Published On: Mon, Jun 28th, 2021

How the Buc-ee’s partnership shapes the Exit 407 project

 

By JONAH LOSSIAH

One Feather Staff

 

Bu-cee’s, a chain of travel centers and gas stations, has officially engaged in a partnership with the Eastern Band of Cherokee Indians.

On Tuesday, June 22, a press release was distributed with this landmark announcement. The Houston-based franchise will retain its claim of having the largest convenience store in the world, only now that store will be in Sevier County, Tennessee. The 74,000-square-foot facility was the first partnership at the development on the Exit 407 property. Kituwah, LLC purchased the 200-acre parcel for $13.5 million in 2019, and Buc-ee’s portion encompasses about 30 acres of that land.

“We’ve been working with them to get all of their variances, their permits and all of that for about six months. We actually had our first discussion with them prior to the beginning of COVID. So, that would’ve been, I want to say in February,” said Mark Hubble, chief executive officer of the Kituwah, LLC.

Hubble said that this is beginning of a busy year for the 407 project. He said that it was important that the first tenant was home run, and they are extremely confident about negotiations with other tenants moving forward.

“That was the initial strategy here. When you’re building one of these larger developments, getting someone who wants to be first … and can be a minimal viable experience and a profitable experience on their own is the most important part of the concept. Then we can go to the second stage, what is the next best experience as you start to develop out the property.”

According to Hubble, OE Experiences has been one of the major partners for the Tribe in developing this site. CEO Matthew Cross said this is a fantastic accomplishment for the project. He stated that while there is a lot of work to do, Buc-ee’s is exactly who everyone had their eyes on, and he is ecstatic that the deal is over the line.

“Our intent with Kituwah [LLC] was to use this property to bring in best-in-class operators. Buc-ee’s is the best-in-class operator within this space. They’re not just the largest, they’re also the best. They take care of their employees, they pay very well, they train well. They take a lot of pride in their brand. They have a lot of custom products. They adapt to the market that they go  in to,” said Cross.

He also said that this deal came at an opportune time. Cross stated that Buc-ee’s recently was closing in on new locations in North Carolina and Florida, but negotiations broke down in both cases. He said that he suspects this played a part in why the final announcement took so long to release. Despite those dealings, Cross said that he was extremely confident that they could haul in this deal.

“From the beginning, this site was perfect for Buc-ee’s. It’s 12 million people now, we expected 20 million people within a decade. It’s the most trafficked intersection within the state. This is, in my opinion, one of the greatest tourism markets in the country, because it’s very affordable; it’s high quality; and it’s trending upwards,” said Cross.

“They had been looking in this area for a long time. They’d actually looked at this site prior to the Tribe even purchasing this land. But the banks that owned it were not willing to divide ‘Dumpling Creek’, as it was called then, into subcomponents. They wanted to sell all 200 acres at once. Buc-ee’s just couldn’t make that happen.”

According to Hubble, knowing the level of interest Buc-ee’s had in this area made the Kituwah, LLC go the extra mile when it came to accommodating for the deal. Hubble said that the working relationship has been growing quickly.

“All of our dealings with Buc-ee’s have been mostly at a partnership level through the intermediaries that they use. We’ve been able to help them navigate some of the local landscape and the local regulatory environment. The power of their brand has helped us to push some things that can often take a long time, to get those projects through. So, we’ve really worked with them in a partner capacity. To be honest, they have been truly exceptional to work with,” said Hubble.

Both Hubble and Cross agreed that landing a brand like Buc-ee’s significantly assists the project moving forward. They stated that the most important aspect of finding tenants now is matching companies that share the vision of the entire project.

“Any time you get key tenants with such strong brand recognition and strong performance metrics, it helps the entire property and raises the value of the entire property,” said Hubble.

Hubble said that the Exit 407 project is being planned in three phases. Phase 1 now has momentum, and Hubble says they are looking to finalize the remaining tenants for the first 60-acre portion of this project. He said that each phase will incorporate about a 60-acre piece of the buildable land, with all the construction for each stage coordinated for a simultaneous opening. There are other deals already in the works that they hope to pin down soon.

Hubble indicated that there could be a deal in the works for a hotel on the property. “We’re looking at several potential projects there. Almost certainly a hotel will go on the property. Whether that’s part of a hotel resort, with a partner that we cannot disclose at this point, or as part of a branded hotel. That we don’t know, but we will certainly see a hotel or a hotel resort concept to be near that area.”.

The hope is to start construction as soon as possible. Currently, Buc-ee’s is planning on opening this travel center in September of 2022. In order for all of Phase 1 to be complete by then, there will most likely be a rush of announcements coming in the next few months.

“The main goal of this summer is to continue to make a few announcements that tell the market and tell other potential tenants what this property is going to be and who’s going to be operating here from the beginning. That will help finalize the rest of the partnerships that will be part of Phase One. Then it becomes a question of starting the construction of all of those buildings and facilities that will support those businesses. Our intent and our goal is to have a pretty flashy summer,” said Matthew Cross.

print