When you look for a good role model among business leaders who give back, Jarett Levan sets one of the highest bars. The CEO of BBX Capital, Inc. (OTCQX: BBXIA) (PINK: BBXIB) has long been a supporter of the arts and has broadened the scope to include affordable housing, social justice, mental health and feeding the hungry. The business is a diversified holding company that’s noteworthy for real estate projects and candy. IT’SUGAR is North America’s largest specialty candy retailer and overcame huge challenges during the COVID pandemic.
Levan was interviewed by Lifestyle Media Group Editor-in-Chief Kevin Gale. The following transcript has been edited for brevity and clarity.
So, your father Alan Levan continues to serve as Chairman of BBX Capital. I was curious about what those dynamics are like.
I am very fortunate because, from the time I came into the business in 1998, when I came out of law school, to today, Alan has always treated me as a partner. He never really treated me in the business as his son and he respected me and trusted me like any other executive that he worked alongside. You don’t see that very often, especially when someone comes in as a 25-year-old. It’s mutual trust, mutual respect, and I think it works because of candid communication, which goes both ways.
Talk to me about Jack Abdo, who has been your father’s business partner for 39 years.
Alan, Jack, Seth Wise and I operate as partners in every aspect of the business. Jack is a great partner. He’s a great friend to us. Jack and his family are really our family. Jack is brilliant. He’s a great negotiator and he has tremendous relationships in the community.
When I look back at BBX, I think back to 2012 when BankAtlantic was sold to BB&T, but you guys kept a lot of the nonperforming assets, which I predicted would work out pretty well. Was I right?
You were right and we were right. BB&T did not want those nonperforming assets. They didn’t understand the real estate collateral like we did. They thought they were going to have to continue to write them down. The assets were better in a holding company that was not related to a federally chartered bank. We knew the borrowers. We knew the collateral and we turned that entire portfolio over to Seth and it became the impetus, the growth capital for what BBX is today because we monetized those assets, either through foreclosure or through development. It became a tremendous pot of gold for what BBX is today.
Talk about some of the real estate projects BBX has done and how it breaks down between The Altman Companies, BBX Logistics and any other arms of BBX.
The BBX real estate vertical is today made up of three primary verticals. At one point it was four, including Bluegreen Vacations, but we spun that out 3 1/2 years ago and subsequently sold it to Hilton Grand Vacations. The remaining three verticals are BBX Capital Real Estate, with Seth as president, BBX Sweet Holdings, of which I’m CEO, and then a company called Renin, which is headquartered in Canada and manufactures innovative interior sliding doors and hardware systems. The BBX real estate vertical has three primary divisions. One is investing with others, and we’ve invested over the years with Stiles, and CC Homes, led by Jim Carr and Armando Codina. We’ve invested with Harry Posen [a former Minto Communities executive] and others. We’ve got The Altman Companies, a multifamily developer that we acquired from Joel Altman over five years ago. And then we have BBX Logistics Properties that we started about three years ago.
The Altman Companies is headquartered in Fort Lauderdale and most of our projects are merchant developer (build to sell) and we bring in third party investors alongside us.
On the logistics side, we’re really starting to gain momentum. We did a groundbreaking last month for The Park at Delray located on U.S. 441. That is a very exciting logistics facility with rights to build up to 672,533 square feet of logistics space. The initial phase of the project is expected to be construction of an approximately 200,000 sq. ft. building, with plans to construct two additional buildings in the future.
We are pursuing two different properties in New Jersey, which are infill for the New York market. We’ve got a project in Lakeland. We are working on a project in western Broward County. One of our newest projects is the redevelopment of Signature Grand. This is a joint venture with FRP Development Corp with the intention to redevelop the 11.3-acre site into The Park at Davie, consisting of two buildings and approximately 182,000-square-feet of logistics space.
One of our trophy development projects is Beacon Lake in St. Johns County. That was a BankAtlantic legacy asset. It’s a master planned community comprising approximately 632 acres, with 1,280 single-family homes, 196 townhomes and an 8,200-sq. ft. club house and fitness center. We’re almost complete, and it’s turned out to be a beautiful community.
I give Seth and his team a lot of credit for maximizing the value of those former BankAtlantic assets that we retained after the sale, really turning lemons into lemonade. Seth has assembled a quality team on the real estate side from the developers to the construction team.
Any projects in the pipeline?
We have many different Altman projects in some phase of development or lease-up. And we have new projects in the pipeline, including one in North Miami. On the logistics side, we’re merchant developers as well. We’ll build a project and then after lease-up, we will put it up for sale, but right now we’re too early in the process. We have probably half a dozen logistics projects in some stage of development or due diligence. I’m going to say that it’s about a million and a half square feet, between Florida and New Jersey of projects that will be coming out of the ground soon.
I saw a report that on Jan. 31st you bought 415,395 BBX shares for $4.5 million.
I bought those shares over current market, which is still trading at a tremendous discount to BBX’s book value. As CEO, I believe in the company, and I believe in the opportunities ahead of us.
I did a story some time ago about IT’SUGAR. It looked like a great concept and then COVID hit.
I became CEO of IT’SUGAR officially in January when founder Jeff Rubin transitioned to chairman and advisor. Since our American Dream store in New Jersey opened, a 22,000 Flagship location, spanning three stories, we’ve opened four other Flagship stores. We have a store in Times Square, which is over 20,000 square feet. We have a store in Honolulu, which is about 18,000 feet. We have a store in Fishman’s Wharf, which is 30,000 square feet. We just opened a store in Bayside in Miami, which is approximately 16,000 feet. So, we have 115 stores throughout 28 states and two countries, including one in western Canada. We’re the largest specialty candy retailer in North America. IT’SUGAR is a great business that is a lot of fun and satisfies our customers’ sweet tooth.
We opened the America Dream store three months before Covid, and that was a very trying time, not just for IT’SUGAR, but for the entire retail industry. We did elect to declare bankruptcy in September 2020 and emerged in June 2021. That was a very difficult time because the business was going great before COVID, but then came to a screeching halt.
We had at that point a hundred leases with monthly rents, but the stores were closed, and the stores were full of inventory for Easter and spring break. That product was either donated or had to be trashed. So, we had lots of bills to pay and lots of rent checks that were due, probably four or five months’ worth, and we elected to declare bankruptcy. We came out of bankruptcy with more stores than when we came in. Through bankruptcy and through COVID we opened another 10-15 stores. The company has great relationships with its landlords and with its vendors, and we told them, which they believed and came to fruition, that we were going to come out stronger and prepared for growth. Last year, we opened 25 stores. So, it’s been a very exciting time at the company despite the madness of navigating through COVID.
Talk about Las Olas Confections and Snacks and Hoffman’s Chocolates.
Hoffman’s Chocolates has six locations. It was operating as a separate company, but about a year ago we folded it into IT’SUGAR. It still has six locations in South Florida, two in Broward and four in Palm Beach. Las Olas Confections and Snacks has an 80,000 square foot factory in Orlando where we make the legendary Anastasia Coconut Patties. We make taffy, bark and brittle. We manufacture for Hoffman’s Chocolates. It’s probably the largest candy factory in Florida, so we’re pretty proud of that. It’s loads of fun to be in a candy factory.
Talk about being a retailer who has to lease space these days. I’ve heard some horror stories about rent increases.
We haven’t had that experience. We have great relationships with the large landlords and mall owners. In many cases, we’ll have a dozen or half a dozen sites with them. We have leases that have come due, but we agree on new rent deals, and we find suitable lease terms for both parties. If we don’t, we’ll just pack up and walk away. In some cases, we can reuse the fixtures in another store.
We have been fortunate to test the retail landscape in certain markets where we can open up a location for a short term – two, three years, test the market, figure out what our sales are going to be – and then be able to lock in for a long-term lease. Right now, we have that on Chicago’s Michigan Avenue on the Magnificent Mile. It’s a great location and performs really well. We’ve been open two years, and we now know what the sales volume can be and we can lock in a longer-term lease. There aren’t many retailers that can operate out of 1,200 square feet and 30,000 square feet.
You’re on a number of charitable boards. Talk about your activities.
Going back 25 years, my first board was ArtServe. I was always interested in the arts even at a young age. So, when I came to the bank and we had the BBX Capital Foundation (formerly the BankAtlantic Foundation) and I wanted to join a nonprofit, I joined ArtServe right on Sunrise Boulevard. It was two blocks from our corporate office, and I loved it. It’s been a 25-year love affair with the arts in Broward County and my involvement and the company’s commitment. I chair the Business for the Arts of Broward board and was a founding board member 12 years ago, and it’s my second time as chair. I sit on the board of the Broward Performing Arts Foundation and was formerly on the Community Foundation of Broward board.
I believe that as a business leader in this community, we owe it to the community to serve, not just to give. The arts are a passion, and both Dara [his wife] and I as well as BBX Capital have supported the arts over the years. We have the BBX Capital Fund for the Arts and then have the Dara and Jarett Levan Endowed Fund for the Arts, both at the Community Foundation of Broward. The mission is to support art, artists and art and cultural organizations in Broward County forever. And that’s the beauty of the endowed fund. It’ll live on forever.
Right now, most of our focus has been to help support public art in Broward County. There are three or four projects that I can name. One of them is the Love Mural on Las Olas, which was unveiled in February. There’s a new mural that’s going to be coming to the city for the parking garage right behind Broward College. There’s a new mural at Broward Health on 17th Street and Andrews Avenue, which will be a very large mural on that corner. We’re very excited about a lot of the murals coming to Broward County that really showcase many of our talented local artists.
If you’re going to talk to a businessperson about why it’s important for the business community to support the arts, what would you say?
One, that it’s our community and if we’re not going to support the arts or not going to support nonprofits in our community, then who do we expect is going to do that? It’s our obligation and it’s a nice reward that we can give back to the community. It’s important to our associates that we give back, and our involvement in local philanthropy, not only that the company is supportive, but how involved the CEO and the leadership team are. I think it’s an important message and it just becomes part of our culture.
Affordable housing is a hot button issue. Give your perspective as a business leader and talk about Habitat for Humanity of Broward.
Affordable housing is a Pandora’s box because it is such a tremendous need in our community — not just for employees of BBX, it’s for teachers and nurses and firemen and women. If we don’t solve this problem, we’re going to lose good people to other communities. I know there are a lot of people and groups that are talking about it, including the Broward Workshop, of which I’m also a member. We must solve it. We don’t have a choice.
Habitat for Humanity is an organization that BankAtlantic, now BBX, has been involved in for 40 years. We have turned over the keys to 60 homeowners over that period. In the last 18 months, BBX, Hoffman’s Chocolates and IT’SUGAR have funded three new homes and we’ve done build days with our associates, which is a lot of fun. It’s very rewarding to be standing next to one of my colleagues, one of our associates and we’re painting together or caulking together.
BBX announced a $100,000 initiative in 2021 to help address social justice. There seems to be somewhat of a backlash against companies who address systemic racism and social injustice. Have you gotten any blowback?
Proudly, I want to tell you that we did that in 2021, and then in 2023 we contributed $100,000 for a mental health grant program. And then in 2024, we did another $75,000 for mental health. We did an event last week where we handed out the checks to eight local organizations. We’re really proud of those programs for social justice, for mental health and for affordable housing. These are systemic issues in our community.
We decided a couple years ago that in addition to supporting arts and education, we have to support and try to help solve our community’s systemic issues. Another one is food insecurity. We’re a big supporter of Feeding South Florida and we tie in the food insecurity with arts. We did a collaboration with Feeding South Florida and an 11th grade student’s artwork was selected and will be on the side of an 18-wheeler for a year in South Florida. So, coming back to social justice and racism, we’ve not had any blow back.
Do you have any children? Are any of them interested in joining you in business?
I have two kids. They’re 22 and 19. One just graduated college and one’s a sophomore in college. Both my kids are welcome to join the business, but they are also encouraged to pursue their own dreams.
Where do you see yourself in say five years, 10 years?
I see myself in the same place. I see myself as CEO at BBX Capital, a diversified holding company. I see us continuing to expand our real estate portfolio and I see IT’SUGAR continuing to grow. In 10 years, my wife and I will be married for 35 years. Wow. Maybe in 10 years I’ll be a grandfather. Who knows? But obviously I come from good stock. Alan is in his late 70s and still working hard and I expect to be doing the same.
