Convention Center competition discussed as Keller Convention Center project takes shape

The sight of jackhammers may be a common scene early next year in Jonesboro as a second convention center project is hopefully in its construction phase, a developer for the project said Wednesday (Dec. 9).

Gary Harpole with Halsey Thrasher Harpole said the contract for the 42-acre plot of land near U.S. 63, where a 152-room Hyatt Place Hotel and Convention Center will be built, should be secured in two to four weeks. Officials with Keller Enterprises, an Illinois-based company, announced plans to build the convention center on the former Arkansas Services Center near the Arkansas State Police headquarters. Officials with Keller Enterprises were out of the office Wednesday and could not be reached for comment.

However, Harpole said there has been delays related in part to pre-construction work that had to be done first. Before construction could begin, a three-foot below ground area around the 40 acres had to be cleared in order to completely level the ground, Harpole said.

As work began to level the ground, several concrete slabs – ranging from three to four feet wide by 10 to 12 feet deep in size – from the old buildings were found underneath the ground. Each of the slabs were removed to clear the ground, Harpole said.

NEXT STEP
A plat, or a scaled map, of the proposed convention center was filed Tuesday with Jonesboro and Craighead County officials. The map shows that the 42 acres is divided into five separate lots, with the largest lot being around 10 acres.

According to property records at the Craighead County Courthouse, the land is owned by Centerline, LLC which has ties to Jerry Halsey Jr. (one of the principals in Halsey Thrasher Harpole). Harpole said once the property is sold, Keller can begin requesting permits from the city of Jonesboro to start building.

The land is already zoned C-3 for commercial use, Harpole said, noting any zoning issues would be addressed in a site plan presented to the Metropolitan Area Planning Commission or approved administratively by the office.

If everything is completed, construction could begin in early January and take between 16 and 18 months to complete, Harpole said.

As for an economic impact, Harpole said the project and a similar one under consideration at the Arkansas State University campus will provide real dividends.

“Using the RIMS II analysis model, it was determined that this project with one hotel and convention center would create 467 construction phase and 227 permanent operational jobs, generating some $12 million in first year revenues,” Harpole said. “These projections are supported by earlier estimations that a hotel/convention center project would generate some $1 million dollars in local sales & use tax as well as upwards of $250,000 per year in local Advertising and Promotion taxes back into the local economy. The second hotel that is now also on the table under consideration for immediate construction for this site will create an estimated 325 construction phase jobs and an additional 83 permanent jobs while generating another $4.4 million in first year revenues, as well as generating additional sales and A&P Taxes.”

Harpole said his group used information based on the Regional Input-Output Modeling System, a system from the federal Bureau of Economic Analysis that economic development officials use to determine the economic impact of a project or a disaster.

COMPETITION
The Keller project is one of two proposed convention centers to be built in Jonesboro.

Springfield, Mo.-based developer Tim O’Reilly plans to build a 200-room Embassy Suites, a 40,000-square-foot conference room and a Houlihan’s restaurant at the former ASU track and field complex in Jonesboro.

In addition, ASU will create a hotel management and hospitality program to train students for that field. O’Reilly said in a Dec. 2 letter that he plans to request funding from the Jonesboro Advertising and Promotions Commission to help market the conference center as well as other hotels in the area.

As for the Keller project, Harpole said a decision on whether Keller would seek the same funding would be up to Keller.

“It is a decision for Keller but I anticipate it,” Harpole said, noting the tax was created in the 1970s to help promote tourism and hospitality. “Whether one or two are to be built, I’d anticipate anyone to do it.”

As for whether the market can support two convention centers, Harpole said it is possible.

“It is a vibrant market and we were very bullish on Jonesboro,” Harpole said. “If a market could support two, Jonesboro could. But it is tough to say.”

Earlier this year, O’Reilly said it could be a “one or the other” scenario.

“I honestly do not believe that the market can support two large convention/conference centers being built at the same time. The fact is that one or both of the facilities are not going to be successful. However, we are proceeding with our project and I like our chances based on the power of the Hilton/Embassy Suites and Houlihans brands, as well as the combination of our development, operations, sales and marketing teams, the Jonesboro Chamber, and the substantial support that Arkansas State University can provide,” O’Reilly said. “We have a few details to work out with ASU and some other stakeholders, but we can definitely deliver the financing, investment, Hilton Embassy Suites flag and Houlihans franchise to make this project a reality.”

Craighead County Treasurer Terry McNatt, whose office tracks sales tax revenues and economic growth in Craighead County, said Wednesday that the two convention center plan is feasible. McNatt said both sides have put their best foot forward in pushing for their plans.

“They have definitely done their homework,” McNatt said. “It may be a lesson for all of us on sustainability.”

McNatt, who has also worked in real estate and farming, said it is not known how the convention centers would impact other hotels, other businesses and real estate could flourish.

“The new restaurants are packed every night,” McNatt said of the restaurants on Red Wolf Boulevard. “There are also two new movie theaters (under plans). Plus, people are more apt to come here for meetings instead of going to Little Rock, Hot Springs and Fort Smith.”