Wal-Mart Buys Superior; Boosts Occupancy Rates

Wal-Mart Stores Inc. purchased the 375,000-SF Superior Building in Bentonville for $29.9 million on Sept. 16, to serve as the new headquarters for its Sam’s Club division and around 1,000 of its associates.

Wal-Mart bought the building from developers Burt Hanna, owner of Hanna’s Candles and Greenland Composites, and David Slone, owner of Superior Auto Group in Springdale.

Hanna and Slone received $22 million in financing from Arvest Bank-Fayetteville in 2006 to construct the building.

The purchase nearly halved the 21.9 percent vacancy rate for office space in Bentonville reported in the second quarter Skyline Report prepared for Arvest Bank by the Center for Business and Economic Research at the University of Arkansas.

According to the second quarter report, Bentonville had 780,416 SF available out of a little more than 3.5 million SF of office space.

Around 335,000 SF of the Superior Building was leaseable, and deducting that number from the vacant and total existing space yields a vacancy rate closer to 13.7 percent. The building represented about 40 percent of the total vacant space on the market.

Approximately 19,000 SF of space is now occupied at the Superior Building, according to leasing agent Butch Gurganus of Collier’s International.

“It’s great for the market,” Gurganus said.

Ramsay Ball of Collier’s called it a “win-win-win.”

“It’s good for the owners, it’s good for Wal-Mart and it’s good for the market,” Ball said. “It will create a healthier market. An unstable market is not good for tenants or landlords.”

Sam’s Club has often been discussed on Wall Street as a possible spin-off opportunity for Wal-Mart, a possibility the Bentonville retailer has acknowledged was discussed and later dismissed during 2007.

In August, Wal-Mart reported same-store sales growth of 2.8 percent at Wal-Mart stores and 4.2 percent at Sam’s Club members-only warehouses.

In 2008, Sam’s Club represented $44.6 billion of the retailer’s $375 billion in revenue, a net increase of 6.7 percent with same-store growth of 4.9 percent. There are 593 Sam’s Clubs in the U.S.