acquired to pave the way for expansion than new branch development going forward. But expect to see a PNC opening on a corner near you, especially if you live in Broward or Dade Counties. There is another interesting nugget in here that is worth sharing: 80% of bank customers bank online, by phone or ATM. So why do banks need so many locations? The evolving answer is that they don’t, and we will see that play out in the years to come as the banking industry continues to change. Technology makes things more efficient, which means less people are needed, less jobs, real estate, etc. so it will also be interesting to see how everything else changes with it.

PNC Bank heating up with Florida economy

http://articles.sun-sentinel.com/2014-03-08/business/fl-pnc-broward-branches-opening-20140308_1_pnc-bank-national-city-branches

Orin Rosenfeld

President

Rosenfeld Realty Advisors

9858 Glades Rd. Suite 209

Boca Raton, FL 33434

Phone: 561-756-1665

Fax: 561-470-0707

Web: www.rosenfeldrealtyadvisors.com

SPRING TRAINING BASEBALL UPDATE

Oh yes, we have a lot of info here to share with you. This past week the Washington Nationals and Houston Astros have been in discussions with Palm Beach County officials regarding a potential spring training baseball site. They have been discussing 10 potential sites in Palm Beach County and if the teams select one of them it will have a tremendously positive economic impact on the city and site they select. It was finally revealed where the 10 sites are. I was stunned (and exhilarated at the same time somehow) to see that one of those sites was just a few miles from my house in West Boca Raton. It is the site on Glades Rd. West of 441. Not surprisingly, this very important decision seems like it will come down to money, like most decisions. The problem with this whole deal is that there are hidden costs. If the Nationals and or Astros can’t make a deal for one of the sites there will only be 3 teams in South Florida. That triggers a termination option in all 3 of their leases allowing them to leave the area. So really this negotiation isn’t just about finding a home for one or two more teams, it is about retaining 3 and adding one or 2. And there would be a huge economic impact either way. I have been to 2 games so far and if you haven’t been to Roger Dean Stadium for one you really should go. If you do, you might be surprised by what you see there. When the St. Louis Cardinals play, who share the stadium with the Miami Marlins, virtually all the fans are from the Midwest. They are all wearing either hats, shirts or shorts (many time all or combinations of these) that are red in color. They patronize the hotels, bars and restaurants in large numbers. They come down here for the weekend, the week and some even come for the whole spring training season to see their beloved Cardinals. Ask the people in Jupiter how they would feel if spring training baseball went away. How would these businesses survive there? They wouldn’t and we would lose one of the best things about February and March in South Florida, spring training baseball. We will have an update on this very soon, as a decision must happen quickly if this deal is to happen at all. My fingers are crossed!  

New spring training plans in Palm Beach County face money hurdles

http://www.palmbeachpost.com/news/news/new-spring-training-plans-in-palm-beach-county-fac/nd7gr/

Baseball teams, county may seek more state help for stadium deal

http://articles.sun-sentinel.com/2014-03-07/news/fl-baseball-stadium-talks-20140307_1_stadium-deal-new-stadium-spring-training-stadium

Orin Rosenfeld

President

Rosenfeld Realty Advisors

9858 Glades Rd. Suite 209

Boca Raton, FL 33434

Phone: 561-756-1665

Fax: 561-470-0707

Web: www.rosenfeldrealtyadvisors.com

STAPLES TO CLOSE 10% OF US STORES

Talk about the power of the internet. We just blogged last week about how one of the largest real estate firms in the world shorted their name because of it. Today the market leader in office products announced that they would be closing 10% of their North American stores because of it. They are doing very well, leading their market and soundly beating rival Office Depot/Office Max, who is struggling to integrate after their merger. No, the reason for these store closures is because about half of their sales are online now! They just don’t need that many stores anymore. Wow that is really efficient, but there is some fallout. Less stores means less employees, means less jobs and less retail occupancy. So the company saves money and becomes leaner with a human expense, which is almost always how technology works. When you see something happen this big you can’t help but wonder who and what is next. If you could predict that you could profit from it handsomely I am sure. We already wrote here about how Walmart and Target were getting smaller store formats, and growing them rapidly. This is the way of the world now, less is more. What will the internet downsize next? How much power does it really have and for who? We will keep an eye on this going forward. You can almost be sure that Office Depot will be following suit at some point, probably in a year or 2. Want to bet? As always thanks for reading and have a great day.   

Staples to close 10 percent of North American stores

http://www.bizjournals.com/boston/news/2014/03/06/staples-to-close-10-percent-of-north.html?ana=e_du_nat&s=article_du&ed=2014-03-06

Orin Rosenfeld

President

Rosenfeld Realty Advisors

9858 Glades Rd. Suite 209

Boca Raton, FL 33434

Phone: 561-756-1665

Fax: 561-470-0707

Web: www.rosenfeldrealtyadvisors.com