Easy money? Not really, says Ted Kraus of TKO Real Estate Advisory Group, who has pocketed $750,000 for his website name, www.property.com.
It took just a week to do the deal, says Kraus, speaking by cellphone from Florida on August 15. No other domain name sold for more money this year, though one sale - www.website.com - got the same price.
Nevertheless, Kraus had been marketing that website behind the scenes since 1989, well before the dotcom craze or even the general use of the Internet, and he had built it up to an impressive 2 million unique visitors a year. "It took a week to close the deal and 16 years to create the value," says Kraus.
Most of the visitors to the website were not potential clients for Kraus, who manages real estate, does Internet marketing programs for real estate companies, and represents Burlington Coat Factory. "We used it as institutional advertising. All I needed was one person to hire me to manage their center. or make one Burlington Coat deal and I was a happy trooper," says Kraus.
He also used the www.property.com site to market his newsletter, called Dealmakers, which has its own website, www.dealmakers.com. "We picked up 3,000 free trial subscriptions for the Dealmakers newsletter, and five percent of those would convert to pay for it for $279. Then we have 25,000 E-mail members for our forums of properties for sale or lease."
Without www.property.com to attract new clients and subscribers, Kraus will have to use some of his windfall to pay for a different kind of marketing. Already, visitors at the www.dealmakers.net have dropped from 6,000 per week to 3,200 per week, and Kraus says he will have to quadruple his marketing expenses.
Kraus says he entertained frequent offers to buy his website name. "It's probably worth $1 million, but it's very difficult when somebody offers you $750,000," he says. "I can be bought."
In contrast, Steve Sashihara, CEO of Princeton Consultants on Research Way, has not been besieged by offers for www.princeton.com - even when you take into consideration that a Princeton-named website has less commercial viability than one with a generic business name.
"Personally I don't think our website name is all that valuable," Sashihara says, who, like Kraus, made an early entry to the web business. "If someone were offering to pay us millions, we have missed the opportunity, because we put them in the same E-mail box as offshore opportunities and health remedies."
Sashihara decries the importance of either the website or business name and points to Wal-Mart and Amazon as not being "great" names that a particularly evocative or excitingly proprietary. "While I think a nice name and URL is helpful, my experience is that some very successful companies have poor names," says Sashihara.
That's not what the cyber-experts said during the "tulip mania" phase of the Internet. "During the height of the dotcoms we were offered $2 million in stock for the website name, but I wasn't willing to do that," says Kraus. "I wanted small, unmarked bills."
Kraus remembers one other memorable deal. He sold a shopping center in Knoxville, Tennessee, for $30 million, and the commission amounted to an equivalent sum. "It took us four years to lease it up and six months to sell it, and that got us the sale price," he says. But not many deals are so remunerative. "Or I'd be on a tropical island."
The Florida-based buyer of Kraus's name, property.com, Rick Schwartz, is a web mogul who owns 5,000 domain names that reportedly attract a total of 100,000 visitors a day. Schwartz banks on the idea of direct navigation: Some web users bypass search engines and simply type in a generic name. Among Schwartz's successful websites are www.tradeshow.com, virtualtours.com, and even www.porno.com. He has been quoted as saying he paid $42,000 for the latter and that he has made millions on it.
Kraus says he never even talked to Schwartz until the day he signed the agreement, that they did their negotiating by E-mail. But on the day of the interview he was in Florida on some other business and planning to meet Schwartz. "We are meeting just to have dinner, just to celebrate," says Kraus.
TKO Real Estate Advisory Group Inc., 100 Youngs Road, Box 2630, Mercerville 08690. Ted Kraus, president. 609-587-6200; fax, 609-587-3511. Home page: www.property.com
Hospital Going Where?
Complaining neighbors have been thorns in the side of the University Medical Center for 15 years, and now the prospect of unpleasant neighbor relations could affect the hospital's choice of a new location.
For two years now the University Medical Center at Princeton has wanted to leave its nine-acre Witherspoon Street location and move to a minimum of 50 acres. The possible sites have reportedly been narrowed down from more than a dozen to two - Carnegie Center West and the Forrestal Center, north of Princeton Forrestal Village.
The Canal Pointe Condominium Association's Board of Trustees has thrown down the gauntlet. In a letter to Barry Rabner, CEO of the University Medical Center, the board has shouted its opposition to becoming the backyard of the new hospital the medical center is intending to build.
David Wolfe, president of the condo board, points out that the 75-acre Carnegie Center West site, located across Route 1 from the Bank of America building, is not zoned for a hospital, and vows that the condo association will utilize its "considerable resources to see that this project is never built at Carnegie Center."
The condo board is concerned that the construction of a large medical center across the street from the homes of Canal Pointe residents will "adversely affect our quality of life and, consequently, the property values in this area."
That threat surely would not be taken lightly by the medical center, which is only too well aware of problems that unhappy neighbors can cause. When the medical center desperately needed to expand and bought nearby houses on Harris Road to use for office space, residents on that street drummed up bitter and vituperative resistance. So the prospect of a bloody zoning battle might seem daunting now.
Under the current West Windsor administration, the medical center would need to work with the affected residents by holding public forums before a proposal is submitted. After the proposal is reviewed, the master plan and the zoning would need to be changed, and the zoning change would need to get approval from council.
"We would not take any applications before we have an opportunity to review the proposal," says West Windsor's Mayor Shing-Fu Hsueh. "It will be reviewed on the basis of what will be the best for all of West Windsor."
"We have not had the opportunity to meet with any Canal Pointe residents to hear their concerns and share information, but we would welcome this opportunity," says Carol Norris, medical center vice president of marketing and public affairs. She says she has been contacted by West Windsor residents who support having the hospital in their community.
"To our knowledge the hospital has not finalized a selection as to where they will relocate from downtown Princeton," says Micky Landis, vice president of Boston Properties, which owns the Carnegie West site.
If the hospital is not built in West Windsor, the Carnegie West site has approvals in place to build 1 million square feet of office and hotel space, or more than half of what has been erected at the Carnegie Center on the east side of Route 1 so far. Rush hour traffic for office use is considered to be greater than for a hospital.
The other most likely choice would be the 260-acre Forrestal Center location - 110 acres in Plainsboro, 160 in South Brunswick - part of the Princeton Nurseries land that the Forrestal developers bought in 1986. The available space is adjacent to and north of Princeton Forrestal Village. The hospital could choose a spot in either township or one that spans both.
Traffic access could be from Independence Way, College Road, Ridge Road, or Route 27, but most cars would come from Route 1. "The whole focus of the land preservation that we did was to overwhelmingly concentrate the traffic onto Route 1," says David Knights of Picus Associates.
The good news for the hospital is that, here, there would be no complaining homeowners. The only adjoining residences are rental units in the Barclay Square development. For the first decade of their existence, no one is allowed to own these units.
It goes without saying that the Gale Company, which owns Forrestal Village, and also the owners of the assisted living center, would be thrilled to have the hospital as a neighbor. The hospital's moving in would fulfill the Village's long-awaited potential and its owners already are working to populate the Village with professional offices.
A third choice could become more attractive - the former Union Camp site on Princeton Pike in Lawrence. The 134-acre tract was supposed to have become new corporate campus for RCN, which had paid $25.5 million for the land. When the telecom suffered financial woes, it sold the property to Bristol-Myers Squibb, which has not announced any plans to use it. Approvals are in place for a 10-building, 1.5 million square-foot complex. This location would seem to be too close to Capital Health's proposed expansion just a few blocks south, but the real deal breaker could be the rush hour traffic problem on Princeton Pike.
Earlier this spring the medical center had vowed to announce its choice before its June Fete. Norris says the medical center "is considering "all appropriate sites within two to six miles of our current hospital campus."
Blind Rivets vs. Cell Phone Displays
As one 21st century technology expands, a traditional manufacturing company has downsized. After a 50-year-old rivet manufacturer sold its Phillips Drive building to Universal Display Corporation, which develops new displays for cell phones and cameras. it moved to a 6,500-foot leased space at Crossroads Corporate Center.
"We no longer needed manufacturing or distribution space," says Guy Krone, CEO of Gesipa Fasteners USA, makers of blind rivets, "and it made sense to lease rather than own."
Blind rivets, says Krone, are permanent fasteners used in almost every industry - automotive, metal building, and even computer chassis. A common example of a blind rivet is the attachment for aluminum gutters that can be installed without access to the back side.
From 1955 to 1995 Gesipa had had a manufacturing plant in Trenton, but the workforce had dwindled to 20 people, and Krone closed it down 10 years ago. "People would rather not work in factory environments on machinery with a lot of oil," says Krone. "And you don't want to leave the machinery idle, but it is very difficult to get people to work on a second shift."
But unlike companies that shuttered all their United States operations and moved to China or Mexico, Gesipa has stayed firmly planted in the United States. It has a 70-person plant in a small town near Shreveport, Louisiana; a 35-worker plant near Winston Salem, North Carolina; and has just bought a 75,000 square-foot plant in North Carolina.
In 1975 Gesipa introduced its automatic-feed blind riveting system, and with the purchase of another company in 1990 it added the Bulb-Tite and Mega-Grip structural blind rivets. Recently, the firm acquired Action Tool Inc. of Winston-Salem.
The company, owned by the Biermann family, is headquartered in Walldorf, Germany (near Frankfurt), and it also has factories in England, Poland, and Brazil. Krone has been in the fastener industry since he graduated from Rutgers in 1973, and he joined this company in 1991. He and his wife have two grown sons.
"We are seeing more manufacturing operations leave the States," he says, "and though the overall market is not shrinking, certain segments are."
Krone recruits management candidates from industry centers in Illinois, New England, or the west coast. "You need to be able to lure people to where your facility is. If we need upper management and engineering, it's very easy to get people from the north to go to North Carolina," he says. "It is very difficult to get them to Louisiana or New Jersey." Though Jacksonville and Charleston have the requisite geography (they are near to ports), their hot southern climates are not appealing to Northerners.
"Plus, North Carolina was very aggressive," says Krone. "We definitely received training and tax incentives. The problem in New Jersey is the tax burden."
Gesipa Fasteners USA, 3150 Brunswick Pike, Crossroads Corporate Center, Suite 310, Lawrenceville 08648. Guy Krone, president. 609-883-8300; fax, 609-883-8301. Home page: www.gesipausa.com
Good News at UDC
Futuristic communications devices for the military, cellphone displays in unusual shapes, and better and cheaper lighting - these are among the 21st century products under development at Universal Display Corporation, which incubated at Princeton University.
Just announced: for the fourth year in a row, UDC has been named to Deloitte & Touche LLP's technology fast 50 program. With a revenue increase of 1,321 percent from 2000 to 2004, it was the 11th fastest growing company in New Jersey.
Last year it occupied 21,000 square feet on Phillips Boulevard. Now it has bought the building from Gesipa Fasteners USA for $5 million. UDC currently occupies 32,000 square feet, and the unfinished warehouse and office space is being fitted out by Sweetwater Construction. The company already has a state-of-the-art pilot production line.
UDC's technologies include organic light emitting devices (OLEDs) and phosphorescent organic light emitting devices, or PHOLEDs. UDC now needs chemistry laboratory space, because it is selling phosphorescent materials for commercial use. "Our material business has grown to a couple of million dollars a year, which would represent about a third of our revenues," says Janice Mahon, vice president. In a conference call the company revealed that it shipped developmental chemicals to 10 customers so far this year, compared to four customers in 2004.
In UDC's new building, an additional 8,000 feet for chemistry labs and support space is in the design phase. When that is finished, the temporary space leased on Deer Park Drive will close.
Phosphorescence is found in nature in fireflies, submarine bioluminescence, and jellyfish that glow. "We have not converted the natural materials into an OLED display," says Mahon. "At the basic research level we continue to look to nature to see if there are analogs, materials that might enhance our chemistry work, But so far nothing has translated directly into a research opportunity."
In addition to Princeton University, UDC is partnered with the University of Southern California and PPG Industries Inc., and it has development agreements with DuPont, Sony Corporation, Samsung SDI, Toyota, and AV Optronics for flat panel displays and other opto-electronic applications.
A significant milestone (achieving a commercially viable phosphorescent blue color) and a licensing agreement (for Samsung SDI to integrate OLED into active matrix displays) buoyed investors in the most recent quarter, she says. "At every meeting, they would ask, when are you going to have a license agreement, and when are you going to have 'blue progress.'"
"Our March licensing agreement with Samsung truly validates our business model," she says, noting that Samsung SDI considers itself the world leader in OLED products today. "We communicated to our shareholder base that we do have an important portfolio. And in June we demonstrated, in the blue realm, that we had a product with a commercially viable lifetime."
UDC also made good progress in white power efficiency - white OLED light emission - which is five to ten years away from going on the commercial market. "There is a healthy horse race in use the of OLEDs for lighting," she says, noting that GE, Philips, and Osram are major competitors. Achieving 30 lumens per watt toward a goal of 100 lumens per watt "is not so much a huge leapfrog but a nice advance in continued progress. But we are not near to meeting our cost targets."
UDC also just received a two year, $1.7 million, Small Business Innovation Phase III contract from the defense department to continue work on its military communication device. UDC now has had a total of $6 million in government contracts.
"We increased revenues and reduced losses," said Steven Abramson in an investor call. The company's cash position is $45.8 million versus $49.4 million at the end of last year.
The market for LCDs and/or OLEDs could reach more than $90 million in three years, according to one estimate, and the OLED market alone should increase from $316 million last year to more than $5 billion in 2008. Eastman Kodak Company's fluorescent OLED technology is the major competitor.
Organic Light Emitting Device (OLED) displays are not on the market yet, but if they do replace liquid crystal displays (LCDs) and plasma displays, the first applications will likely be for such portable electronic consumer devices as mobile phones, personal digital assistants (PDAs), cameras, camcorders, and electronic games. OLEDs have these advantages: brightness, power efficiency, viewing angle, video response time, and manufacturing cost.
Universal Display Corp. (PANL), 375 Phillips Boulevard, Ewing 08618. Steven Abramson, president. 609-671-0980; fax, 609-671-0995. www.universaldisplay.com
Castle on Route 33: Make a Wish
If auto mogul Steve Kalafer's wish comes true, he will build a minor league ballpark along Route 33 in Monroe Township, part of a new transit village that will also host the new headquarters of the Make-A-Wish Foundation of New Jersey www.wishnj.org)
Jack Morris of Edgewood Properties has donated seven acres to build the 20,000-square-foot charity headquarters, scheduled to be completed by 2007. The headquarters would be part of a mixed-use Route 33 development project that would also include the ballpark, national retailers, upscale residential units, and a park and ride lot. About half of the land would consist of walking trails and parks.
Kalafer, who is chairman of the Somerset County Patriots, a minor league baseball team, would operate the ballpark. "The Make-A-Wish Foundation is all about making dreams come true," says Kalafer, who owns 31 automobile franchises in three locations - Flemington, Clinton, and Princeton, where he has the Ford and Land Rover dealerships. A cancer survivor, he frequently councils newly diagnosed cancer patients and volunteers for charitable events.
Morris, CEO of the 13-year-old Piscataway-based Edgewood Properties, has developed numerous commercial and residential projects including Brandywine Estates in East Windsor, Treetops in Monroe, Fulton Village in New Brunswick, and Monroe Plaza.
"Philadelphia-based RHM Associates has been working on the design, and Greg Snyder, the CEO of Lennar Corporation (formerly US Homes), has volunteered to help move the project forward," says Paul Huegel, CEO of the foundation. "We fully expect that companies will come forth and offer in-kind services."
Last year the New Jersey chapter ranked fifth of 74 chapters nationally, based on number of children served. Based on its $5 million budget, it ranked sixth. The foundation has encouraged more than 4,100 seriously ill children over the last 22 years.
It will consolidate offices in Union and Cherry Hill at the new location, just off New Jersey Turnpike Exit 8. Built to look like a castle, the new building "will serve as a beacon of hope for seriously ill children coming to Make-A-Wish to have their fondest wish come true," says Huegel.
"Our goal was to consolidate both offices into one building and make it extra special so we could bring kids into the building," says Huegel, describing the part of the building to be called the Wishing Place. "Historically, we have visited children in their homes or the hospital, but we are finding that not every child understands what we are offering them. We get responses like, 'I want a pair of sneakers,' or 'an air conditioner.' We want to show them what we are offering - that they can meet anyone or go anywhere, because other kids have done it." The building will also have an area for bereavement counseling, a children's garden, and a wishing well, plus space to train volunteers.
Groundbreaking for the $3 to $4 million building could be next year, but before that the township's Route 33 Land Development Task Force must issue a final report.
Huegel and Kalafer like to tell of the most unusual recent wish, made by a 14-year-old girl in Jersey City who was battling cancer and being teased about being bald. Her wish was to regain her self esteem. The foundation sent her to the Barbizon modeling school, bought her some clothes, and at her graduation she went down the runway and talked about the difference Make a Wish had made. A month later she was a featured speaker at the Make A Wish Foundation gala.
"The donation of this property is a reflection of our shared commitment to improving the lives of the foundation's special children, their families, and the entire community," says Kalafer.
For African College, A Princeton Tie
What do the Asian Business Council, worm composting, rowing, and an East African university have in common? Not much except they all, at one time or another, have been fortunate enough to receive the passionate attention of Tom Pyle.
Pyle currently serves as executive director of Strathmore University Foundation, a not-for-profit organization established to determine and develop academic linkages, program support, and funding opportunities in North America and Europe for Strathmore University in Nairobi, Kenya.
The son of Princeton University's former head of health services, Pyle went to Hotchkiss, majored in American history at Princeton (Class of 1976), and has a Harvard MBA. He has lived and traveled throughout Asia, first in China for the Carter administration, then in Seoul with Chase Manhattan, and later with Deutsche Bank in Hong Kong.
Upon returning to the states in 1993 with his Singapore-born wife, Molly, and children Tara and Adam, Pyle established the Asian Business Council of Princeton to provide a focus, forum, and network for Princeton-area business people with links to Asia. More recently, he served as director of development of the United States Rowing Association, the national governing board of the sport of rowing in the United States, and organizer and administrator of the United States Rowing Team.
In addition to the foundation, Pyle also serves as chairman of Trenton-based TerraCycle, an eco-friendly consumer products company started by Princeton University students in 2001, which uses earthworms (lots and lots of them) to transform municipal solid waste into organic liquid plant food.
Established in 1961 as a British-style, A-level college, Strathmore offers bachelor degrees in both commerce and business information technology to 610 degree candidates. Another 4,000 are candidates for certificates and diplomas in accountancy, information technology, administration and management, and research and corporate training. More than 65 percent of CPAs in Kenya are graduates of the university. Business administration and liberal arts degrees are to be added at a future date.
"I had coffee with a friend several years ago who brought this institution to my attention. I traveled there to check it out and take the measure of the place, and I was enormously impressed," says Pyle. "I've lived in many developing countries and have even worked on creating educational initiatives in several of them. But I saw many things that were very impressive. The university functions very well, the staff and the students are highly professional, and everyone's accountable."
Despite racial segregation in Kenya at the time of its founding, Strathmore began as Kenya's first racially integrated institution of higher learning. It continues as a pioneer in higher education as a leader in gender equality. Over 45 percent of its students are female, twice the national average and the highest percentage of any university in Kenya.
Understanding that United States residents typically hear only negative news out of Africa, Pyle realized that this was a story that needed to be told: "Here is an emerging organization that is producing positive results. This university is participating in nation building, and leadership development that will benefit all of East Africa, and that to me was very appealing."
While the university was founded by lay Catholic professionals in 1961, today it is a secular institution that mirrors the religious diversity of the country, which also includes Anglican, Protestant, Muslim, and Hindu worshippers.
"Faith is more caught, than taught, there," says Pyle. "There is a very high emphasis on professional competence. Whatever you do, you must do it to the best of your capability. Personal integrity there is very high, and that's hard to come by in East Africa, with all of the corruption. But, the school has managed to get it, keep it, and build on it. They walk the walk and that, too, appeals to me immensely."
"I have seen, and I work closely with, this university. What they do, how they behave, and what they stand for is very impressive," says Pyle. "Their values are trust, honor, integrity, and professional competence."
Because of his experience with developing countries, Pyle is quick to point out that with bad governance comes corruption, poverty, war, famine, and lack of capital.
"Kenya is the 17th poorest country in the world. The annual per capita income of 92 percent of the country is $70. Because of bad governance and corruption, there is not only a lack of capital, but of momentum. The last 24 years under the previous regime ran the country into the ground."
Pyle compares Kenya to Malaysia, which also won its independence in 1963. The two countries are similar in resources and populations, and both got off to a good start. In fact, Pyle claims, Kenya was much heralded in the beginning. But things "went squirrel-y" in Kenya in 1979, and, while Malaysia took off, the East African country flatlined.
"Here's the good news - it's not all pessimism and despair. Look at where Kenya is situated. It is surrounded by Somali, a rogue state; Ethiopia, which is racked with internal strife; war-stricken Sudan; Uganda, still recovering from Idi Amin, and Tanzania. That's a rough neighborhood. With more than 30 million people, Kenya is the most significant country in East Africa."
"It's located due south of Saudi Arabia, Syria, Kuwait, and Iraq," Pyle continues. "It's the first Christian country you encounter on the perimeter of that Middle Eastern neighborhood. Kenya is an extremely important country in the war on terror, because, as it goes, so goes the rest of East Africa. You may recall that Al Quaida bombed the embassy in Kenya a couple of years back, so we know they have an active cell in the country. And, where there is bad governance, Al Quaida has a better chance of getting a toehold."
"The bottom line is that through education, the United States has an opportunity to create a strong regional partner in Kenya that could help increase in-country stability and regional security."
"What we should be doing is transferring the economical model of institutional advancement and development, that we enjoy here, to Africa. Many skills are new to them, skills like establishing private organizations, networking with alumni and foundations to solicit funding, and reaching out to other individuals and organizations with an interest or stake in human capacity building in Africa.
"I've met with Strathmore alumni in Washington, D.C., Atlanta, and the Cayman Islands. In my mind, what the foundation is doing is planting seeds and cultivating the soil of a university that has a global reach."
Strathmore University Foundation, 20 Nassau Street, Suite 232, Princeton 08542. Thomas H. Pyle, executive director. 609-688-1022; fax, 609-688-1021. E-mail: email@example.com, Www.strathmorefoundation.org
Start-Ups: Video Maker
When Tom Pyle needed to tell the story of the Strathmore University Foundation, he turned to William "Billy" Ray, an NBC documentary editor and producer who opened a home business last year. The result is a CD that provokes and maintains viewer interest in the Kenya-based university. Pyle wrote and narrated the script, and Ray's company produced, shot, and edited the promotion piece.
"My background is in documentaries, and for families interested in true histories, I hope to do in-depth at-length stories with living members of the families," says Ray. He also does business-related documentaries, and for either type his prices start at $5,000.
The son of a salesman and a school teacher, Ray majored in drama at Creighton University in Nebraska, graduating in 1982, and he studied film at the New School in New York City. His wife, Jill, is a family law attorney, and they have three adolescent children.
Ray worked for the late Peter Jennings, then moved to NBC, where he is producer and/or editor for hour-long documentaries for Dateline, and also for news specials and Tom Brokaw specials. His Dateline piece on an American couple who adopted three pairs of twins will air in September.
"Because so much news is moving to entertainment," says Ray, "many stories that interest me don't get done. Several of my colleagues went into business at the same time so we bounce ideas off each other." He is looking for subjects. "Princeton is amazing for fascinating stories," says Ray.
Cineray, 65 Rollingmeade, Princeton 08540. William Ray, owner. 609-947-5622; fax, 609-924-3550.
Frank J. Cosentino, 71, on August 9. He had been president of Edward Marshall Boehm Inc.
Alice T. Canning, 71, on August 12. She founded Canning's Ideal Tile Co. at Route 1 Plaza. A memorial Mass will be Friday, August 19, at 10 a.m. at Queenship of Mary Roman Catholic Church, Dey Road, Plainsboro
Linda T. Goodman, 55, of injuries sustained in an August 13 automobile accident. She had worked as a financial analyst for IBM in Dayton. A service will be Thursday, August 18, at 7 p.m. at Six Mile Run Church, Franklin Park.