The Little Rock Technology Park Authority approved a resolution on Wednesday to negotiate with a consortium of local banks and close on a proposed $17.5 million financing package for the first phase of a planned $30 million downtown development.
The four tech park board members attending the meeting, led by Chairwoman Mary Good, gave approval for the Tech Park’s executive director Brent Birch and board member Dickson Flake to begin talks directly with a group of six local banks, led by Conway-based Centennial Bank.
The resolution comes about three weeks after the tech board issued a 67-page Request for Proposals (RFP) seeking bids to fund the much-talked about downtown development project to spur the city’s startup and tech community.
Flake, a local real estate developer, told the board members that the financing package will allow the publicly-financed authority to close a deal with Stephens Inc. for nearly 142,500 square feet of building space, or 3.25 acres, in the downtown area.
According to the RFP, the property includes the former Exchange Bank Building, located at the northeast corner of Capitol Avenue at Maine Street, which is leased to the State of Arkansas for a 15-year term expiring September 20, 2027. There are 78 parking spaces included in the state lease. In addition, the state leases 85 parking spaces on a yearly basis.
The location of the property is the north side of Capitol Avenue on both sides of Main Street with one additional parcel on the north side of Fourth Street. On the east side of Main Street, the site is bordered by Scott Street between Capitol Avenue and Fourth Street.
Once completed, the proposed tech park will include the to-be-assembled land area containing nearly 142,500 square feet of building space, or 3.25 acres, in the downtown area.
“It’s great to have that kind of community support, and it’s great that it is a collaborative effort,” Flake said of the banking alliance.
After the meeting, Birch said that the tech board only received bids from the local banking consortium in response to its July 19 RFP. Led by Centennial, the group also includes Simmons First National, Bear State Bank, Arvest Bank, First Security Bank, Arkansas Federal Credit Union and possibly other financial institutions to be determined at a later date.
Under the terms of the proposed deal, the financial consortium would provide necessary funding to begin Phase 1 of the downtown project at a fixed 4.19% interest rate over a period of six years.
The resolution by the board allows Birch and Flake flexibility to come to terms with the financial group in order to meet Stephen’s criteria that financing be fully in place by the end of next month.
“Our contract with Stephens stipulates that we show evidence of financing by September,” Flake reminded the board members.
Earlier in the day, in a presentation before the Downtown Little Rock Partnership (DLRP) board, Birch said that the tech board has deposited “a $6 million-plus check” check from the city following a request earlier this month to receive a portion of the 3/8-cents sales tax approved by citizens in 2012 to allocate some $22 million to develop the controversial tech park.
On Jan. 21, the Little Rock city board of directors unanimously approved to appropriate $6.8 million of the sales tax kitty to help finance part of the Stephens’ purchase.
Birch said the tech park authority hopes to close on the Stephens deal by the end of the year, and begin gutting the downtown buildings purchased for development by January. The tech park chief also said that the authority hopes to have its first corporate tenants by the summer of 2016.
“There has been a lot happening in a fast amount of time,” Birch said of the tech park’s recent deals.
In other tech park business, Birch said he and Flake are also currently developing another RFP for a construction manager for the downtown project that will essentially change the look of the city’s “Creative Corridor.” “We have been getting a good amount of interest and hope to being that process soon,” he said.