Major corporate action, healthcare industry expansion and the pace of home sales were some of the top Northwest Arkansas headline topics during 2016. Following are the top 10 business stories as determined by Talk Business & Politics and the Northwest Arkansas Business Journal.
• No. 1: Wal-Mart moves
The business world buzzes when Wal-Mart Stores makes headlines, and the retailer made plenty in 2016. Most notable was the company’s bolstering of its e-commerce operations by acquiring web retailer Jet.com Inc. for $3.3 billion.
In a September blog post announcing completion of the deal, Wal-Mart CEO Doug McMillon said the purchase builds on Wal-Mart’s strong e-commerce foundation and is intended to help accelerate growth. The deal was largely praised in the retail industry as a way for Walmart.com to boost its market share against Amazon.
As a result of the deal, Jet.com founder and CEO Marc Lore was added to Wal-Mart’s leadership team, serving as executive vice president at Wal-Mart and president and CEO of Walmart eCommerce in the U.S.
In other news, the company announced in April several changes that resulted in its board of directors shrinking from 15 to 12 members. Most notable was that Jim Walton, son of founders Helen and Sam Walton, would not seek re-election to the board. At the June shareholders meeting, Steuart Walton, one of Jim Walton’s three sons, was elected to the board.
• No. 2: Tyson transitions
Tom Hayes began 2016 as Tyson Foods’ chief commercial officer. Twelve months and two promotions later, he will soon be the global meat company’s new chief executive officer.
Hayes, who was promoted to president in June when the company divided the CEO and president roles, will take the reins as CEO on Jan. 1. He joined Tyson Foods in 2014 as a result of the company’s acquisition of The Hillshire Brands Co.
Current CEO Donnie Smith, 57, announced his retirement effective Dec. 31, though he will remain an adviser to the company and its board for three more years. Smith spent 36 years with Tyson Foods and was named CEO in 2009.
The transition at the top comes at a time when the company is facing multiple federal class action anti-trust lawsuits. Tyson Foods and 14 other competitors are accused of conspiring to keep broiler supplies low in 2008, 2011 and 2012 in order to drive up chicken prices. The suit was filed in the Northern District of Illinois.
Tyson Foods also established a $150 million venture capital fund in 2016 called Tyson New Ventures LLC. The Chicago-based fund’s first investment was a 5% stake announced in October with the startup Beyond Meat, a vegan food product company.
Tyson Foods ended its fiscal year with net income of $1.77 billion, a 45% jump over the previous fiscal year.
• No. 3: Healthcare happenings
It was a big fundraising year locally for Little Rock-based Arkansas Children’s Hospital, which is building a 37-acre hospital campus in Springdale. Numerous organizations made contributions to the effort, starting in May with an $8 million pledge from Wal-Mart Stores and its charitable arm, Walmart Foundation.
Numerous companies and individuals followed with seven-figure donations announced throughout the year, and Tyson Foods and the Tyson family pledged $15 million, the largest donation in ACH’s 104-year history.
The project is expected to cost approximately $428 million in construction, technology, equipment and operating expenses over the next five years. In August, ACH officials went public with a $70 million fundraising campaign to help support the project, and has secured about $56 million of that total.
Mercy Northwest Arkansas grabbed headlines in April, announcing it will invest $247 million to expand its services throughout Northwest Arkansas, highlighted by construction of a 279,000-square-foot patient tower west of the existing hospital on Interstate 49 in Rogers.
In January, Washington Regional Medical System announced a $19 million project to build a 66,000-square-foot healthcare facility. Other healthcare developments this year included the completion of a five-story, 132,800-square-foot Women and Infants Center at Washington Regional Medical Center.
• No. 4: Home-buying hotbed
A strong economy helped home prices skyrocket, and buyers lined up to purchase a home in Northwest Arkansas in record numbers in 2016.
According to data from Eric Harris, agent with Weichert Realtors Downum Group in Springdale, there were 8,933 home sales in Benton and Washington counties through the first 11 months this year. That’s up 16.2% from 7,683 unit sales in the first 11 months of 2015. The sales volume from January through November was a combined $1.91 billion in the two-county area. That’s up 33.5% from a sales volume of $1.43 billion through the first 11 months last year.
In fact, the residential activity in the first 11 months of 2016 has easily surpassed totals from all of 2015. Agents sold 8,382 homes last year in the two-county area, with a combined volume of $1.57 billion.
New home construction in Northwest Arkansas is also on a record pace. Residential permit value in the area’s four largest – Bentonville, Fayetteville, Rogers and Springdale – through the first 11 months this year totaled $417.65 million, up 16.4% from $358.79 million for the entire year in 2015.
• No. 5: Downtown development continues
Downtown neighborhoods continued to be a focus of development efforts in 2016, with Walton family groups funding many projects.
In Bentonville, the movement continued to spread beyond the square. With $15 million in Walton Family Foundation funding, NorthWest Arkansas Community College added to the city’s Market District by transforming a former Tyson Foods factory into a 28,000-square-foot facility for its culinary school, which will open in January and serve as anchor of the 8th Street Market.
Food and entertainment options have been at the forefront of development. For example, a Walton-owned company is building a $2.4 million, six-screen movie theater planned to open early 2017 in Bentonville’s Arts District, and TheatreSquared on Nov. 3 revealed plans for a new 50,000-square-foot venue on Dickson Street in Fayetteville.
In Springdale, construction is ongoing for a 44,000-square-foot Tyson Foods office downtown, and the Walton Foundation announced on Nov. 16 plans to help redevelop downtown Springdale’s municipal buildings by donating $3.3 million toward its design through its Northwest Arkansas Design Excellence program.
• No. 6: Stadium expansion
University of Arkansas officials unveiled plans in January for a $160 million expansion of Donald W. Reynolds Razorback Stadium in Fayetteville. The Board of Trustees approved the project in June by an 8-2 vote, but not without objections from board member and former U.S. Sen. David Pryor, who wrote to fellow board members the expansion plan “defies common sense.”
Just before the board’s June vote, five former UA board members — including Tyson Foods chairman John Tyson — also publicly opposed the expansion plan through a guest commentary that was published in the Arkansas Democrat-Gazette.
The expansion will increase capacity from 72,000 to 76,000 and is scheduled to be completed in time for the 2018 football season. The project will be funded entirely by athletic revenues, gifts and bond proceeds from a future $120 million bond issue, according to the UA’s preliminary financing plan. Bonds will be repaid over a 20-year period using athletic revenues generated from the stadium.
• No. 7: Walton Arts center re-opens
One significant development in downtown Fayetteville this year was the completion of a $23 million, two-year expansion and renovation project at the Walton Arts Center.
Walton Arts Center’s leadership said the renovation was sorely needed in order to meet the ever-expanding needs of traveling Broadway shows, which caused the center to make a wide array of adjustments, including using its black-box Starr Theater as storage. The city of Fayetteville rallied behind the effort in 2013 by approving $7 million worth of tax money toward the project, and the Walton Family Foundation, the Walmart Foundation and the Willard & Pat Walker Charitable Foundation were among the major donors that followed.
Arts and entertainment options are a major draw for prospective residents, and the Walton Arts Center in the 1990s set the stage for Dickson Street to become an entertainment hotspot, the center’s leadership said. Now, the newly renovated facility will pave the way for the future of the district.
• No. 8: Assisted living boom
There are 445 licensed beds among nine assisted living facilities in Benton County according to the Arkansas Department of Human Services’ Office of Long Term Care (OLTC).
In Rogers, there are five projects totaling nearly $80 million in construction either under construction or proposed that will add 526 new units to the inventory. Two of the projects are freestanding memory care facilities, the first developments in Benton County devoted solely to memory care. The other two properties will offer a full continuum of services for residents — independent living, assisted living and memory care.
Developers who spoke with the Northwest Arkansas Business Journal say they aren’t concerned about getting ahead of the demand curve, citing the growth of the NWA metro. In addition, of the new units, nearly 200 will be for memory care. In Arkansas, there are more than 54,000 people aged 65 and above who have Alzheimer’s, and that number is expected to increase by 24%, to 67,000 people, within the next decade.
• No. 9: Private and charter schools grow
In 2016, there was continued expansion of public charter schools in the region.
The Arkansas Board of Education in July approved a new Haas Hall Academy of Fayetteville campus at the Jones Center for Families in Springdale, and in October it approved an additional campus in downtown Rogers. Both campuses of the college-prep secondary school will open in August and could enroll up to 500 students apiece.
The historic Lane Hotel will house the Rogers campus, and it is owned by a Walton family entity. The Walton Family Foundation has advocated for charter schools nationwide. On a regional level, adding to the area’s educational offerings is named as one of its top initiatives.
Officials also revealed this year the name and location of a new independent school in Bentonville. Thaden School, backed by the Walton Foundation, will be built at the former Benton County Fairgrounds site near downtown Bentonville. The school is named in honor of Bentonville native Iris Louise McPhetridge Thaden (1905-1979), considered one of the greatest aviators of her time.
The school will open in the fall of 2017 starting with grades seven and nine and grow incrementally over the next four years to serve students in grades six through 12.
• No. 10: Interstate 49 changing
J.B. Hunt Transport Services, Metro Appliances & More and Sam’s Furniture have invested more than $45 million into new buildings along Interstate 49 while the corridor itself undergoes a $287.9 million reconstruction.
Lowell-based carrier J.B. Hunt is building a six-story, 133,000-square-foot office tower at its corporate headquarters. The $33 million project started in September 2015 and should be completed this spring.
Metro has invested $9 million into a 120,000-square-foot building on 6 acres northwest of I-49 and Arkansas Highway 264 in Lowell. Construction might be completed late this year or early 2017. In Springdale, Sam’s opened a 120,000-square-foot store this past spring. With a building permit valued at $2.08 million, C.R. Crawford Construction of Fayetteville built it.
Meanwhile, road crews have been widening nearly 26 miles of I-49 to six lanes, from Bentonville to Fayetteville. The $1.8 billion Connecting Arkansas Program, $1.3 billion Interstate Rehabilitation Program and revenue from the state gas tax are funding the projects of the Arkansas Highway and Transportation Department.
Other major road work underway includes the $100.62 million U.S. Highway 412 bypass project, which was the single-largest contract approved in the highway department’s 103-year history, and a $52.6 million Bella Vista bypass project.