Multinational cigar importer Oettinger Davidoff Group relocates to Pinellas Park

From left, Ken Heretick, C.J. Evans, and Ned Willis helped relocate a multinational cigar importer to the bay area.

JAMES BORCHUCK | Times

From left, Ken Heretick, C.J. Evans, and Ned Willis helped relocate a multinational cigar importer to the bay area.

The best news in years for Ybor City's cigar industry came together off the official radar, and landed in Pinellas Park.

A Swiss cigar importer's choice for its U.S. headquarters, announced in February, means 90 jobs, nearly $10 million in capital investment and crucial bragging rights.

To Tampa's cigar families, the choice over incentive-rich Texas or South Carolina says that in the world of luxury tobacco, the bay area still matters. Not that they knew Oettinger Davidoff Group was looking to relocate from Stamford, Conn. One small team slowly put the deal together, alerting economic development officials only after a few key locations made the cut.

It all started long before the Pinellas Park building was empty, a tale of coincidence and common sense spanning decades, continents and oceans.

• • •

The genealogy of the deal goes back 30 years, when one man set down a narrow root in the bay area that helped it emerge as a prime candidate for Davidoff.

That's when Oscar Avallone, an Italian living in Switzerland who parlays cultural sensitivity and fluency in five languages into his role as a corporate consultant, first visited Tampa Bay. Fine weather and a comfortable, nontourist vibe kept him coming back. By the early '90s he frequented a waterfront condo, flying direct Zurich to Miami and hopping in a car to the west coast.

A decade later, Avallone met businessman Vince Fabrizzi of Tampa software services company Jagged Peak at an event in Manhattan. Back in the bay area, they would go out for dinner and smoke cigars.

Hand-rolled tobacco, Tampa's artisan tradition sparked by Cuba's closeness and a railroad, has been nurtured around its steamy port since the 1880s. While the cigarmaking itself has moved mostly offshore, businesses born of its legacy keep Tampa America's cigar city. A renaissance in recent decades once again celebrates the "cigar lifestyle," even as governments increasingly tax it.

In 2007, Fabrizzi introduced Avallone to friend Ken Heretick, a St. Petersburg commercial real estate consultant. Heretick's Pass-a-Grille home, as it turned out, was five minutes from Avallone's condo.

Fabrizzi, the software guy, and Heretick, the real estate guy, had met not in Tampa Bay, but on a Lake Tahoe ski slope on the other side of the continent. Turned out they attended the same Catholic church back home.

Now the three reminisced about family ties to Italy. They networked. They connected one another with business.

Avallone had just the project for Heretick.

•••

Among Avallone's multinational clients was Davidoff. He aided its acquisitions of Camacho Cigars in Miami in 2008 and Cusano Cigars in Bradenton in 2009. When Davidoff sought a new American headquarters, Avallone coordinated teams of site consultants, including in Texas and South Carolina. Heretick's Vector Commercial Real Estate Services anchored Florida.

They began to talk about attractive sites at the end of 2008. Those talks turned into a list of about 25 locations, which became 12. Heretick brought in an economic development consultant from Tampa, C.J. Evans of tax firm Ryan Inc., to crunch the numbers. Less than six months and reams of data later, the team had narrowed regional options to three buildings, in Tampa, Ruskin and Sarasota. Those locations would compete with others in Texas, and most tempting, the Charleston area of South Carolina — a region with its own port and tobacco history.

Florida had a problem.

As the site team combed through details — demographics, workforce data — the state Senate was trying to close a budget gap. One option was a tobacco tax. And unlike the House, the Senate treated cigars like any other tobacco product.

For a multinational company with its pick of states, that tax could be a deal-killer.

Gov. Charlie Crist urged lawmakers to exclude cigars. Tampa cigar companies pleaded for protection of a "home industry" from the trend. A federal tax hike would soon be blamed for the loss of the Hav-A-Tampa cigar plant near E Broadway Avenue, and 500 jobs.

Davidoff watched, and waited.

Meanwhile, the top three Florida sites — Tampa, Ruskin and Sarasota — suddenly got a fourth: Pinellas Park.

Ned Willis, a broker in Heretick's office, heard a tip: Hunter Douglas, which had a Pinellas Park plant, was preparing to move the work of nearly 200 employees to new facilities in Maryland, Utah and California. The team got a tour.

Heretick marvels at it now: "Sometimes that's how it happens. The best deal is the one that falls in your lap."

In 1997, Hunter Douglas Fabrication Co. was among the original companies to lease space in a brand new $25 million Gateway Business Centre built by Miami Beach developer David Fleeman. Curving roads with easy access from Interstate 275 and U.S. 19 wove through parklike spaces broken by broad, sand-colored buildings with sea-green diamond detail. Hunter Douglas' 90,000-square-foot manufacturing facility nestled among buildings for Lockheed Martin Corp., Spectrum/NCS Health Care and Airborne Express.

The building required less work than most to accommodate Davidoff's needs for warehousing, distribution and office space. It stood up to rigorous testing requested by Avallone's Swiss clients, even X-rays to check rebar in the walls and thermal scans to rule out moisture in the roof. It could attract a workforce from Tampa, Clearwater or St. Petersburg.

And then came more good news for the deal: The state's tobacco tax would exclude cigars. Hunter Douglas looked better all the time.

But the deal wasn't over. The spot could be ideal, but governments still had to play ball.

• • •

Landing Davidoff would mean 90 jobs with an average wage of about $55,000 a year. A corporate headquarters was also attractive to Florida, even if it didn't fit other desirable categories such as clean energy or biotech.

Once a state decides to recruit a company, a machine shudders into motion. Its product: incentives.

As Avallone's site team compiled its contenders, tax guy Evans had called up Enterprise Florida, the public-private development agency that recommends incentives packages to the Governor's Office. By August, Enterprise Florida reached out to Pinellas County Economic Development. The county tapped the city of Pinellas Park.

That meant Bob Bray.

Bray, a community planning director who has worked for the city 25 years, represents the front line of economic development.

He wants businesses to pick Pinellas Park. When the county calls, the question is, How can you work with them?

Here's how a city helps: It can waive permit fees. It can offer faster permit processing — in Pinellas Park, a 10-day turnaround for the first review, instead of 30-plus. It can scramble to sort out zoning issues, as when Davidoff asked about building a prototype cigar bar it could model around the world. (A look back 25 years turned up a helpful development order. No rezoning required.)

"We look at things very closely, and we try to make it right by the customer and by law," Bray says.

A $7.15 million contract for the building closed in September.

Davidoff's package ultimately included tax refunds for every new job, through Florida's Qualified Target Industry program; $240,000 from the governor's Quick Action Closing Fund; $20,000 from the county; and tax and fee reductions from Pinellas Park that could reach $64,000.

While incentives matter, this deal came down to more than just money.

The Tampa Bay was already an "industry cluster." (Hollywood has studios; Orlando has theme parks; Tampa Bay has cigars.) It also had proximity, both to South Florida, where Davidoff cigars arrive hand-rolled from the Dominican Republic and Honduras, and to newly acquired companies in Bradenton and Miami.

"They've basically done everything to make it happen," Avallone said recently, as he visited with Heretick to work out details of the headquarters' fall opening. "Other states were giving a lot more incentives. At the end, the fact that cigar history exists in this area was important."

That's how Pinellas Park joined the Cigar City fold.

Becky Bowers can be reached at bbowers@sptimes.com or (727) 893-8859. Follow her on Twitter at twitter.com/bbowerstimes.

Multinational cigar importer Oettinger Davidoff Group relocates to Pinellas Park 05/08/10 [Last modified: Friday, May 7, 2010 9:50pm]

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