Carl Lindell Jr. is selling his dealerships in Tampa and St. Petersburg to concentrate on residential real estate.
TAMPA - After 35 years in the car business, Carl Lindell Jr. is sure of one thing: There are easier ways to make a living.
"When people come in to buy a new car, they want us to take their old one in trade. They have a Rambler they think is worth $6,000, so we're arguing at the very beginning, then I have to figure out what to do with it," he said. "Plus you've got 35 salesmen out there on the lot and you're hoping they're all telling the customer what you want them to say."
For those reasons and more, the high-profile Tampa businessman is selling his Honda and Volkswagen dealerships on Kennedy Boulevard next month and has put up for sale his Mazda dealership in St. Petersburg.
The buyer of Lindell's Tampa dealerships is Direct Automotive Management, whose principal, Jason Kuhn, previously owned auto businesses in Hudson and Gainesville.
Terms of the deal, expected to close Feb. 2, were not disclosed.
Far from retiring, Lindell, 59, intends to devote himself to an activity that has consumed a growing portion of his time over the past five years: residential real estate development.
After more than three decades on the car lot, Lindell said, the task of turning raw ground into multimillion-dollar residential developments looks like a piece of cake.
"There are only so many hours in a day, and I haven't been paying attention to the dealerships for maybe the past 18 months," said Lindell, who, with partner Ron Weisser, is involved in major development projects in Pasco, Hillsborough and Manatee counties. "These two car dealerships (in Tampa) are a $130-million retail operation with 250 employees, and it turned out to be something I was doing on the side. I've had a good, long run."
Kuhn, 34, signed an agreement to buy the Tampa dealerships in October and has spent the last few months on site, getting to know employees.
"I'm not going to be making any changes," said Kuhn, who will be president and general manager of the businesses, which include new and used cars, as well as collision repair. "I'm keeping the management team and I'll be here 14 hours a day running the place. Carl represents good product lines, he has a good location and great operation. It's an expensive dealership and it deserves to be."
Gordon Wangers, president of AMI, an automotive consulting company in Marina del Rey, Calif., estimated that sale price of the three Lindell dealerships, including real estate, could range from $25-million to $50-million. Lindell and Kuhn declined to comment on his estimate.
"The Honda nameplate is considered a license to print money," Wangers said. "It's generally extremely profitable because Honda customers come to you. Volkswagen's got some new products coming in, but they have some challenges."
Wangers said Mazda is generally seen as the least desirable brand of the three. Lindell said his Mazda dealership, in St. Petersburg's Tyrone area, has 54 employees and sales of nearly $32-million last year.
Though publicly traded car dealerships like AutoNation Inc. of Fort Lauderdale have dominated dealer acquisitions over the past seven years, acquiring many family franchises nationwide, Lindell said he believes private owners will always have an advantage.
"A family puts its name on the dealership and its whole life into the business," Lindell said. "It's harder for a public company to recreate what a really good owner/operator does."
Lindell had a tentative agreement to sell his three dealerships in 1997 to Ferman Motor Car Co., another Tampa Bay area franchise. That deal fell through when the parties failed to reach terms.
Kuhn said he's confident his acquisition of the two Lindell dealerships will proceed smoothly.
"Sometimes these deals are difficult for both parties, but this has been a real pleasure," Kuhn said of the negotiations. "Carl has given me unfettered access to the operations, which is really unheard of. I think it helps that we had a friendship before we had a business relationship."
Kuhn plans to remove the Lindell name from the Honda and VW dealerships within a year. Until 2002, Kuhn owned Bay Ford in Hudson; before that, from 1998 to 2000, he owned Direct Imports in Gainesville. That business handled BMW, Porsche, VW and Acura, with sales quadrupling to $40-million in two years, he said.
Educated as a tax attorney, Kuhn married into a family with ties to the auto business. After law school at New York University, he went to work for his wife's uncle, Norman Braman, who owns eight dealerships in Miami, Palm Beach and Denver. His father-in-law, Ed Leibowitz, owned Bay Automotive Group, which had Cadillac, Chrysler, Nissan, Acura and Mazda dealerships in Tampa until the early 1990s. Leibowitz, other family members and St. Petersburg tire retailer Larry Morgan will be investors with Kuhn in the Lindell dealerships.
Lindell, who has an MBA from Emory University, bought the VW dealership from his father in 1969, seven years after it opened. He added the Honda brand in 1976 and Mazda in 1987. Until the late 1990s, he also owned an Acura, Hyundai, Subaru and VW dealership in Sarasota, which he sold to Jim Gettle.
Lindell, whose 18-year-old son and 13-year-old daughter are not interested in the car business, doesn't want to discourage the next generation of auto dealers. But he is candid about the challenges of running a business with hundreds of employees and so many disparate parts. "First, you have people bringing in a car they bought from us six years ago, a year we sold 25 different models, and we have to have the parts, know where to find them and have someone who remembers how to fix the car," he said.
"Then you have people who wreck their cars and want us to make them look like new," Lindell continued. "And financing, insuring and service contracts have become a huge part of our business."
Lindell and Weisser, a civil engineer, are developing Wilderness Lake Preserve in Pasco County's Land O'Lakes. The 680-acre project is about midway through a five-year development plan, with 250 homes of 900 completed. Homes, which are being constructed by six builders, range from $140,000 to $1-million.
On Gunn Highway in Hillsborough County, the two men have developed Keystone Shores, a project with homes ranging from $800,000 to $2-million. All but six of 36 lots have been sold.
On Harbour Island, Lindell Properties plans to break ground by yearend on three 20-story condo towers. The $250-million development is a joint venture with Patrinely Group, high-rise developers from Houston.
In Manatee County, Lindell's company is acting as developer for Lennar Homes on a 214-home project, Imperial Lake Woods. Next under consideration: a 1,700-acre development in Fort Myers.
"We do the acquisition, permitting, improvements, sewer and water, then sell to the developer over time as they need it," Weisser said. "Big builders can only do so much. We have the development expertise and capital resources that we can be an additional source of inventory."
Weisser said development appeals to Lindell's creative urge. But there have been times when he has to rein in his partner.
"I walked away from 2,200 acres in Jacksonville because Ron convinced me the clay content in the soil would make it too expensive to develop," Lindell said. "One thing he's taught me is that water runs downhill. But I still wish I'd bought that property."
- Kris Hundley can be reached at firstname.lastname@example.org or 727 892-2996.Carl Lindell Jr.
Title: Chairman, Lindell Motors; chairman, Lindell Properties
Education: University of North Carolina-Chapel Hill, undergraduate degree in English literature; Emory University, MBA
Car dealerships: Lindell VW and Honda, Tampa; Lindell Mazda, St. Petersburg
Real estate projects: Wilderness Lake Preserve, Land O'Lakes; Keystone Shores, Tampa; Harbor Island high-rises, Tampa; Imperial Lake Woods, Manatee County
Community board positions: Tampa Bay Partnership, Lowry Park Zoo, Florida Aquarium
Philanthropy: $1-million to Gulf Ridge Council of the Boy Scouts of America in 2001