Tag Archives: starbucks

OldSchool07, WEB

Old School O7 sells for record low cap rate

Joe Compagno of CBRE has sold Old School O7, considered one of the most unique urban infill redevelopment projects in Phoenix. The 9,293-square-foot shopping center commanded a sale price of $6.1 million – or $656 per square foot – and a record low cap rate of 5.5 percent. The tenants include strong national tenants Starbucks, the Z’Tejas restaurant-concept Taco Guild and Buffalo Exchange.

CBRE’s Compagno represented the local seller, O7, LLC, a company formed by Phoenix-based Wetta Ventures, in the transaction. The buyer, Beverly Hills, Calif.-based Old School Property, LLC, was represented by Steven Stein with TauroREIS of Torrance, Calif.

“Successful urban infill retail projects like Old School O7 are highly sought after by investors. As economic drivers move demand back to city-centers, urbanization and adaptive reuse will continue to be significant forces in the commercial real estate market in Phoenix,” said Compagno. “Redevelopment efforts like Old School O7 exemplify this trend. We recognized a window in the marketplace to capitalize on aggressive pricing for this unique piece of real estate, consulted ownership and then proceeded to set the market with this sale.”

Old School O7, formerly a Methodist church and a school building built in the late 1800’s, was purchased by the seller in the spring of 2012 and was quickly redeveloped into one of the most captivating infill retail projects in metropolitan Phoenix. The former church is now home to the Taco Guild restaurant, while the school houses the Buffalo Exchange. The Starbucks is in a newly constructed free-standing 1,700-square-foot building located on the hard corner. Old School O7 is nestled in the heart of Central Phoenix along the coveted 7th Street major arterial at Osborn Road.

Compagno specializes in the sale of net leased retail investments in the United States and across the globe. His retail team works on the behalf of both private and institutional owners.

Wetta Ventures is a real estate development, investment and advisory company. Wetta Ventures specializes in discovering opportunities for adaptive reuse, renovation and infill development, while creating value in real estate investments.

photo

Leadership Forum: ‘Eyes of the world will be on Arizona’

The partnership between Starbucks and Arizona State University stirs up the way people can pay for college, have a family, and work at the same time.

Today, the 2014 Arizona Leadership Forum started off with the main message of, “We need you to lead us,” specifically speaking to attending business leaders, innovators and entrepreneurs. For quite some time, people have had the wrong impression of Arizona, but that’s about to change.

“Soon the eyes of the world will be on Arizona,” said Jathan Segur, executive vice president of National Bank of Arizona, referring to the 2015 Super Bowl, which will be played at University of Phoenix Stadium. “We will have the chance to talk about what’s right about Arizona.”

Segur’s speech set the tone of hope and optimism for the Leadership Forum.

Among those messages of hope, was one about the American dream to receive a high-quality college education. Unfortunately, it seems an unreachable dream for most. College tuition costs have risen 80 percent in the past 10 years. Therefore, only a select few can afford to go to college, and even fewer get to finish.

The Starbucks College Achievement Plan is the first of its kind, where a national company is taking the initiative to partner with an educational institution to give employees a second chance to live out their American dream. Due to the increasing college expenses, less than 50 percent of college students complete their degree.

“We employ a generation hit hard by our recession,” said Dervala Manley, vice president of global strategy at Starbucks Coffee Company.

Starbucks part-time and full-time employees from around the globe can now apply to receive funding towards their degree from Arizona State University. Freshman and sophomores attending ASU will be given a partial scholarship, accompanied with financial aid depending on their needs. Juniors and seniors will be given full tuition reimbursement with each year they continue to finish their studies. Students will have no obligation to stay at Starbucks after graduation.

Philip Regier, executive vice provost and dean of ASU online and extended campuses emphasized on how ASU wants to give everyone, no mater what their background, an equal chance to get a high-quality education. ASU has all 40 majors online as well as in person, making it more convenient for the working class.

“We did it [partnership] because we had a set of shared values,” Regier said.

This partnership between ASU and Starbucks is a leading example for an innovative state of mind in Arizona. Through the voices of the people, partnerships can form to benefit this generation. This partnership has created a way for aspiring college students to reach their highest potential in life.
“The face of Starbucks is not Howard Schultz, it’s the barista,” Hanley said.

Four peaks plaza

Sand Capital acquires Four Peaks Plaza

Sand Capital, a privately-held real estate investment company, located in Scottsdale, Ariz., has just closed on 140,390 square foot Target-anchored power center in Fountain Hills. Sand Capital is the financial arm and sister company to Sandor Development Company, which was founded in 1963 in Indianapolis, Indiana. Today, Sandor owns and manages over 8 million square feet of shopping centers in 25 states throughout the United States. Once acquired, Sand Capital assets are managed and leased by Sandor.

 

 

Four Peaks Plaza at 16735-16845 East Shea Boulevard is located in the northern Phoenix suburb of Fountain Hills. The center is comprised of 28 units and three outlots. Some of the major national tenants include Ross Dress for Less, Petco, Pier 1 Imports, Hi Health, Dollar Tree, Starbucks, Subway and O’Reilly Auto Parts. The leasing flyer is attached.

 

 

Earlier this month, Sand Capital acquired 29 CVS stores in 12 states and six shopping centers in three states.

starbucks

ASU clears degree path for Starbucks baristas

Arizona State University is helping Starbucks give its baristas a bargain on an online college degree.

The company is partnering with ASU to make an undergraduate education available at a steep discount to 135,000 U.S. employees who work at least 20 hours a week. Workers will be able to choose from 40 educational programs, and they won’t be required to stay at Starbucks after earning the degree.

For freshman and sophomore years, students would pay a greatly reduced tuition after factoring in a scholarship from Starbucks, ASU and financial aid, such as Pell grants. For the junior and senior years, Starbucks would reimburse any money that workers pay out of pocket.

That means employees who already have two years of college under their belts would be able to finish school at no cost.

CEO Howard Schultz plans to make the announcement Monday at the Times Center in New York City, where Education Secretary Arne Duncan will be in attendance, along with 340 Starbucks employees and their families.

Tuition reimbursement is a rare benefit for low-wage workers in the retail industry. In 2010, Wal-Mart Stores Inc. started offering partial tuition grants for workers at American Public University, a for-profit, online school.

Starbucks already has program that reimburses workers for up to $1,000 a year at City University of Seattle or at Strayer University. Starbucks says that will be phased out by 2015 in favor of the new program, which is far more generous.

The Seattle company doesn’t know how many of its workers will apply, and it isn’t saying how much the program might cost it. Tuition for an online degree at ASU is about $10,000 a year, although it can vary depending on the program. Many Starbucks workers would likely qualify for a Pell grant, which can be worth as much as $5,730.

Michael Bojorquez Echeverria, a 23-year-old Starbucks worker from Los Angeles, was flown to New York City by the company for the event Monday. He said that he works 60 to 75 hours a week, including a second job, and also attends community college.

He hopes the program will allow him to reduce those hours and focus on school, where he does not pay tuition because of wavers. But he is applying for the Arizona State University program because he feels there will be greater certainty about financial assistance.

He says he will miss the socialization that occurs on campus.

“But hey, if they’re going to be paying my fees, I can manage,” he said.

Cliff Burrows, head of the Americas for Starbucks, said he hopes the program will encourage other companies to offer similar benefits. He added that Starbucks plans to look at expanding the educational perks to workers overseas.

The financial terms of Starbucks’ agreement with Arizona State are not being disclosed.

Starbucks workers would have to meet the same admission standards as other students at ASU. Only workers at Starbucks’ 8,200 company-operated stores would be eligible. Another 4,500 Starbucks locations are operated by franchisees.

The program is also available to Starbucks’ other chains, including Teavana tea shops and Seattle’s Best.

hmshost transforms phoenix sky harbor dining experience

HMSHost Brings New Dining Experience To Sky Harbor

HMSHost, the world leader in creating dining and shopping for travel venues, is transforming the Phoenix traveler’s experience at Phoenix Sky Harbor International Airport’s Terminal 4, bringing more than 20 new restaurants including local favorites like Sauce, Barrio Cafe, La Grande Orange and Cowboy Ciao, along with national brands like Starbucks.

The update is a result of last year’s decision by the city of Phoenix to award HMSHost a 10-year food and beverage agreement, following a 2011 competitive bid process.  

The first restaurants, Sauce, Dilly’s Deli and Focaccia Fiorentine, opened recently and feature grab-and-go items, perfect for travelers to take on the plane. Staples such as El Bravo, Paradise Bakery and Cafe and Starbucks will remain in Terminal 4, but will be moving to new locations. 

“This is a busy and exciting time of year for vacations and summer travel and we are very happy to be able to begin providing a new experience at Sky Harbor Airport that will truly showcase an authentic taste of Phoenix,” said Steve Douglas, vice president of business development for HMSHost.  “Terminal 4 is the busiest spot in one of America’s busiest airports and we’re bringing out the best of the best to showcase the great dining in the city of Phoenix.” 

Phoenix Mayor Greg Stanton said the update to Terminal 4, when complete, will reflect the flavor of America’s sixth largest city. 

“When travelers come to visit Phoenix or pass through our airport, I want them to know what Phoenix is all about, and soon they’ll be able to taste it,” Mayor Greg Stanton said. “They’ll know that our city and our airport support our local businesses, and that Phoenix is an epicenter of high-quality, modern and authentic dining.” 

Local Phoenix restaurateurs Sam Fox of Fox Restaurant Group and Bob Lynn of LGO Hospitality have partnered with HMSHost to bring an unprecedented level of culinary expertise to Terminal 4 throughout its North and South wings. Travelers passing through the A gates will find the full range of Sam Fox’s food imagination: Modern Burger’s juicy burger sliders, and Blanco Tacos + Tequila’s delicious, award-winning traditional Mexican fare of guacamole, tacos and margaritas inspired by Baja and Sonora. 

The transformation, which features a new off-site commissary and technological improvements that will speed and ease service for travelers, has already begun. 

“This transformation was carefully planned and balances the practical needs of travelers with a range of options, pre-security and post-security, for on-the-go or for those with more time to spare,” said Derek Boettcher, senior director of food & beverage for HMSHost at Sky Harbor Airport. 

Visitors to the D Concourse will enjoy Bob Lynn’s popular LGO restaurant brands.  The La Grande Orange experience will offer four distinct and delicious options — LGO Burger, LGO Deli and the LGO Pizza with Grateful Spoon Gelato.

The dining experience at Phoenix Sky Harbor extends further with these enticing offerings:

  • Fans of the New York Pizza Department (NYPD) will tell you it’s the best authentic New York-style pizza in Arizona.
  • Press Coffee offers more than outstanding coffee with fresh roasted beans.  Press offers salads, daily soups, and Panini sandwiches to satisfy any appetite.
  • One of Phoenix’s must-try restaurants, Cowboy Ciao is coming to the high B gates in Sky Harbor’s international concourse. What started as a very unique Southwest-meets-Italian premise has evolved into a style best described as eclectic American.
  • The French countryside makes a trip to this Concourse in the form of la Madeleine, luring travelers with healthy offerings including salads, vegetarian fare, and delicious sweet treats.
  • Barrio Café is the creation of chef and owner Silvana Salcido-Esparza who makes her Mexico-inspired dishes a must-taste for everyone. Barrio Café will be located in the D concourse. Chef Esparza is a 2010 and 2011 James Beard Foundation nominee for Best Chef-Southwest. 
  • Also in B and C gates, HMSHost’s busy baristas at Starbucks will fuel weary travelers with great beverages and snacks — no matter what time zone they are entering or have just departed. 
  • Travelers to the C gates will find the much-beloved Paradise Bakery (now open), along with a Tucson tradition come-to-life in Sir Veza’s Taco Garage — offering something for everyone from hand-bored guacamole and imaginatively sauced wings, to Nitro Nachos and Tricked Out Tacos, as well as the local legend in coffee, Cartel Coffee Lab. 
  • The pre-security Terminal 4 lobby will showcase Bob Lynn’s Chelsea’s Kitchen, specializing in gourmet burgers, upscale taco platters, rotisserie meats and American comfort food.  It will be joined by Sam Fox’s Sauce (now open) where guests will get a full complement of pizza, salad and pasta.  Also pre-security, Starbucks fans will greet their favorite java in the lobby as they wait happily for family members. 

The tentative schedule of openings for the summer and fall: 

June
Blanco Tacos & Tequila
Modern Burger
Barrio Cafe
La Madeline 

July
Press Coffee
El Bravo
September
Sir Veza’s
Cartel Coffee Lab
Chelsea’s Kitchen
Starbucks
La Grande Orange

October
NYPD Pizza 
Cowboy Ciao

For more information on HMSHost, visit hmshost.com

consumer behavior

Consumer Behavior Sparks Ideas For New Products, Expanding Markets

Marketing turns something old into something new: Consumer behavior sparks ideas for new products, expanding markets.


Introducing a new product to market can take years of research and expense. Or it can be as simple as taking something already in existence and marketing it for a different purpose. Creating or discovering a whole new use or new market for a product can be all you need to generate increased sales and growth. Observing consumer behavior is often the catalyst for new ideas.

A recent article in The Wall Street Journal outlines Hidden Valley Foods’ plan to expand its market penetration for its premier product, Hidden Valley Ranch Dressing. By repositioning the ever-popular salad dressing as the “new ketchup,” the company believes it can expand its market share and increase revenue. Updating the recipe to make the dressing thicker and creamier in order to stay atop a burger and creating new packaging and labeling, the new version will be called Hidden Valley for Everything. The company will introduce the product to the restaurant industry and grocery sales as soon as they finalize the recipe, so it can safely remain on the table as a nonperishable item, like ketchup and mustard.

The idea for repositioning the top selling salad dressing came about when a company executive observed his daughter pouring it over her salmon dinner. While ranch dressing is said to be “the most often used salad dressing in the U.S.,” the executive saw his daughter’s behavior as an opportunity to expand to a new area. Research shows that 15 percent of ranch dressing consumers use it on something other than salad, which supports the company’s move to make a play for market share in the condiment category.

Similarly, when Google learned that its customers were enjoying Google Translate more for its musical attributes than to translate words and phrases, the company saw a demand for this service with a new purpose. Customers type in a string of consonants as English for the system to translate into German, and then the computer “speaks” the phrase in rhythmic beat. The result is music to the user’s ears.

Then there is Starbucks’ CEO, Howard Schultz, who was recently credited with reviving the business by introducing a variety of new products and services. One of those ideas is a light roast coffee — a first for the coffeehouse chain that built its business on rich, dark roast flavors. When the company’s market research uncovered that “40 percent of U.S. coffee drinkers prefer a lighter, milder roast,” the product development team went to work creating their new Blonde roast.

Business owners and managers at small companies can learn from these industry leaders. Watching and listening to your consumers can often uncover the potential for new sources of revenue. Conduct a review of current products and services and think about how you might promote them to a different target market or how they may be utilized differently. By repositioning or refocusing your marketing, the potential for growth can be accomplished by just looking at the situation from a new perspective.

For more information on observing consumer behavior, or marketingworx and its services, visit www.marketingworxpr.com.

Funding Startup Companies Jumpstart Economy

Funding Startup Companies Can Help Get the Economy Moving Again

Wanted: More Jobs

I don’t have a fancy degree from an Ivy League school, and I’m not formally trained in economics. So you won’t see me on the President’s economic advisory team, or lecturing on the philosophical differences between the Keynesian and Austrian economic theories.

Instead, I grew up watching my father start a manufacturing firm and build it into a successful, multimillion-dollar business. I followed in those footsteps by helping two technology startups grow from infancy to a spot on the Inc. 500 list and eventually sell for more than $100 million.

What I’ve learned through these experiences is that innovative startups are the engine of the American economy. Startups breathe life into slow growth industries (think Starbucks, Crocs and Netflix). Startups create new products and new markets (think salesforce.com, Google and Twitter). And startups solve complex scientific and engineering challenges to create life-changing products (think Intel, Amgen and TiVo).

Naturally, as innovative startups grow they create jobs — and lots of them. An eye-opening study by the Kauffman Foundation brings that into sharp focus. The study showed that startups are responsible for all net job growth in the U.S. since 1977.

Think about that for a minute. In aggregate, older more established firms do not create jobs (at least not in the U.S.). Job growth at one company is matched or exceeded by a decline at another. In essence individual companies are trading market share, but the market itself is growing slowly or not at all. When you add in technological advances to improve employee productivity, outsourcing to offshore locations, or simply eliminating positions to meet a lower level of demand, it is not surprising that established firms do not drive job growth.

Not all startups are equal

Any entrepreneur with the guts to launch a new startup deserves enormous respect, but not all startups are created equal when it comes to job creation. Startups in slow-growth markets such as restaurants, retail and other consumer services suffer from the same challenges as more established firms. Namely, a new growth company takes market share from an established player, so any new jobs created are eventually met with job cuts at other companies.

Similarly, startups in cyclical industries such as transportation, hotels, construction, real estate, etc., will not create sustained job growth. In good economic times, these companies will boom — and just as quickly go bust when the economic winds change.

While there are exceptions to these broad generalizations (note Starbucks and Crocs), sustainable job growth usually comes from scalable, innovative startups. These are the startups that venture capitalists and angel investors target. And these are the startups that will create new markets and lead the U.S. out of this economic slowdown.

Angel and venture capital investing

The startups noted earlier all share one common trait: they were funded by angel and/or venture capital. It is safe to say that without that capital, these companies would not have reached their respective heights.

Venture capital (VC) as a distinct asset class has existed since the ’60s, reaching its high point during the dot-com boom of the late ’90s and early 20000s. With such a long history, venture capital remains a relatively small segment of the capital markets. According to a report by HIS Global Insight, in 2009, new venture investments totaled $18 billion. Since 1970, only $474 billion has been invested in 27,000-plus companies. By comparison:

    The U.S. Treasury Department will issue more than $1.1 trillion in debt this year to cover the budget deficit.

    The junk bond market is greater than $600 billion in size.

    The wars in Iraq and Afghanistan cost more than $170 billion in 2010 alone.

But venture-backed companies have an outsized impact on GDP and employment. VC-backed companies produced more than $2.9 trillion in revenue in 2009, representing more than 21 percent of total U.S. gross domestic product. More importantly, 12.1 million people are employed at venture-backed companies, representing more than 11 percent of total private sector employment.

These numbers clearly show that innovative startups create economic growth and sustainable employment.

An alternative plan

That’s why I get viscerally angry watching the economic ignorance of our federal and state governments. Politicians pay lip service to wanting to create jobs, then spend tax dollars on big corporate giveaways, old industry subsidies, and pet projects that have little impact on actual job growth.

And when our government finally recognizes the need to create jobs and support small businesses, they create programs that will do neither.

A simple (and most likely profitable) plan that will have a fast and tangible impact on jobs is to create a federal “matching fund” for any angel group or venture capital firm to access. The matching fund would automatically invest a matching amount in any innovative startup that receives investment from the VC/angel group. Funds should be made available only for seed and early-stage investments. Extra incentives should be given to promote investment in regions of the country with low levels of VC investment and/or high levels of unemployment.

Under this plan, capital will be invested in companies with the highest potential for job and economic growth, and the fund will most likely turn a profit when all is said and done.

But don’t hold your breath waiting for innovative economic solutions to materialize in Washington. Instead, allocate some of your portfolio to angel/venture investing, then find a local angel group and get involved. You will be rewarded by working with some of the best and brightest entrepreneurs, while helping get the American economy growing again. And with any luck, you will make some money along the way.