This team brought Chipotle, Zupas, more to Boise
LeAnn Hume and Andrea Nilson met 20 years ago, as employees of Albertsons. About four years ago, they joined up with fellow commercial real estate broker Sara Shropshire to create a team at Cushman & Wakefield Pacific that specializes in retail tenant representation and retail investment sales. It’s the only team of its kind in the Treasure Valley, as far as they know.
Their Downtown Boise office is an affiliate of the global real estate brokerage company. The office at Ninth and Broad streets has six full-time employees, two property managers and 16 brokers who are independent contractors. Hume declined to disclose annual sales.
“We feel like our market is big enough now where, if you don’t specialize, you’re not really doing your client a service, because you really do need to be an expert at what you’re doing,” Hume says. “You can’t be an expert if you’re doing industrial and office and retail and land — and, and, and. People do that. It works, but we really felt like it was important for our clients for us to not.”
For some clients, like Cafe Zupas, they build a multiyear rollout plan for locations across the region or across the state.
“We put a lot of windshield time in,” Nilson says. “I was in Spokane and Rathdrum and all these other small Northern Idaho towns the week before I went on an Eastern Idaho tour. We are probably one of the only teams that leaves the market, leaves Boise. We do deals all over Idaho.”
For many of their deals, the brokers wear several hats — scouting locations and working with developers, buyers, investors, franchisees and anyone else with a stake in retail real estate.
“Pizza Hut is shrinking their model,” Shropshire says. “They used to be the big sit-down restaurant, and they’re getting away from that and going to delivery and takeout only, like some of their competitors, Little Caesars and Domino’s. So they came to us and said, ‘We need to move into all these smaller spaces, and we need to do basically a mass exodus of all our big locations, except for a couple that do really well.’ ”
Hume says the team pitched both the Pizza Hut franchisee — NPC International — and the landowner of the properties about a year ago: “Let us do all of this.”
Since then, they’ve found new locations for six of the eight downsizing Pizza Huts. Next, they will start the second wave of Pizza Hut downsizing.
The old Pizza Hut at Apple and ParkCenter that closed, and the new smaller one that opened on Federal Way? They were part of the Hume-Nilson-Shropshire project.
“I’m really proud of that project,” Hume says.
What’s hot right now?
Kuna, for one thing: “Tons of homes and no services,” Nilson says.
She mentions four new retailers opening Kuna locations: Dollar Tree, Tractor Supply, O’Reilly Auto Parts and Taco Bell.
“For a community that literally has Ridley’s and an Albertsons but nothing else, I think that really helps,” she says.
Q: How did you get into this industry?
Hume: I got my undergraduate in psychology [from Boise State University]. And for lack of anything better to do, I kind of just went into the master’s program to be a school counselor.
As I was going to grad school, I was working full time in the website development business with one of my best friends from college. And literally, people were telling us, “I don’t think this website thing is going to catch on.” This was 1996, 1997, and they were saying, “I just don’t know that we actually need a website. I’m not sure that’s a good investment for us.” We hit the market a little early for that type of business.
This opportunity came up at Albertsons and a friend told me about it. It seemed like it would be a natural fit for me, because I grew up in a real estate family. My dad had his own real estate company in Nampa from 1973 until just recently — Bill Thompson and Co. — so I grew up in that world.
I got hired [at Albertsons] with three other gentlemen. We were charged to build Albertsons Express gas stations. We were really lucky to be trained in the Albertsons program at that time, because it was the glory days of Albertsons prior to the American Stores merger [which changed the course of the company]. Gary Michael was our CEO. It was just a wonderful place to work, and we got trained by some pretty incredible people. I just fell in love with the business from there.
Eventually, I was ready to not travel so much and had little kids. So I went into brokerage 13 years ago and never looked back.
Shropshire: I moved to Boise a little over five years ago and really had no game plan at all. I graduated [from Idaho State University] and decided to live here. I moved over, looked for a job, and [learned about commercial real estate] through a friend of a friend who had just bought a commercial building — right as this office was coming together. I met with a couple people that were brokers here, and I met with LeAnn.
I really had no idea about commercial real estate. I thought, you know, this could actually work. My degree is in marketing; it makes a lot of sense. So I ended up getting my license and sent LeAnn an email, and within a week or so, I was here.
Nilson: I came out of [The College of Idaho] and started at Albertsons’ corporate office in the pharmacy business-development department, which was basically going out and helping them acquire pharmacies all across the country. Cold-calling on independent pharmacists and trying to convince them to sell their business and go work for Albertsons.
Which is a really interesting job right out of college. You had no cellphones, so it’s the AAA map spread across the steering wheel, in a place you’ve never been before, driving around talking to strangers about a business you don’t know that much about because you just started. It’s basically like setting yourself up for rejection. I felt like I was selling vacuum cleaners for a while. I think that job prepared me to come up with creative solutions and think outside the box a little bit.
There was an internal real estate [position at] Albertsons, and the gal that was the head of that department was well-known throughout the company to be very tough. I think I may have been the only person that applied. So I got the job. The fact that she was tough on me kind of made me the way I am today. She’s one of my best friends. We do a lot of business with her.
I ended up staying with Albertsons for eight years doing internal corporate real estate through the merger with American Stores and the sale to Supervalu and the spinoff to Cerberus. Finally, I got to the point where I felt like I was going to too many meetings to meet about meetings to have some more meetings about them.
I was approached by a developer in Southern California, and I went on to the development side of the business and worked out of an office of my own here. My partners were in California. I worked on the development side in the worst economic downturn we ever had, and I survived that.
One day, LeAnn started putting the bug in my year about trying brokerage, and it was like, “You know I could never be a broker. I don’t think I would be very good at that.”
Now that I am, I can’t imagine doing anything else.
Q: What do you think makes a successful broker?
Hume: You have to be very tenacious, intelligent, articulate.
Shropshire: It’s not something where you can come in and someone hands you a handbook and says, “Let me train you and teach you and you can learn.” You dive in, and you hope that you float.
You get in every day and hit the ground running. ... I say it’s when you get in, but it’s more when you wake up and look at your phone and see your emails.
Hume: You really have to have the temperament for this business. It can be brutal at times. Deals can take years to come together. I think that sometimes, the perception can be that we do very well financially and it must look easy from the outside. If you actually get into this business, you know that you make money on about 20 percent of what you work on.
It’s a tough business, and if you’re willing to stick it out for two years before you end up making money, and then you’re really committed to learning, then it is a great profession. But it’s not for the faint of heart, for sure.
Q: What are some deals you’ve done as a team?
Hume: We’ve done Starbucks deals. We did all the Freddy’s Frozen Custard & Steakburgers deals. We did all the Popeyes deals. All the Dollar Tree deals. Chipotle, Noodles and Co., Jersey Mike’s Subs. We did all the Cafe Zupas deals.
We quarterbacked these deals. We are dealing with a huge team — between title companies, attorneys, architects, tenants, landlords. We have this huge team of people, and we are the person that’s trying to keep everybody moving toward a finish line of some sort.
Imagine a room full of 100 balloons, and we are constantly, between the three of us, tapping each of these balloons to make sure none of those balloons are popping, hitting the floor or anything.
Shropshire: We have had several tenants — Cafe Zupas being one of them — we love working with them, we love their product. They came to us and said, “We need to do X amount of stores in your market within this time frame.”
It’s not just, “Here’s this open space; you can go in there.” There’s so much science and data that goes into what makes the most sense for where you need to be to be successful.
Q: What’s it like being a team of women in a male-dominated industry?
Hume: We don’t think about it much until we pause and think that women represent about 10 percent of commercial practitioners. And we go to these huge conferences in Vegas, and that’s about right: One in 10 is a woman.
We don’t think about it a lot, but we’re really proud of it.
Shropshire: The first thing that popped in my head when you said that is, “Well, I’ve never been part of a team of men, so I don’t know what the difference is.” I think our success shows that [gender] doesn’t matter as much. We have our run-ins with the guys that are older — from a different generation — we still run into that every once in a while.
Nilson: I think it’s pretty awesome. Like any field that’s male-dominated, I think we kind of offset some of that with the level of experience and transactions we’ve completed. I think we’ve earned our stripes.
Hume: We bring something unique to a male-dominated trade. We’re tough negotiators, but fair. We’re educated. We take it very seriously. But we also have this element, I think, that brings a lot of enjoyment and levity to these deals. We have the ability as females that it’s not all business all the time. You do develop relationships with people, and maybe have a little more intuition on things and creativity that we bring to deals.
Not that men don’t do that. But we’re not just a team of ladies and we handle it all like ladies. You have to have a backbone in this business and a thick skin.
We do have the ability to communicate things in a way that doesn’t come across as aggressive. In a way that takes advantage of our skills as charming women. [Laughter from everyone.]
Q: What are your favorite deals?
Nilson: Deals like the one we did on Broadway [between Howe and Warren streets] with all the old houses, and now it’s Black Rock Coffee Bar and Popeyes and Jersey Mike’s Subs.
I love working on the tenant’s side of things, which a lot of brokers don’t like because it’s such a tremendous amount of work. A lot of driving. I was with a tenant [recently]. We drove from here to Buhl, Rupert, Gooding, Twin Falls, Shelley, Rigby, Preston. Up to Dillon, Montana. Hailey. Salmon. It was 1,300 miles and two days of driving, which included a dirt road and a small mountain pass that weren’t really on the map.
Q: Is anyone new coming in? When are we getting an IKEA?
Nilson: I’ve called IKEA a million times — and, yes, I have a perfect location in mind for them right now.
Hume: They say they need one million people in the MSA. And we’re about 680,000 now?
Nilson: I like to use the stats that The Village at Meridian uses. They use a draw of one million people. ... We’re working on ’em.
Hume: In-N-Out, we always get that question: “When is In-N-Out coming?” And that’s a distribution issue. A lot of [barriers to] entry are distribution-driven, or they have to solve that before they get in here.
Q: Who did you bring here, after they were on your wish list?
Nilson: They put it on hold, went and chased another market, then we were able to convince them to come back. We worked hard to get the sites that they got. None of those were easy deals. The one in Nampa was unbelievable that we were able to get that site. The timing just worked out great there.
Q: What are some big deals you’ve worked on recently?
Nilson: The company we both started with — Albertsons — to see them active again in the market, and for us to be able to be part of that, has been really fun. We helped them buy the entire shopping center at Broadway and ParkCenter, and we helped them on their acquisition at Eagle and Amity, which is a huge growth area. And the Barber Station project. So it’s fun to have the company that we started with, that really got us into real estate, in our backyard active again, and to be working with them. They are absolutely, in my opinion, the premier grocer in the Treasure Valley.
Hume: We’re also involved in the baseball stadium project. We were originally going to do a baseball stadium by Boise State. That didn’t work out at the last minute. So we were now the proud owners of Hong Kong Spa and the Beach Club Tanning Salon, and we are redeveloping those two buildings — tearing them down and building a brand-new retail building with two or three tenants on that corner.
And that’s the same developer that owns the Hawks, that will be doing the stadium on Americana. Long term, we’ll be doing all the leasing for them. Our office team will be doing the office leasing. We’ll do the retail leasing for them on all the mixed-use we’ll have out there. It’s already been 3 1/2 years since we started, and it’s just gone by like that. We’ve been working on that for a long time, and I’m hoping now [knocks on wood] that we finally are in the spot.
Q: Where is the Treasure Valley now, in terms of commercial real estate?
Hume: We’ve talked for a long time on the investment side about how we have a lot of money coming in from California — that people have sold property there, and they can come buy a Popeyes here for the same income stream at a better return.
But that pushed our cap rates down, too, and the supply. So I think we’re still a really strong market. I don’t know that we’re going to see cap rates come down anymore. [The capitalization, or cap, rate is the expected rate of return on a real estate investment. Rates of 6 percent to 10 percent per year have been common in the Treasure Valley, with recent rates at the low end of that range because of high demand from real estate investors.]
Nilson: I think what people say is they’ll look at retail and think, “Oh my gosh, these big boxes are closing. What’s happening to retail?” But there’s always movement in the market, and as soon as one of those closes, it either gets split up into new spaces or another new concept emerges that takes the whole space.
Macy’s, J.C. Penney and Kohl’s ... they’re closing, but Target is thriving. Kmarts are closing everywhere. But, to me, it’s: Who is the superior concept now? It’s not J.C. Penney anymore. You look at Athleta, they’re opening. Hope Ave. You’ve got a resurgence of small boutiques Downtown. People like that smaller feel. They like to feel like that place is special in some way, shape or form.
Q: With all those new openings, are we getting saturated?
Hume: I think we have a long way to go before we get saturated. We’re kind of like the next Denver. In 20 years. That’s what we’ve been compared to on the retail side. We have a lot of deals left to do.
I’ve lived here my entire life. ... The growth has been tremendous, and we love seeing people come in who want to live the same quality of life as we do. And we’re also retail connoisseurs, obviously, and we enjoy that part of the research that we do.
We want to see growth here, and we think we will. It’s been fun to watch this community get bigger, more mature, and we are at the point now where I think in our industry, being specialists and being a team is really important. We’re just too big now to do it any other way.
Audrey Dutton: 208-377-6448, @audreydutton. This story appears in the May 17-June 20, 2017, edition of the Idaho Statesman’s Business Insider magazine as part of a special section on people who have shaped the Treasure Valley. Click here for the Statesman’s e-edition, which includes Business Insider (subscription required).