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Mathis Report: Krystal plans to tear down, rebuild stores
October 11-17, 2018
PAGE 4
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JACKSONVILLE
Record & Observer SIGNS OF CONCERN IN ARLINGTON Record & Observer
Web.com approves Siris buyout
JACKSONVILLE
$2.2 billion deal will turn company private.
Business owners say new sign rules and other changes that are part of a plan to improve area could cost them thousands.
BY MARK BASCH
JACKSONVILLE
Record & Observer CONTRIBUTING WRITER
JACKSONVILLE
Shareholders of Web.com Group Inc. easily approved a buyout by a private equity firm Wednesday morning, clearing the way to close the deal Thursday. Affiliates of Siris Capital Group LLC agreed to buy the company in a deal valued at $2.2 billion. Web.com CEO David Brown said Wednesday that taking the publicly traded company private will help its business going forward. “We don’t have to grow for the sake of growth” to impress Wall Street, he said. “We’re looking at profitable growth.” Brown said the buyout will not result in major changes for Web.com, Brown wh i c h p ro vides website development and marketing services for small and medium-sized businesses. “It’s going to be business as usual,” he said. Siris agreed to buy Web.com in June as the company was planning a move to a new 218,700-squarefoot headquarters building. Although most employees will not be impacted by the buyout, Brown has not said if he will remain as CEO or if there will be other executive changes. Brown said the company plans an announcement Thursday about executive roles. The buyout agreement was approved by about 99 percent of shares voted, representing 78 percent of all shares outstanding, the company said.
Record & Observer SEEKING CHANGES
Mike Anania, owner of Cam Automotive along Arlington Road, said it would cost his shop “hundreds of thousands of dollars” because proposed new rules would ban open bay doors that face the street.
SIGN CHANGES
According to the proposed changes for Arlington, properties less than 5 acres can’t have road signs taller than 6 feet, and pole-mounted signs, billboards, animated and other digital signage would be prohibited.
Photos by David Cawton
BY DAVID CAWTON STAFF WRITER
A
plan to improve Arlington that would create new rules for road signs and landscaping isn’t sitting well with a group of property and business owners. If approved by City Council, a new zoning overlay would create a set of standards for properties in the Renew Arlington Community Redevelopment Area. The city has five CRAs, which are special funding districts created to spur economic development in blighted areas of cities or counties.
Report finds child poverty on the increase in Duval County PAGE 3 Deceptive mail campaign targeted business, Realtors PAGE 10 OBSERVER MEDIA GROUP
In 2015, council members approved the creation of the Renew Arlington CRA that includes property along three corridors in Arlington: University Boulevard from the Arlington Expressway to Fort Caroline Road; Merrill Road from University Boulevard to Interstate 295; and a section of Arlington Road from University Boulevard to Rogero Road. The city Planning and Development Department, council members, business organizations and property owners are working on a final zoning overlay. When adopted, about 1,300 SEE ARLINGTON, PAGE 8
MBASCH@ JAXDAILYRECORD.COM
THE BASCH REPORT
KB Home has big plans for Jacksonville, CEO says Plus: CSX chairman is retiring PAGE 6 VOLUME 1, NO. 19 • ONE SECTION
WHAT’S TRENDING
Page 2 • Thursday, October 11, 2018
Jacksonville Daily Record/Jacksonville Record & Observer
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Photo by Karen Brune Mathis
Springfield United is planned at 1401 N. Main St.
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Ice cream shop with beer planned for Springfield European Street Cafe co-owner Andy Zarka is working on a new concept for Springfield – a soft-serve ice cream shop that also sells beer and wine. “This is something that the neighborhood doesn’t have now. The time is right,” Zarka said. Springfield United is planned at 1401 N. Main St. in a former auto repair shop that property records show was built in 1930. He intends to lease and convert the almost 2,000-square-foot building into a neighborhood amenity. Zarka owns four European Street Cafes with his mother in Riverside, San Marco, Jacksonville Beach and along Beach Boulevard near University Boulevard. He and his wife, Marlo, will own Springfield United. The Zarkas and their daughter, Amelia, 12, moved to Springfield from Riverside in March 2017. “We absolutely fell in love with the neighborhood,” he said. Referring to the retail and restaurant development along Main Street, he said, “we wanted to be a part of it.” Zarka said Springfield United will offer soft-serve ice cream, cones and dipped cones, banana splits and the like. “This is not artisanal,” he said. It will offer soft drinks, canned local beer and macrobrewery heritage drafts on probably four taps.
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Jacksonville Daily Record, Jacksonville Record & Observer and Realty-Builder are a division of Observer Media Group Inc. Established in 1912, the Financial News & Daily Record, now the Jacksonville Daily JACKSONVILLE Record, is published Monday-Friday and is the Official Court Newspaper of the Circuit Court and publisher of public notices in Duval County. Jacksonville Record & Observer is a free weekly business newspaper available in Downtown Jacksonville and key business nodes throughout Jacksonville. To find a location near you, visit jaxdailyrecord.com/rack-locations. Editorial content focuses on news and trends, with a concentration on development, law, companies, economic and industry trends and how local and state government affects business. Realty-Builder is a monthly publication connecting Northeast Florida’s real estate professionals and homebuilders. Content focuses on timely news, information and trends affecting residential real estate sales and construction, as well as events and legal issues impacting the industry. Visit Realty-Builder.com to request your free copy.
Rayonier plans to add 79 jobs Downtown
STAFF
Rayonier Advanced Materials said Tuesday it will create 79 positions at its Downtown headquarters by 2022, following its acquisition in late 2017 of Canadian forest products company Tembec. The company said the jobs will be professional and administrative roles to support its international operations and will average $69,520 annually. A news release said the Tembec purchase almost doubled Rayonier Advanced Material’s size to more than $2 billion in annual revenue and added more than 15 operating plants in Canada and Europe. The release said the expansion also secures 80 full-time jobs that are based at the company’s global headquarters Downtown in Riverplace Tower on the Southbank.
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Mattress Firm to close hundreds of stores Mattress Firm Inc. filed for Chapter 11 bankruptcy reorganization and plans to close hundreds of stores. According to court filings obtained by USA Today, 10 Florida stores will close in the first wave of 200, including one in Jacksonville at 6337 Roosevelt Blvd. in the Target-anchored center. Mattress Firm operates 20 stores in Northeast Florida, according to its website. The company plans to close 700 stores leading up to the holiday season “in certain markets where we have too many locations in close proximity to each other,” said Mattress Firm CEO Steve Stagner. Houston-based Mattress Firm says on its website it has more than 3,000 stores across 49 states.
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Brad Thoburn was named Michael Baker International vice president and Southeast regional transportation and surface transportaThoburn tion planning lead. Thoburn is responsible for development and management of the Southeast region’s transit and planning business plan and growth strategy. Thoburn most recently was vice president of planning and development at the Jacksonville Transportation Authority. North Florida Land Trust added two board members. Allison DeFoor is an Episcopal priest and serves as Canon to the Ordinary to the Bishop of the Diocese of Florida in DeFoor Jacksonville. DeFoor has experience in Florida conservation programs. Mike Barker, a partner with Terra Capital Holdings Inc., has experience in real estate con-
sulting and investments. Hyatt Regency Jacksonville Riverfront added two sales team memBarker bers. Josh Hoce is associate director of sales. He has more than 10 years of experience in the Jacksonville market in the hotel industry and at Visit Jacksonville. Hoce will be responsible for management of large specialty groups such as professional sports and religious groups. Laura Gonzalez Pena was named meeting connections/business travel sales manager. Most recently, Pena served the Hyatt Regency Orlando as business and leisure travel coordinator. Chris Glenn joined Orange Park Medical Center as chief financial officer. Glenn has been with Hospital Corporation of America for 11 years and most recently served as chief financial officer at TriStar Greenview Regional Hospital in Bowling Green, Kentucky.
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POSTAL INFORMATION Jacksonville Daily Record (USPS 190-620) is published daily except Saturday, Sunday & legal holidays (New Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas) by Daily Record & Observer LLC, 10 N. Newnan St., Jacksonville, FL 32202. Periodicals postage paid at Jacksonville, Florida and at additional mailing offices. Under no circumstances will any news or records of Duval County be suppressed for anyone. Information in this newspaper is for our subscribers only and must not be used by anyone for publication purposes.
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Jacksonville Daily Record/Jacksonville Record & Observer
Thursday, October 11, 2018 • Page 3
Report: Child poverty increasing in Duval Florida poverty rates 2015
BY MARK BASCH
Duval and Baker counties exceeded the state average for poverty in 2015. Under 5 County All ages Under 18 Age 5-17 (2014)
CONTRIBUTING WRITER
As the state’s population continues to grow, the number of Floridians living in poverty is growing with it. Particularly alarming is the high poverty rate for children under age 5, with Duval County having one of the sharpest increases in that rate in the state, according to the Florida Chamber Foundation. As the foundation looks at where Florida will be in 2030, addressing poverty among young children is a key concern. “The sooner we can move them from poverty, the sooner society can see the benefits of keeping children in a positive environment. This population will be part of Florida’s workforce for the year 2030 and beyond,” the foundation said last year in a report on poverty. The report, citing the most recent U.S. Census data, said 3.129 million Floridians were living in poverty in 2015, 15.8 percent of residents.
Baker 16.8% 24.2% 23.1% N/A Clay 11.6% 15.7%
14.1% 17.6%
Duval 16% 25.4% 24.4% 30.4% Nassau 10.8% 16%
14.8%
11.5%
St. Johns
8.9%
6.2%
22%
26.5%
9.8%
10.1%
Florida 15.8% 23.4%
Sources: Florida Chamber Foundation, U.S. Census
That’s higher than the national poverty rate of 14.7 percent. In 2015, the federal poverty level was $24,250 in annual household income for a family of four. The poverty rate for children under age 18 in Florida was 23.4 percent and the rate for children under 5 was 26 percent. St. Johns County, one of the
wealthiest counties in the state, had the lowest poverty rate for children under age 18 at 10.1 percent, but nearby Putnam County had one of the highest rates at 41.1 percent. Duval County’s poverty rate for children under 18 was 25.4 percent. Data for children under 5 years old is available only for Florida’s
40 largest counties, and it again shows St. Johns with the lowest poverty rate at 6.2 percent in 2014. However, Putnam had the highest rate by far among the 40 counties at 56.3 percent. Duval County’s poverty rate for children under 5 was 30.4 percent, a few points above the statewide rate.
However, Duval’s rate rose sharply from 17.4 percent in 2008. The foundation advocates focusing on programs to help lift young children out of poverty. “Children birth to age 9 should be a focus with the projections for growth in poverty populations given Florida will have to prepare if it wants to be ready for 2030,” its report said. “Age 9 is an important milestone given it typically aligns to the third grade. Third grade reading proficiency has been correlated with high school graduation rates and career success and is critical to alleviating future poverty.” Florida is growing by about 1,000 residents each day, and that will put a strain on resources to help families in poverty. “The sheer number of Floridians living in poverty in our state impacts not only individual families, but also businesses, Florida’s economy and our state’s global competitiveness,” the report said. “There is significant need to better understand the number of children and families in poverty, where they reside, and potential limitations in current social service delivery that might impede economic selfsufficiency.” MBASCH@ JAXDAILYRECORD.COM
DEVELOPMENT TODAY
BUSINESS IN BRIEF
These are the largest commercial building permits by job cost issued Tuesday by the city of Jacksonville.
FSCJ selects executive search firm: Florida State College at
CHURCH, OTHER RELIGIOUS The Church of Eleven22 Inc., 14286 Beach Blvd., No. 1, contractor is Bradley Bowen Development Inc., 60,000 square feet, alteration, $30,000.
contractor is Dav-Lin Interior Contractors Inc., 27,666 square feet, tenant build-out, $47,000. Multimedia Holdings Corp., 1070 E. Adams St., contractor is Preferred Builders of North Florida Inc., alteration, $18,000.
HOSPITAL, INSTITUTIONAL
SIGNS
Heartland Health Care Center Jacksonville, 8495 Normandy Blvd., contractor is Williams & Rowe Co. Inc., generator upgrade, $200,000.
VyStar Credit Union, 1600 Hendricks Ave., contractor is Heritage Signs Inc., three permits for wall and monument signs, $25,200. SouthMorr, 1010 E. Adams St., contractor is Kenco Sign and Awning LLC, ground sign, $11,300. Beacon Fisheries, 7357 Digital Circle, contractor is Taylor Sign & Design Inc., two permits for wall signs, $10,000. Mama Laura’s Sweet Treats, 13529 Beach Blvd., No. 204, contractor is Taylor Sign & Design Inc., wall sign, $5,200. Urgent Care, 11985 Atlantic Blvd., contractor is General Sign Service Corp., three permits for wall signs, $2,700.
OFFICE, BANK, PROFESSIONAL CSX Transportation Inc., 500 Water St., contractor is Duckworth Construction Co., 21,617 square feet, renovate 14th floor, $2.82 million. America’s Auto Auction, 11982 New Kings Road, contractor is Crabtree Construction Co., 2,920 square feet, addition, $250,000. Veritiv Corp., 4901 Belfort Road, No. 160, contractor is Terry Adams Inc., 13,400 square feet, renovation, $144,285. Safariland LLC, 4101 Bulls Bay Highway,
Compiled by Scott Sailer
ECONOMIC TRENDS
Citing U.S. Census data, Florida Chamber Foundation finds 15.8 percent of the state’s residents living in poverty in 2015.
Jacksonville selected AGB Search of Washington, D.C., to help it find its next president. The college said in a news release it is negotiating a contract with the search firm. The college has been without a president since Cynthia Bioteau retired May 31 after four years as president. Kevin Hyde, a partner at Foley & Lardner, became interim president after a search for the interim position was completed before Bioteau’s retirement.
Cowford Chophouse awarded: The Cowford
Chophouse, 101 E. Bay St., was named one of Florida’s top 10 buildings in the Florida Association of the American Institute of Architects 2018 People’s Choice Awards. Cowford competed against 39 buildings statewide in the competition, which highlights architecture that helps meet the needs of communities through innovative design. Jacksonville-based architecture and interior design group Design Cooperative and Danis Construction restored the historic Bostwick Building into the restaurant, owned by Jacques Klempf.
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Page 4 • Thursday, October 11, 2018
Jacksonville Daily Record/Jacksonville Record & Observer
THE MATHIS REPORT
Krystal to tear down, rebuild two stores
KAREN BRUNE MATHIS EDITOR
86-year-old burger chain plans to demolish two Jacksonville stores and replace them with its new prototype. Jacksonville, with 30 Krystal stores, is a top-five market for the 86-year-old hamburger brand. Now it also will be one of the first Florida markets to sport the new prototype. In a $2 million project, The Krystal Co. intends to start its first two “scrape and builds” in Jacksonville to demolish the old and build anew. Those will be followed by three or four more over the next few years. The first area Krystal to be rebuilt with a new prototype will be in South Jacksonville. Each scrape-and-build is a $1 million project and uses local contractors, the company said. It takes about 120 days. Krystal intends to demolish its restaurant and drive-thru at 5707 University Blvd. W. and build a replacement that spokeswoman Laura Mansfield said will be among the first of its kind in the state. The city is reviewing applications for demolition of the existing store and construction of a 2,030-square-foot Krystal. The existing 2,221-squarefoot building was developed on about a halfacre in 1970 at University Boulevard West and Barnes Road, according to Duval CounMacaluso ty property records. Mansfield said the second will be the 2023 N. Main St. location. That 2,640-squarefoot location was built on 1.2 acres in 1990. She anticipates the stores will close in the second quarter of 2019 and reopen in the third quarter. Krystal operates 350 quickservice hamburger locations among 11 states. The company said it will redesign 75-100 restaurants over the next five years, representing about 40 percent of its corporate portfolio. In Jacksonville, 19 of the stores are company owned and of those, five or six will be rebuilt, Mansfield said. Mansfield said sales are up by more than 50 percent at the redesigned stores in Jackson, Mississippi, and Tuscaloosa, Alabama. She said Krystal expects a 30 percent increase from the Jacksonville redesign. The company relocates employees to other Krystal locations during renovations. The new stores add staff for the increased business, she said.
KRYSTAL SEEKS A FRESH LOOK Krystal has 30 stores in Jacksonville, including on at 5707 University Blvd., above. Krystal plans to tear down the 48-year-old store next year and replace it with its new concept, left. It will do the same with its store at 2023 N. Main St.
Photo by Karen Brune Mathis
Special to the Daily Record
“The redesign is part of a companywide initiative to improve the dining experience for our guests and adapt to changes in consumer behavior,” said Krystal CEO Paul Macaluso in a statement. He said the company is seeing more drive-thru business, especially late at night and at breakfast. Macaluso said the drive-thru design is built for speed and serviceability with a single window, expanded work zone and double drive-thru lane. Krystal, based in Dunwoody, Georgia, was founded in Chattanooga, Tennessee, in 1932. Krystal is controlled by Atlanta-based Argonne Capital Group, which said in May it completed a transaction with blue-chip institutional investors that put about $530 million in six companies controlled by Argonne. QSR Magazine reported in June that when Macaluso, the former president of McAlister’s Deli, joined Krystal as CEO in April, one of his first targets was to reinvigorate “the relevance of the brand.” According to QSR, Macaluso said Krystal was in danger of becoming “wallpaper” to once-loyal customers and being overlooked by new ones. His goal, according to the magazine, was to get people talking again about the brand. Sales dropped more than 6 percent in the previous two years. His answer: “Breakthrough creative that gets people’s attention.” QSR reported that Krystal partnered with The Tombras
Group for its social media work and MoonPie, which spars with Wendy’s on Twitter, to launch an unconventional advertising campaign “that invigorates the venerable burger brand with an appeal to millennials and a nod to pop culture.” In September, Krystal announced the reopening of a Tifton, Georgia, restaurant, the first scrape-and-build in the state. Krystal said the prototype was made with three primary building materials – wood, metal and stucco – for ease of construction. The kitchen and facilities layout maximizes efficiency and employee awareness, it said. It said design elements “include a vibrant color package highlighting the Krystal name in red, a heritage color for the brand.” Architecturally, the building is both contemporary and nostalgic, it said, with a full-glass front and a wood-framed open ceiling in the dining room. The building is square like Krystal’s burgers. Krystal said 40 percent of its restaurants are more than 40 years old.
JinkoSolar issued permit to build-out plant at Cecil JinkoSolar (U.S.) Industries earned a city permit last week to build-out the solar panel plant it is setting up in AllianceFlorida at Cecil Commerce Center. The city Building Inspection Division issued a permit for
RESTAURANT NOTES
Panera for Shoppes at Bartram Park Panera Bread is working on developing a restaurant at 13760 Old St. Augustine Road in the Shoppes at Bartram Park. The 4,425-square-foot restaurant is planned in 1.21 acres. Panera Bread is shown on a Regency Centers site plan as leasing an inline space now. Regency Centers said Panera Bread has been at the center since 2005. n Mack’s Tenders intends to open at 8738 Baymeadows Road in unit 103 in the Bay95 retail center. The website said it would open in late October and will operate daily from 11 a.m. to 9 p.m. Its menu focuses on chicken tenders, 30 sauces and side dishes. n IHOP took out a business license for its store at 3250 Hodges Blvd. in Hodges Pointe Plaza. It converted a former Bob Evans Restaurant. It is the fourth IHOP in Jacksonville. n Dunkin’ Donuts and Circle K will share a building that SunCoast Industrial & Construction Services Inc. will develop at 3631 Blanding Blvd. The city issued a permit for construction of the 5,000-square-foot building at a job cost of $350,000. n Miller’s Ale House filed site development plans with the city for the Buca di Beppo site at 10334 Southside Blvd. Miller’s Ale House proposes a 7,149-square-foot restaurant at the site. Buca di Beppo closed late last year.
Hoffman Commercial Construction LLC for the $13.85 million project for interior construction and plant renovation. JinkoSolar agreed to open a 200-job, $50 million plant at AllianceFlorida with the support of city and state incentives. The jobs, which will pay an average annual $45,562, must be created by the end of 2019. The solar panel manufacturer will lease 285,652 square feet
in the 407,435-square-foot building at 4660 POW-MIA Memorial Parkway. E-commerce furniture distributor Industry West will occupy the rest. The JinkoSolar space includes manufacturing, warehouse, research and development along with room for other functions. Work already was underway toward the build-out. In July, the city approved a permit for
Jacksonville Daily Record/Jacksonville Record & Observer interior structural work at a job cost of $2 million. KBM Builders Inc. is the contractor listed for that build-out. The city also approved the $150,000 construction by KBM Builders of a tenant separation wall to divide the building for JinkoSolar and Industry West, which will lease 121,783 square feet. The city is reviewing a permit application for a $305,000 installation of IT racks and other electrical equipment for JinkoSolar. JinkoSolar is part of Shanghai, China-based JinkoSolar Holding Co. Ltd. Financial support comprises city tax incentives of $3.4 million, consisting of a $3.2 million Recapture Enhanced Value grant to be paid over 10 years and a $200,000 Qualified Target Industry tax refund for JinkoSolar to be repaid over five years. The state will pay the remaining $800,000 of the total $1 million QTI refund. JinkoSolar’s first major customer — NextEra Energy, parent company of Florida Power & Light Co. — was announced in March.
More Dollar General stores on the way Dollar General is moving toward development of an Eastside area store at 1040 E. Eighth St. at Florida Avenue. The city issued a mobility fee calculation certificate for the proposed 7,500-square-foot project on 1.37 acres. Concept Development Inc. of Gainesville is the agent and The Perfect Score Realty Group II LLC is the property owner. A JEA service availability letter refers to the project as Dollar
Thursday, October 11, 2018 • Page 5
RETAIL NOTES
Bozard buys old Gander Mountain site Bozard Ford Co. bought the former Gander Mountain property at 550 Outlet Mall Blvd. in St. Augustine for a Bozard Lincoln dealership. The company paid $5.6 million for the property, acquiring it from U.S. Bank as the trustee. St. Johns County is reviewing an application for Bozard to convert the closed Gander Mountain store on 7.5 acres into a Bozard Lincoln dealership. Bozard Land LLC owns 10 acres next door at 540 Outlet Mall Blvd. where Bozard Ford Lincoln now operates.
Special to the Daily Record
Dollar General appears to have at least four more stores planned for Jacksonville.
General. A $61,547 mobility fee was calculated to mitigate the traffic impact. Dollar General also appears to be the potential project on vacant commercial property at 103rd Street and California Avenue in West Jacksonville. Concept Development Inc. proposes to develop a 7,500-square-foot commercial retail store on the 1.1-acre site. The city calculated a mobility fee of $70,974 to mitigate the traffic impact. No store was identified on plans, although Gainesvillebased Concept Development has developed several area Dollar General stores. Dollar General is building a store at 7194 Wilson Blvd. The 7,512-square-foot store will be developed on 1.03 acres at Wilson Boulevard and Firestone Road in Westside at a job cost of $296,985. Concept Companies also wants to build a 7,500-squarefoot retail store at northwest Post Street and McDuff Avenue
South near Riverside, according to a JEA service availability letter. No tenant is identified.
Kernan West sites sold for apartments, gas station Northwest Kernan and Butler boulevards can take shape with apartments and a Daily’s gas station and convenience store now that the property has been sold. Bainbridge at Town Center Owner LLC bought 17.09 acres, including a pond, from members of the Skinner family at northwest Kernan and Butler boulevards for development of a 276-unit apartment complex. It paid $6.7 million for the land and took out a $29.43 million mortgage from Synovus Bank. First Coast Energy LLP paid $3.286 million for 2.85 acres there from the Skinners. First Coast Energy spokeswoman Andrea Kane said there is no construction timetable for the Daily’s station. It intends to start construction
n CVS Pharmacy is building in East Arlington next to a new Wawa gas station and convenience store. CVS applied to the city for the $900,000 construction of a 13,250-square-foot store on 1.18 acres at 11900 McCormick Road. No contractor is identified. CVS said in April it intended to open there in July 2019. The site at southwest McCormick and Monument roads is about a mile from space CVS leases at 1531 Monument Road in the Monument Pointe Plaza. n RaceTrac Petroleum Inc. intends to develop a 5,400-squarefoot gas station and convenience store at 8715 Baymeadows Road, the site of a closed Wells Fargo bank branch. The city is reviewing a permit application for Venture Construction Co. to build the project on 1.42 acres at a cost of $1.2 million for the building, canopy and dumpster enclosure. RaceTrac applied for a certificate of use for the site. It’s at least the fourth new RaceTrac under construction or in planning in Jacksonville. RaceTrac operates at least 17 stores in Northeast Florida.
on the Baymeadows location in mid-2019 and open it by the end of the year. Another 2.23-acre parcel remains available. The property is south of the University of North Florida.
Wells Lake Commerce Center is sold Keith Goldfaden, Daniel Burkhardt and Luke Feldman of NAI Hallmark and Stuart Duffin of NAI Southcoast announced Tuesday they represented the seller in the sale of Wells Lake
Commerce Center in Orange Park to an affiliate of Lat Purser & Associates, based in Charlotte, North Carolina, for $6,795,000. It comprises four single-story office buildings totaling 52,620 square feet and is 81 percent occupied. Tenants include Maple Street Biscuit Company, Cemex, Kindred Healthcare and Wyle Laboratories. KMATHIS@ JAXDAILYRECORD.COM @MATHISKB (904) 356-2466
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Page 6 • Thursday, October 11, 2018
Jacksonville Daily Record/Jacksonville Record & Observer
THE BASCH REPORT
KB Home has big plans for Jacksonville “Right now, we’re fourth in Jacksonville. We don’t want to be fourth.
MARK BASCH CONTRIBUTING WRITER
We’d rather be first,
CEO of national homebuilder says purchase of Landon Homes gives company control of more than 2,000 lots. After acquiring Landon Homes in July, KB Home is expecting big growth in Jacksonville, CEO Jeffrey Mezger said in the Los Angeles-based homebuilder’s quarterly conference call. “We are currently the fourth-largest builder in this market based on deliveries, and our position will be enhanced in 2019 and beyond with this acquisition,” Mezger said. “Our local team is moving quickly, having completed the rebranding to KB Home and the introduction of our product in all but one active community that we acquired,” he said. Mezger said the assets of Jacksonville-based Landon gave KB “2,100 lots that we now own or control across 17 communities, eight of which are open today and nine communities which will open over the next 18 to 21 months.” When the deal was announced in July, KB said it acquired 700 lots from Landon. A KB spokeswoman said last week the 2,100 lots Mezger cited include future opportunities resulting from the Landon deal. In response to analysts’ questions, Mezger explained why KB targeted Landon. “If you look at Jacksonville, it’s a great story in that their product was aligned with ours. We like our floor plans better, but the footages and the price points were similar, and the geographic complement of where they were open versus where we were open was also very good,” he said. Mezger said KB already had “a great business in Jacksonville” and it was quickly able to “plug and play” its business into the Landon communities. “Right now, we’re fourth in Jacksonville. We don’t want to be fourth. We’d rather be first, second, third and this will help us to get there. So, it’s really a pretty quick hit deal at a very reasonable price.” KB has not disclosed the terms of the deal. KB reported revenue for its third quarter ended Aug. 31 rose 7 percent to $1.23 billion, and its earnings per share rose by 36 cents to 87 cents.
Taylor Morrison enters Jacksonville Another national homebuilder targeting Jacksonville is Taylor Morrison Home Corp., which entered the market last week by completing its acquisition of AV Homes. AV Homes, headquartered
second, third and this will help us to get there.” JEFFREY MEZGER, KB HOME CEO
Special to the Daily Record
in Scottsdale, Arizona, as is Taylor Morrison, operated in five communities but four of them overlapped with existing Taylor Morrison operations. The $963 million acquisition gives Taylor Morrison entry into the Jacksonville market. In a memo to employees in late Cregg September, AV Homes CEO Roger Cregg said Jacksonville employees will be able to continue working in their current offices because Taylor Morrison doesn’t have operations in the area. He also tried to assure employees that the deal will be positive for them. “As we near close, Taylor Morrison is planning ‘Day One’ celebrations for our arrival — something I believe is a true testament to the type of organization we will be joining. Taylor Morrison is known for their people-first focus, and I know they are delighted to be welcoming us into the special culture they have created,” Cregg said.
Kelly retiring as CSX chairman CSX Corp. announced Friday that Chairman Edward Kelly is retiring from the board of directors in January. Kelly has served on the board since 2002 and became chairman in March 2017, when the late Hunter Harrison joined the Kelly Jacksonvillebased railroad company as CEO. Previous CEO Michael Ward also had served as chairman of the board. Kelly will be succeeded as chairman by John Zillmer, former CEO of Fortune 500
company Univar Inc. Zillmer joined CSX’s board when Harrison came in as part of a sweeping overhaul of management and the board of directors. In a news release, CSX Chief Execu- Zillmer tive James Foote said Kelly “guided us with exceptional skill through many turbulent moments” during his tenure as chairman.
International Baler names Biazis CEO Jacksonville-based International Baler Corp. last week named Victor Biazis as president and CEO. Biazis had been running a Ponte Vedra Beach-based industrial adhesives company he founded called Coastal Industrial Products. Biazis succeeds William Nielsen at InternaBiazis tional Baler, with Nielsen returning to his previous role as chief financial officer. Nielsen has been chief financial officer of the publicly traded manufacturer of baling equipment since 1994. He became CEO in January 2017 after previous chief executive Roger Griffin resigned.
Synnex closes Convergys deal Synnex Corp. last week closed its $2.8 billion acquisition of Convergys Corp. California-based Synnex is merging the operations of Convergys into its outsourced customer service business called Concentrix. With the merger, Concentrix will operate 275 offices in more than 40 countries, with 225,000 employees.
Cincinnati-based Convergys said when the merger was announced in June that it had about 1,000 employees in Jacksonville, but employment levels have varied over the years as customer contracts were won and lost. The Jacksonville operations trace their roots to a business created by AT&T in 1983 to handle shareholder services after the court-ordered breakup of the telephone company. As that business expanded to handle outsourced customer services for other companies, it employed more than 4,000 at its peak.
Analyst downgrades Landstar System Landstar System Inc.’s stock has been trending down since reaching a record high a month ago, but one analyst still downgraded the Jacksonville-based trucking company last week. Wolfe Research analyst Scott Group downgraded his rating on Landstar from “peer perform” to “underperform” as he lowered ratings on eight trucking stocks. “While Landstar has underperformed recently, the stock is still up 13 percent yearto-date, outperforming our overall coverage and the S&P 500,” Group said in his research report. “Landstar has by far the most exposure to the spot market and thus has seen very strong revenue and earnings growth this year. However, truckload spot rates have recently inflected negative year over year and thus we see increasing earnings risk for Landstar going forward.” Group also said “about onethird of Landstar’s revenue is tied to flatbed and thus levered in part to the housing market where we expect incremental weakness given rising rates.” Landstar’s stock had fallen from a record high of $128.70 on Sept. 11 to $115.71 Friday before Group’s downgrade Group lowered his rating on
the entire trucking sector from “market weight” to “market underweight,” based on expectations that earnings will peak next year. “While freight fundamentals have been terrific over the past year, we expect fundamentals to moderate over the next couple of years given increasingly tough comps, moderating stimulus from tax reform by late 2019, and rising rates and overall inflation,” he said.
International Speedway earnings rise on event timing
Daytona Beach-based International Speedway Corp. last week reported a big increase in third-quarter earnings, helped by events held this year but not in the third quarter of 2017. The company, which operates the Daytona International Speedway and 12 other motor sports facilities, reported revenue rose 21 percent in the quarter ended Aug. 31 to $159.3 million, and adjusted earnings rose by 20 cents to 26 cents a share. Several events in the Kennedy third quarter contributed to the higher revenue, including NASCAR race events in Chicago that took place in the fourth quarter last year and the Ferrari World Finals race at Daytona International Speedway, which was not held there in 2017. The company also is benefiting from new venues opening at its One Daytona retail, dining and entertainment complex adjacent to the Daytona Beach speedway. In a news release, CEO Lesa France Kennedy said the higher third-quarter results were in line with the company’s expectations. MBASCH@ JAXDAILYRECORD.COM
Jacksonville Daily Record/Jacksonville Record & Observer
Thursday, October 11, 2018 • Page 7
REAL ESTATE
Top 10 sales of the week BY SCOTT SAILER • EDITORIAL RESEARCH DIRECTOR
Here are the top 10 real estate sales in Northeast Florida, comprising Baker, Clay, Duval, Nassau and St. Johns counties. The sales were recorded Oct. 1-5.
Special to the Daily Record
Wells Lake Commerce Center in Orange Park sold for $6.795 million, a 3.74 percent increase over its 2005 sales price.
$6,795,000
$6,525,000
$6,439,500
$5,600,000
$5,000,000
320-350 Corporate Way, Orange Park, Clay County
14035 Beach Blvd., Jacksonville, Duval County
Cecil Connector Road, Jacksonville, Duval County
550 Outlet Mall Blvd., St. Augustine, St. Johns County
1771 Edgewood Ave. W., Jacksonville, Duval County
Type: Wells Lake Commerce Center Size: 7.16 acres Buyer: LPA Wells Lake LLC Seller: Wells Lake Partners LLC Previous sale: $6,550,000 in 2005
Type: Commercial retail Size: 1.63 acres Buyer: 14035 Beach RMR LLC Seller: John C. Cothran Revocable Trust
Type: Fox Creek Phase 3 and 4 Size: 66.2 acres Buyer: Forestar USA Real Estate Group Inc. Seller: Amaya of Volusia LLC
Type: Commercial Size: 7.55 acres Buyer: Bozard Ford Co. Seller: Merrill Lynch Mortgage Trust
Type: Edgewood Nursing Center Size: 6.69 acres Buyer: Lancaster Essex Properties LLC Seller: LTC Lake Forest Inc. Previous sale: $2,340,200 in 2002
$3,328,000
$3,156,000
$3,156,000
$3,156,000
$3,150,000
1821 Town Center Blvd., Fleming Island, Clay County
Park Forest Drive, Ponte Vedra, St. Johns County
Park Forest Drive, Ponte Vedra, St. Johns County
Park Forest Drive, Ponte Vedra, St. Johns County
3555 St. Johns Bluff Road S., Jacksonville, Duval County
Type: O2b Kids! Size: 1.23 acres Buyer: SCF RC Funding I LLC Seller: O2B Kids 7 LLC Previous sale: $713,000 in 2006
Type: 31 single-family lots at Twenty Mile at Nocatee Phase 5B Size: Not available Buyer: TMN Construction Holdings LLC Seller: Hydry Co. LLC
Type: 31 single-family lots at Twenty Mile at Nocatee Phase 5B Size: Not available Buyer: Weekley Homes LLC Seller: Hydry Co. LLC
Type: 31 single-family lots at Twenty Mile at Nocatee Phase 5B Size: Not available Buyer: Providence Construction Co. Seller: Hydry Co. LLC
Type: Sears Outlet Center and Parts & Repair Center Size: 4.11 acres Buyer: Town Center Storage Inc. Seller: SRC Facilities LLC Previous sale: $2,000,000 in 2017
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Page 8 • Thursday, October 11, 2018
Jacksonville Daily Record/Jacksonville Record & Observer
Arlington CONTINUED FROM PAGE 1
properties will be affected. Bill Cesery owns two strip malls along Merrill Road. He said he believes provisions tied to landscaping, signage and other standards will create unnecessary financial hardship for property owners. “We support this 100 percent, but we feel like they didn’t take any of our advice into consideration when they put this draft together,” said Cesery of the CRA advisory board. He said the latest draft, updated Sept. 12, addressed only a few of the two dozen recommendations he and other stakeholders offered the Renew Arlington Advisory Board. “The draft of the overlay was a shock to the business community,” he said. One of Cesery’s sticking points is the change to signage. According to the draft, properties less than 5 acres can’t have road signs taller than 6 feet. Pole-mounted signs, billboards, animated and other digital signage also would be prohibited. “There’s not a single sign in view that would meet that standard,” said Cesery of Merrill Road. While there is some property signage that could comply, most signs are taller than 6 feet and feature some of the elements banned in the new zoning overlay. Another proposed change concerns fencing and landscaping requirements. According to the proposed new standards, woven metal fencing – a material often used to contain or hide large dumpsters – would be banned and replaced with whatever building material matches the shopping center that is using the dumpsters. Those dumpsters also would need to be 25 feet from residential properties, which Cesery said isn’t possible because of the area’s tightly developed neighborhoods. Landscaping is another issue. Cesery said he’ll lose a row of parking at his Lake Lucina Shopping Center at 6132 Merrill Road because the standards require a 4-foot landscaping buffer on properties fronting the main corridors like Merrill Road and University Boulevard.
Photo by David Cawton
Revenue generated from the Renew Arlington Community Redevelopment Area could be used to bury power lines, like these along Merrill Road.
“Don’t get me wrong, I think we need some consistent landscaping, but that’s a lot of parking to lose and a lot of money to spend just to create room for what will be shrubs,” he said. Lake Lucina Shopping Center also would need a new 6-foot wall and additional landscape buffering at the back of the property because it abuts homes. Under the proposed overlay, property owners like Cesery would have five years to make those changes or face penalties or fines. “If they keep this document the way it is now, it’s going to cost me at least $120,000 and that’s without getting formal bids,” he said. While there are provisions that allow for administrative deviations or exceptions, Cesery said those should be used sparingly. “If the result is every property needs an exception to stay in business, then what’s the point?” he said. IMPACT ON BUSINESS OWNERS
Individual business owners also fear they will be affected. Mike Anania owns Cam Automotive along Arlington Road. As the head of the Arlington Business Society, he represents 56 business owners He echoed Cesery’s concerns over signage, landscaping and fencing requirements that would need to be addressed within five years. “For some folks within the
business community, it’s not quite as cost-prohibitive, but I know others who won’t survive if they have to make these changes because the landlords are going to pass that cost along in some way,” he said. Anania said he believes people will close their shops or sell their properties instead. “That will create an area with more blight, in my opinion,” he said. To comply with signage, landscaping and other requirements within the five-year deadline, Anania said he’ll need to spend at least $50,000. His automotive repair business also could be subject to more changes. The new overlay would ban shops from having open bay doors that provide access to work or storage areas from facing Merrill and Arlington roads and University Boulevard. Those changes are triggered when a business decides to undertake major renovations. He said he didn’t have an estimate for those alterations, other than “hundreds of thousands of dollars.” “There is not the economic climate in Arlington to afford that kind of outlay,” Anania said. “In business, you pass along your costs to your customers in either higher prices or higher rent.” Anania said he supports the CRA and the investments it could mean for roads and other infra-
RENEW ARLINGTON CRA The Jacksonville City Council created the Renew Arlington Community Redevelopment Area in 2015. CRAs are special funding districts created to spur economic development in blighted areas. Revenue generated from increased property values within the CRA would go toward economic development, housing, infrastructure and other projects that benefit the area. The dark green area is the CRA.
structure needs. He just wants to see some changes to the zoning overlay. “There are parts of this overlay that we love, that we need to have in order to get rid of the blight, but some of the punitive items in here need to go,” he said. IMPACT OF A CRA
Revenue generated from increased property values within the Renew Arlington CRA boundary will be dedicated to economic development, housing, infrastructure and other projects that benefit the area. According to the 2015 Renew Arlington CRA Redevelopment Plan, $59 million in additional funding could be generated to improve roadways, bury utilities and improve stormwater infrastructure. The idea is that those improvements will entice new businesses to open, and generate additional revenue for the area. The 19-member City Council comprises a board of directors with oversight over the CRAs, with the council president serving as chair. Two of Jacksonville’s five CRAs are under the purview of the Downtown Investment Authority. Results vary. This year, the Renew Arlington CRA will have a $755,000 budget. The KingSoutel Crossing CRA has a budget of $702,000. The most successful CRA in Duval County continues to be the Jacksonville International Airport CRA, which has a budget of $11.65 million this year. The area has benefited from companies like Amazon.com Inc. and Mercedes-Benz USA, which have opened or expanded facilities in the area.
WHAT’S NEXT?
The Renew Arlington CRA Advisory Board began working with the Planning and Development Department and other stakeholders soon after the CRA was established in 2015. The advisory board comprises seven members with ties to the Arlington area. Matt Tuohy is the chair. He also is the director of aeronautics for the Jacksonville University Davis College of Business. He said Wednesday that the advisory board does a lot of the leg work for the actual CRA board, especially when it comes to creating the zoning overlay. In September, the advisory board adopted a resolution recommending the CRA board pass it as is. He said he’s aware of some of the issues. “The public has had input the entire time and they’ve offered their recommendations and con-
cerns at those public meetings,” he said. “We’ve tried to incorporate those recommendations into this document.” Tuohy said the provisions outlined in the overlay are there to make Arlington more aesthetically pleasing. “We understand the financial concerns and that’s why we’re going to have a facade grant program to help,” Tuohy said. “I’m not sure what the final dollar figure will be, but it will be a 50 percent match up to a certain amount,” he said. He said that grant program should incentivize business and property owners to make the necessary changes. “Some of the bigger changes, like the open bays, aren’t triggered unless these businesses decide to undertake major renovations,” he said. “If they keep doing business as they have been, then they don’t need to make those changes.” He said the five-year requirement for signage, landscaping and fencing changed because the CRA sunsets in 20 years, which is a decade less than most CRAs in Florida. “We’re already four years in now, so by the time these changes need to be made permanent, we’re halfway through.” District 1 council member Joyce Morgan said she’s been close to the project since being elected to council in 2015. “As you know, every area in Jacksonville is unique, and Arlington is unique to itself,” she said. “I’ve tried to just be there for everyone, to hear their concerns and to offer solutions” she said. She said that change is hard for some, especially when that change comes with financial burden. “I don’t want our community to get so set in their ways that we can’t make any progress,” she said. “We’ve already come a mighty long way and we can’t stop now.” She said the Renew Arlington CRA board will take its time in finalizing the zoning overlay. “This isn’t a done deal,” she said. “We want our community to continue speaking up so we have something that’s right for Arlington.” Cesery said he and other Arlington stakeholders will continue to push for changes, “hopefully, before it gets approved. “We just want something that is inclusive and something that’s going to promote businesses in the area, not scare them away,” he said. DCAWTON@ JAXDAILYRECORD.COM @DAVIDCAWTON (904) 356-2466
Jacksonville Daily Record/Jacksonville Record & Observer
Thursday, October 11, 2018 • Page 9
JAX Chamber looking for ideas in Denver
Annual Leadership Trip sees 140 chamber officials and others looking for ideas to improve Downtown.
JAX Chamber visited Denver for its annual Leadership Trip as it looks for ideas to improve the city. The Chamber last visited Denver in 1999.
JAX Chamber members are spending a few days in Denver this week to learn more about the city’s efforts to improve its downtown. The chamber’s annual Leadership Trip involves 140 chamber members, staff, and officials who met with their counterparts in the Mile High City. According to the agenda, the focus was on finding new ideas to help improve Downtown Jacksonville. Topics centered on livability, transitoriented development, arts, education and workforce housing. Denver is the latest destination for the chamber. It visited Toronto in 2017 and Pittsburgh in 2016. The group previously toured Denver in 1999. According to incoming chamber Chair Debbie Buckland, Denver officials made downtown and surrounding neighborhoods more inviting and safer in the 19 years since the chamber’s last trip. The schedule featured presentations
by Colorado Gov. John Hickenlooper, Denver Mayor Michael Hancock and others. According to the agenda, Jacksonville Transportation Authority CEO Nathaniel Ford was sheduled to lead a panel on transit-oriented development. Trammell Crow Co. Managing Director Bill Moser, Denver’s Chief Projects Officer Diane Barrett and Denver Regional Transportation District General Manager David Genova were listed to participate on the panel. Shantel Davis, CSX Corp. vice president of real estate and facilities, was scheduled to moderate a discussion on workforce housing that included Vestcor Companies President Steve Moore and Ryan Tobin, the director of real estate development for the Denver Housing Authority. Mayor Lenny Curry did not attend because of concerns about Hurricane Michael. Chief of Staff Brian Hughes was scheduled to take Curry’s place and join
Special to the Daily Record
Denver Mayor Michael Hancock for the Mayor’s Dinner and a discussion on creating a livable downtown. Attendees also were scheduled to hear presentations about creating educational options in a downtown, with Duval County Schools Superintendent Diana Greene joining Nate Easley, CEO of Blue School Partners of Denver and Guild Education CEO Rachel Carlson. The national organization promotes adult education. Other topics included public art and helping small businesses thrive in an urban core. Jacksonville City Council members Lori Boyer and Greg Anderson attended. The trip was Tuesday-Thursday.
City Council passes resolution opposing Amendment No. 1
The Jacksonville City Council passed a resolution 17-0 Tuesday opposing a constitutional amendment that would
Friends of Hemming Park getting a new home A 1,846-square-foot office space in the Ed Ball Building will be the new home for the Friends of Hemming Park, the organization responsible for maintaining and creating programming for the Downtown park. The group, which operates as I3-JAX Inc., is relocating from space in the Jacksonville Main Library. The 12-month lease is for the former Victoria’s Cafe space on the ground floor of the Ed Ball Building at 214 N. Hogan St. The city will spend about $57,500 to prepare the space. No rent terms are outlined in legislation introduced to City Council on Oct. 9. DCAWTON@JAXDAILYRECORD.COM @DAVIDCAWTON (904) 356-2466
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create another $25,000 homestead exemption for Florida’s residential property owners. On Nov. 6, voters will decide on Amendment No. 1. If approved, it would exempt the assessed valuation of homestead property between $100,000 and $125,000 for all taxes except those Schellenberg levied by school districts. Council member Matt Schellenberg sponsored the legislation, 2018-694. Schellenberg represents District 6 in the Mandarin area. Schellenberg estimates the amendment would create a $25.7 million drop in the general fund revenue.
Page 10 • Thursday, October 11, 2018
Jacksonville Daily Record/Jacksonville Record & Observer
THE MARBUT REPORT
How appointment can be a path to bench
MAX MARBUT ASSOCIATE EDITOR
D.W. Perkins Bar Association panel discusses nomination process and efforts to diversify judiciary. In Florida, there are two ways to become a judge: mount a political campaign for the office and win the election or apply to the commission that evaluates candidates and then submits nominees to the governor, who selects an appointee. The process to be appointed to fill a judicial vacancy was the topic of a panel discussion when the D.W. Perkins Bar Association met last week at The River Club. The panel comprised attorneys A. Wellington Barlow, Dexter Van Davis and Charles McBurney. Barlow and Davis are former members of the 4th Circuit Judicial Nominating Commission. McBurney is a member of the Florida Federal Judicial Nominating Commission. The discussion was general in terms of procedure and specific in terms of efforts to ethnically diversify the judiciary. There are 27 judicial nominating commissions in Florida: one for each of the 20 judicial circuits, one for each of the five appellate districts and one each for the Supreme Court and the Statewide Nominating Commission for Judges of Compensation Claims. Davis said when he served on the commission for the 4th Circuit, he looked for candidates with balanced backgrounds comprising experi-
Photo by Max Marbut
From left, attorneys Dexter Van Davis, Charles McBurney and A. Wellington Barlow participated in a panel discussion about the judicial appointment process presented by the D.W. Perkins Bar Association.
ence on the prosecution and defense sides of the law. “We also looked for 10 years or more in practice and community service,” he said. McBurney said that on the federal level, most judicial applicants have “significant experience as a judge” in a county or state court. “We look for reputation, competency and temperament,” he said. Barlow was appointed to the 4th Circuit’s nominating commission in 1991 and was its first African-American chair. He recalled a study conducted by the state in 1991 during Gov. Lawton Chiles’s administration. The conclusion was that if Florida was going to have a more diverse bench, the effort had to start at the nominating commission level, said Barlow. “So Gov. Chiles appointed minorities and women to all the JNCs statewide,” he added. Although there currently are no vacancies, Davis encouraged association members to request the application for
judicial appointment. “We need more AfricanAmerican applicants,” he said.
LEGAL BRIEFS n Shawn Brooks and Henry Romeu joined the Jacksonville
Michael Freed honored by JU Gunster business litigation attorney Michael Freed will receive the 2018 Jacksonville University Distinguished Alumni Award of Excellence. He graduated summa cum laude from JU in 1990 with a bachelor’s in English and political science before attending Georgetown University Law Center. Freed is a former member of the alumni board of governors, helped orgaFreed nize the Dolphin Lawyers Network and is a past recipient of the Fran Kinne Award. He and his wife, Crystal, are supporters of JU through the establishment of the Crystal and Michael Freed Scholar-
office of Hall Booth Smith. Brooks focuses on professional negligence and medical malpractice, health care, general liability, products liability and transportation matters. Romeu focuses on medical malpractice, general liability, and transportation defense work. n Margaret McLendon, Melanie Lehmann and Carlean Maurer joined the Department of Children and Families/ Children’s Legal Services in Jacksonville. n Adam Saben of Shuster & Saben was recognized as a Gator 100 recipient, a designation for the 100 fastestgrowing businesses in the world owned or managed by University of Florida graduates.
SHARE YOUR LEGAL NEWS Attorneys and law firms are invited to send news and notes to Max Marbut, associate editor – legal affairs, at mmarbut@ jaxdailyrecord.com.
ship Fund, a component of JU’s $120 million Aspire capital campaign, according to a news release from the university. Freed will be honored during halftime of the homecoming and family weekend football
game Saturday at D.B. Milne Field on the JU campus. MMARBUT@ JAXDAILYRECORD.COM (904) 356-2466
Direct mail campaign targeted business owners, Realtors State Office of Attorney General files complaint against two companies and their owner. BY MAX MARBUT ASSOCIATE EDITOR
The state Office of the Attorney General has filed a complaint in Jacksonville against two companies and their owner alleging deceptive trade practices designed to target owners of new businesses and licensed real estate agents. Alfredo Zambrano, owner of Florida Regulation Enforcement Council and Florida Real Estate Council LLC, is accused of violating the Florida Deceptive and Unfair Trade Practices Act. In the case, assigned to 4th Judicial Circuit Judge Virginia Norton, the state seeks civil penalties, consumer restitution, attorney’s fees and injunctions against Zambrano and his com-
panies. According to the complaint, Zambrano, operating under the name Florida Regulation Enforcement Council and possibly others, has since 2014 used the names and contact information of newly formed Florida corporations and limited liability companies to send “officiallooking documents” through the U.S. mail to solicit payments for “certificates of status.” The solicitation allegedly gives new business owners the impression that the solicitation is from an official department or agency and that the Division of Corporations requires recipients to send a $65 fee to FREC for a “certificate of status” to complete the process of becoming a corporation or LLC. In fact, the state says, the Division of Corporations issues certificates of status for a payment of $8.75 for corporations and $5 for LLCs, but the certificates are “entirely optional decorative pieces of paper” that have no
bearing on a corporation or LLC’s official status. “Defendants provide no additional value which justifies increasing the price of certificates of status to 1300% of the actual price” charged by the state Division of Corporations, the complaint states. Zambrano also is alleged to have, acting as Florida Real Estate Council LLC, created and mailed deceptive solicitations for money to as many as 160,000 Florida licensed real estate agents from 2016 through 2017. The telephone number at the address listed on the summons for Zambrano is disconnected. The state contends that the mailings were designed to appear to be from an official government agency called the “Florida Board of Realtors,” but no such agency by that name exists. The mailings state that Florida real estate agents are required by state statute to self-report criminal convictions on their record to “the department.” The mailings
threaten action that could include fines or license revocation for failure to answer three “yes” or “no” questions on the form and return it to FBR with a $225 “fee.” The complaint states that licensed real estate agents are required by law to inform the state Department of Business and Professional Regulation if they are convicted of a felony, but there is no fee associated with reporting to DBPR. The Northeast Florida Association of Realtors became aware of the alleged scheme through inquiries from members who received the letters, said spokeswoman Melanie Green. The association investigated and then sent its members emails warning them about the deceptive letters on March 6, 2017, and again on June 27, 2017, advising “do not pay this invoice under any circumstances!” But some real estate professionals who received the solicitation may have responded with a payment.
“Realtors can be an easy target because they are used to paying fees,” Green said. Under state law, any entity or person that willfully engages in a deceptive or unfair act is liable for a civil penalty of $10,000 for each violation. The penalty may be up to $15,000 per violation involving senior citizens, veterans or members of their families or disabled people. The complaint also asserts the language of the letters violated the Misleading Solicitations Statute by failing to make it clear to the recipient that there was no obligation to make the payment. In addition, the complaint asks the court to grant restitution from the defendants to “fully reimburse every consumer who paid them money in response to their deceptive, misleading, unfair, unconscionable and unlawful solicitations.” MMARBUT@ JAXDAILYRECORD.COM (904) 356-2466
Jacksonville Daily Record/Jacksonville Record & Observer
Thursday, October 11, 2018 • Page 11
Florida Bar president encourages leadership ‘Women need to see other women lead,” says Michelle Suskauer. BY MAX MARBUT ASSOCIATE EDITOR
Making her first visit to a Jacksonville voluntary Bar association since being sworn into office, The Florida Bar President Michelle Suskauer addressed the meeting of the Jacksonville Women Lawyers Association on Wednesday at The River Club. A criminal defense attorney and partner with Dimond Kaplan & Rothstein in West Palm Beach, Suskauer is the 70th president of the organization and the sixth woman to serve as president. Speaking to about 150 attorneys, judges and guests, Suskauer outlined some of the initiatives on the agenda for her year leading the 106,000-member statewide organization. She said although the ratio of women to men graduating from law schools in the past several years is nearly equal, the statewide membership remains about 38 percent women and 62 percent men. About 25 percent are young lawyers – under the age of 35 or in practice for less than five years. Thirty-five percent are solo practitioners and 65 percent work in firms with five or fewer attorneys. She encouraged the audience to join the Bar’s many practice area sections. “It’s a way to be more involved, get CLEs, network and find out what’s on the cutting edge of your practice area,” Suskauer said. The Bar is convening its inaugural Criminal Justice Summit Oct. 16-17 in conjunction with the organization’s fall meeting in Tampa. It will combine the expertise of judges, elected state attorneys, public defenders and criminal defense attorneys. The intent is to build consensus on issues such as sentencing reform, specialty courts and juvenile justice. “We have a lot more in common than we do apart when it comes to criminal justice reform,” Suskauer said. Addressing gender inequality in the legal profession, she said far fewer women than men are equity partners in law firms. Women over 50 years of age represent only 20 percent of lawyers because they become frustrated with the lack of advancement and the gap in the compensation
Photos by Max Marbut
The Florida Bar President Michelle Suskauer addressed members and guests of the Jacksonville Women Lawyers Association on Wednesday at The River Club.
system that is controlled by male partners at most firms, Suskauer said. “Women are abandoning the law when they should be at the height of their careers,” she said. Ways to change that trend include women lawyers mentoring each other and looking out for their peers when it comes to the business side of practice. “It could be one conversation that changes your life, or it could be a lifetime relationship. And women need to send each other work and help each other,” said Suskauer. Assuming leadership roles on the local and state levels was another suggestion. Suskauer encouraged seeking election to Bar association boards. “Women need to see other women lead. It’s inspiring,” she said. The JWLA’s next meeting is scheduled for 11:40 a.m. Nov. 8 at The River Club. Nonmembers are welcome to attend. MMARBUT@ JAXDAILYRECORD.COM (904) 356-2466
Jacksonville Women Lawyers Association President Jamie Karpman, left, and Michelle Suskauer, president of The Florida Bar.
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IN THE LAW
Page 12 • Thursday, October 11, 2018
Jacksonville Daily Record/Jacksonville Record & Observer
SCOTT FORTUNE
SCOTT THOMAS FORTUNE Managing partner, Fortune Law Offices
BY MAX MARBUT • ASSOCIATE EDITOR
Scott Fortune is chair of the Jacksonville Bar Association Labor and Employment Law Committee.
Age: 62
Who or what inspired you to become a lawyer? My parents began telling me at a young age that I would be a good attorney. Sometimes they told me that I could be very persuasive. I wanted to be an attorney to help working people who were typically intimidated by attorneys.
Education: University of Florida, bachelor’s in journalism, 1978; University of Florida Levin College of Law, J.D., 1981
One person (other than your spouse or partner) who inspires me: My 81-year-old best friend Drew.
Hometown: Miami
How do you relate your undergraduate degree to your practice of law? I have a B.S. in journalism from the University of Florida. In addition to being taught the proper use of the English language, including grammar and form, we were taught about the importance of accuracy in reporting. I was a news editorial journalism student. If we incorrectly spelled a proper name, we failed our assignment, no matter what else we got right. How did you decide your practice area? And why have you chosen that? Employment law chose me. I had started a general practice, working in an office with friends from law school. They practiced criminal defense, family law, personal injury and some business law, and we all did a bit of each type of law. One day, a woman walked in with a very significant employment discrimination issue at work in 1985 or 1986. It turned into a big case in the field of employment discrimination law. Archie Thomas was the only other attorney in Jacksonville who was regularly practicing employment law at that time. He and I had somewhat of a lock on that field of law in Jacksonville, and in much of Florida, for at least a decade.
Family: Wife, Jennifer; son, Taylor Favorite book: “A Tale of Two Cities� by Charles Dickens
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What has been the biggest change in your practice area since you passed the Bar? I used to work six or seven days a week, from 7 a.m. until 9 p.m. I did that for about 20 years. Now I don’t typically work past 6 p.m. and I try to work only four days a week. But I still often end up coming in on Friday, at least for a few hours.
What community service have you pursued and why that? I spend some of my free time with folks who have been institutionalized, either in jails, prisons or in psychiatric hospitals. I have friends with family members who suffer from serious mental illnesses, for example, who have ended up in jail or in prison.
If I could change anything in the legal system, I would: Make it affordable. I could not afford my services. That is not hyperbole. It is very expensive to operate a law firm and we have to charge accordingly to stay in business. But it would be great if there were a viable way to make legal fees more affordable for the average person.
What’s your advice for new lawyers? Join the Jacksonville Bar Association. Go to meetings and reach out your hand. Introduce yourself and ask what you can do to be of help. Then follow through. And remember that you cannot change the world, but you can change your attitude. We can change the way we think and the way we feel, with our actions, but we cannot “think� our way into happiness or contentment.
Book I’m reading now: “Grant� by Ron Chernow Website I can’t live without: NYTimes.com Favorite nonwork activities: Reading, swimming, surfing, walking, jogging, watching TV and spending time with my wife and son.
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