Jarett S. Levan With BBX Capital

Intro: [00:00:01] Broadcasting live from the Business RadioX studios in South Florida. It’s time for South Florida Business Radio. Now, here’s your host.

Lee Kantor: [00:00:12] The Lee Kantor here another episode of South Florida Business Radio. And this is going to be a good one. But before we get started, it’s important to recognize our sponsor, Diaz Trade Law, your customs expert today on South Florida Business Radio, we have Jarrett Levan with BBX Capital. Welcome, Jarett.

Jarett Levan: [00:00:32] Hi, Lee. Thank you.

Lee Kantor: [00:00:33] I am so excited to learn what you’re up to. But for those who don’t know, tell us a little bit about BBX Capital. How you serving folks?

Jarett Levan: [00:00:42] So, BBX Capital is a diversified holding company. We have three major, what we call verticals or in the real estate business or in the candy business. And then we make door parts, barn door sliders, closet doors, and hardware. So it’s a very diversified and eclectic portfolio.

Lee Kantor: [00:01:01] Now can you just share a little bit about the history? Did you start out in one industry and then organically grew into the others, or like how did this kind of conglomerate come about?

Jarett Levan: [00:01:12] So our company has gone through many transitions over over five decades. We started in the real estate business in Miami in the mid eighties. We acquired a company called Bank Atlantic, which we operated for about 30 years, sold that in 2012, and at that point BBW became a diversified holding company, still stayed with our roots, which is real estate and real estate investing, and then have diversified into other platforms.

Lee Kantor: [00:01:40] So how did the Candy and Sweets business catch your eye?

Jarett Levan: [00:01:44] So actually, interestingly enough, Hoffmann’s Chocolates, which is headquartered in Green Acres and Palm Beach County, was a customer virus of Bank Atlantic. And as CEO of Bank Atlantic, I used to visit our customers regularly and just coincidentally, I would I would make Hoffman’s on my every time I went to Palm Beach County. I would put that on on the tour and we sold Bank Atlantic and decided to to develop a diversified platform. I’ve always been always had a sweet tooth. I was in the candy business in sixth grade and decided to reach out to the owners of Hoffman’s and see if they would sell to us. And they did. And that that was our first acquisition ten years ago this year, and it kind of catapulted us into this exciting industry.

Lee Kantor: [00:02:29] So when you were in in kind of banking, you had a glimpse of lots and lots of businesses. So that was the first thing that caught your eye was a chocolate company.

Jarett Levan: [00:02:40] Well, what I love well, first of all, I’m a chocoholic. So yes, I’m very passionate about my chocolate. But what I loved about Hoffmann’s on a much smaller scale was that they were rooted in the local community, which is no different than Bank Atlantic. We were rooted in the South Florida community. Hoffman’s was as well. Bank Atlantic had 100 locations. Hoffmann’s had three, but the concept was the same. And I tell people that the candy industry is very, very similar to the banking industry. You have very large companies like Mars and Hershey’s and Nestlé like you have very large banks and you have thousands of much smaller candy businesses around the country. And that’s what appealed to me about this industry.

Lee Kantor: [00:03:23] And then from there, that led to the other kind of confectionery acquisitions.

Jarett Levan: [00:03:30] Yes, we we had after Hoffmann’s, we made two more acquisitions in Florida, including the company that makes the legendary coconut patties that you see in the airports and the in the hotels and other shops around Florida and other tourist destinations. And then we acquired five years ago it’s Sugar, which is the largest of the specialty candy retailers in North America. And that business is really catapulted BBQ Sweet holdings.

Lee Kantor: [00:03:57] Now that that’s a franchise, right?

Jarett Levan: [00:04:00] No, it’s not a franchise. It’s not it Sugar owns and as a result owns 100, owns and operates 100 store locations and just we just opened our first one in Canada about six weeks ago.

Lee Kantor: [00:04:13] Wow. I didn’t realize that because I know I’ve seen them around the country and I just assumed it was a franchise. So those are all owner operated?

Jarett Levan: [00:04:20] Yes, they are.

Lee Kantor: [00:04:21] Wow. So what attracts you to that kind of an operation?

Jarett Levan: [00:04:27] Well, first of all, Candy, in North America is a $35 billion industry and growing. It’s not recession proof. Nothing is. But I’d like to say it’s recession resistant. We all like our candy. Many of us have a sweet tooth, but it’s sugar specifically has partnered with a lot of the large brands. And we we opened the first Sour Patch Kids Cafe. We just opened the first ever Oreo Cafe. We have relationships with all the large brands and, you know, our our footprint, you know, you can you can buy our you can buy the same candy maybe at Target or or at a I was going to say a five and dime, but those don’t exist anymore. But you can buy them at a grocery store or a drugstore. But we provide the entertainment aspect and we provide license apparel and accessories, and it’s just a different experience. Shopping at adventure, which makes it fun and exciting.

Lee Kantor: [00:05:26] Yeah, and it’s very social media friendly. I mean, that’s a it’s I mean, your marketing is kind of built into the to the store.

Jarett Levan: [00:05:34] It is. And we’re opening larger stores. We opened a 24,000 square foot store in New Jersey near the Meadowlands. We opened up 15,000 square foot store on Michigan Avenue. We’re opening a big store in Miami next year. We’ve got a big store in Times Square that just opened two months ago. So we have larger footprint, which allows us to to offer not only more candy, more nostalgic candy, more more fan favorites, but also, as I mentioned, we can also sell we have room to sell the licensed merchandise from from some of the big candy brands.

Lee Kantor: [00:06:12] Now, are you telling them to make kind of the large, super large packaged goods there or they had them? They always had them. And it was just difficult for the consumer to get.

Jarett Levan: [00:06:24] They always had them. We also have some exclusive items which we call the Giants, which are cereal sized boxes and larger. And we do some fun things with the brands. For instance, a lot of people like the Pink Starburst. You cannot buy pink Starburst in the store, but you can buy an exclusive pink starburst starburst collection, added sugar. You know, that’s just one example. But, you know, we work with the brands to create fun and exclusive content that you might not be able to buy elsewhere.

Lee Kantor: [00:06:54] Now, when you were kind of falling into this diversified investment strategy of yours, was it something that after a while you’re like, Hey, we maybe should have done this sooner? Like, was that something you were like, This was this was really working out well, because now, you know, we’re not as dependent on one aspect of the economy. If something gets hit, there’s always some kind of a hedge in there.

Jarett Levan: [00:07:18] So. So let me answer that in two ways. One, I don’t look back. I think there’s always a time and place. And the banking business was really good for 30 years. And what I enjoy about the diversified holding company is that we get to, you know, day is the same every day. I’m involved in different aspects of the different businesses. But the most important thing is that, you know, we have best practices across the companies, across industries. We have shared experiences, shared resources, we collaborate. And that’s the benefit that that a capital has as a diversified company, having different businesses, lots of different leaders throughout the organization, different geographies and different experience. And and that’s the beauty of of our diversified holding company.

Lee Kantor: [00:08:11] Now, how do you kind of create a culture that maybe permeates all of the brands that you serve?

Jarett Levan: [00:08:19] So we launched about three years ago an internal concept called one PBX, working together as the power of one. And we we have councils across the organizations. We have starting with the CEO council, we get I lead a council of myself and five other of our CEOs of a marketing council, a real estate council, a Finance council, a community Impact Council culture committee. So we encourage and tap people to join these councils to represent each of the companies that they become ambassadors for one, and they become ambassadors for the culture across and around the organization.

Lee Kantor: [00:09:05] Now that you’re in multiple markets, are you able to kind of live into that philosophy of supporting the community? I know how much you support the South Florida community, but does that kind of trickle into the other markets you serve with your brands in different parts of the country?

Jarett Levan: [00:09:22] It does. With our Community Impact Council, they meet once a month and we have people represented from South Florida, from Orlando and from from Toronto, and they talk about collaboration on initiatives like food drives or we did a a a build day a couple of months ago where we had in five different locations and five different cities across two countries where we had 101 associates building on the same day. And and then we created a video with photos and videos from each of the sites and put it on our in our one box newsletter. So, yes, we we we encourage the companies to do things locally, but we also try to do try to do community initiatives collectively. We also have a big partnership with Make-A-Wish nationally through a sugar and Witch, which is across all of our stores, and we’re in 28 states and two countries added sugar. And we’ve we’ve written a check as much as 700,000 to to to make a wish. So all these initiatives are important for and it’s it’s been a part of our DNA since since inception to give back to our local communities and local can be defined in many ways.

Lee Kantor: [00:10:52] Now, do you have any advice for other leaders that might be leading a diversified kind of portfolio that like you are? Is there any advice that you would give to them on how to kind of make sure that everybody is on the same page when it comes to communication? It sounds like that one is a great way for everybody to kind of get alignment and kind of get on the same page.

Jarett Levan: [00:11:19] So I, I joke internally that in addition to my title being the CEO, it’s also the CRO, the chief reminding officer and I spent a lot of time talking about talking to our executives across our companies and encouraging our companies to learn from each other. And that doesn’t just happen by chance. You have to create the platforms and the counsels and the communication for that to occur. And so I would encourage anybody that’s involved in or runs a diversified holding company to set up the platforms for their people to communicate. We have a newsletter I mentioned we sent out every month, and in addition to a memo from me, we highlight people and projects and initiatives and new stores and new apartment complexes and awards across the different companies. So I think the communication is just so critical in not only any company, but especially in a diversified platform.

Lee Kantor: [00:12:27] Especially when in one area somebody stumbles upon a great idea. It’s so important for that to be disseminated because you never know how somebody in the different industry might be able to leverage a similar principles.

Jarett Levan: [00:12:38] Actually, if we have time, I’ll share a story with you in the in the middle of the pandemic where freight costs from from China or had just gone went through the roof and one of our companies was struggling with the with the being incredible increase in the cost of bringing containers from China. I had heard of another one of our companies that was paying about 40% less. So I put the two of them together and it was significant savings that that was materialized just from that conversation.

Lee Kantor: [00:13:14] Right where it was. It might have been a throwaway line that you heard, but you were able to go, Hey, this connection is going to be valuable to somebody else. And and having that kind of open lines of communication to encourage sharing and then having somebody that can connect the dots, I mean, that’s where really a lot of impact happens.

Jarett Levan: [00:13:35] Exactly.

Lee Kantor: [00:13:37] So what do you need more of? How can we help?

Jarett Levan: [00:13:42] We what do we need more of? We need. We need we need good weather.

Lee Kantor: [00:13:51] We’ll work on that.

Jarett Levan: [00:13:53] We’ll work on that. What we need is we need which is happening. We need talented people, skilled workers in Florida, and we’re located on LA Solis. We need it’s actually easier than it used to be, used to be difficult to recruit people to South Florida. It’s gotten easier. Quality of life is just so great here. You know, having no state income tax really helps. But we just we continue to need more skilled, qualified labor in South Florida.

Lee Kantor: [00:14:25] And then what kind of backgrounds do you need? Do you need finance people? You need real estate experts. What kind of talent are you looking for?

Jarett Levan: [00:14:34] Finance and technology.

Lee Kantor: [00:14:37] Finance and technology. And then if somebody wants to learn more, what is the best way of doing that? What’s the best way to learn more about capital and maybe connect with you or somebody on your team?

Jarett Levan: [00:14:52] Well, they can. They can go to a capital com for sure. They can connect with me on LinkedIn and. You know, we’re we’re we’re always looking for ideas and opportunities. We’re we’re an acquisitive organization. So we do look for good opportunities, whether it’s in real estate or in operating companies. So if anybody has an idea or I love meeting with people to get new ideas. So if someone has an idea, I’d encourage them to reach out.

Lee Kantor: [00:15:25] And then so are you looking to acquire more candy companies, more real estate? Is that, you know, kind of the doors are open for that kind of conversation or are you open to any other businesses that might be doing interesting things?

Jarett Levan: [00:15:38] So I probably more focused on what we call bolt on acquisitions of our existing portfolio companies. However, if there’s an I, I’d be more focused right now on a company in Florida that might be available. But if there is an opportunity that someone thinks makes sense, we look for good brands. We don’t invest in startups, we don’t really invest in technology, we’re investing in mature brands in good sectors. We will, even if it’s not a bolt on, it’s a new sector. We would look at it.

Lee Kantor: [00:16:13] Good stuff. Well, Jared, thank you so much for sharing your story. You’re doing important work and we appreciate you.

Jarett Levan: [00:16:18] Thank you, Lee. I appreciate it.

Lee Kantor: [00:16:20] All right. This is Lee Kantor. We’ll see you all next time on South Florida Business Radio.