In Separate Deals, Marquee High-Rises Change Hands
Two of Fayetteville’s tallest buildings — one primarily residential and the other an office building — changed ownership recently in separate seven-figure deals that closed in a span of five days.
On Sept. 9, a deal closed to transfer ownership of the Legacy Building at 401 W. Watson St. for $3.2 million.
On Sept. 13, the E.J. Ball Building at 112 W. Center St. officially sold for $3.12 million.
Both properties are seven stories tall.
Conway businessmen Todd Ross and Chris Crain and former developer Mitchell Massey of Fayetteville paid $3.2 million for the Legacy Building, a 38-unit, luxury condominium building which sits just a block to the west of the Dickson Street entertainment district.
The property includes 13 luxury condos that remain empty and unsold. The purchase also includes the building’s second floor, an approximately 8,000 SF space, which is built out but not finished.
Danville-based lender Chambers Bank provided financing with a $2.72 million mortgage.
Ross is president and CEO of Preferred Medical, a customer-focused, service-oriented medical supply company in Conway.
Crain is president of Crain Automotive Holdings of Sherwood, which has numerous franchised dealerships throughout the state. He is the son of company owner Larry Crain Sr.
Ross said the improved health of the local real estate market made the purchase an attractive proposition. He noted the redevelopment activity taking place on Dickson Street, specifically the $22 million renovation and expansion of Walton Arts Center, and the recent addition of popular Fayetteville-based restaurant JJ’s Bar & Grill in the former Jose’s property, just a stone’s throw from the Legacy’s front door.
Ross and Crain also own residential units in The Dickson, a nine-story, mixed-use building at 609 W. Dickson St., and are frequent visitors to the area.
“We have watched the area develop, and we believe there is a nice resurgence going on in Fayetteville and Northwest Arkansas,” Ross said. “I’m not implying that it happened just last week, but there’s been a sustained uptick. We believe in what’s going on up there.”
Ross said of the 13 acquired units, five are currently under contract and one just recently sold.
“They are literally flying off the shelf, which is exciting for us,” he said.
The other condos in the building are independently owned and are not part of the acquisition. The Grillehouse Seafood & Steaks, a casual fine dining restaurant in the Legacy Building, is also not part of the sale. The 4,377-SF space and restaurant is owned by Clint Boutwell of Oxford, Mississippi.
As for the additional 8,000 SF, Ross is hopeful that it won’t take long to find a tenant for the space.
“If you look at everything that is going on in the area, we are very bullish on being able to find someone that is looking for some nice office space,” he said. “Whether that’s all 8,000 or splitting it up. We think we got in at the right time to have a really good product that the whole market will be excited about.”
The building had previously been owned since January 2013 by The Broe Group, a Denver-based private investment firm. The company took over the distressed asset when it paid $4.26 million to three other banks that helped Springdale lender Legacy National Bank fund the building’s $17 million construction — First National Bank of Fort Smith, First National Bank of Green Forest and Little Rock lender Metropolitan National Bank. (MNB was acquired by Simmons Bank of Pine Bluff in 2013).
The Legacy Building was built in 2007 and was a notable development of convicted developer Brandon Barber, who pleaded guilty in July 2013 to three charges — conspiracy to commit bank fraud, money laundering and conspiracy to commit bankruptcy fraud — and was sentenced in October 2014 to 65 months in federal prison.
CBRE Northwest Arkansas brokers Clinton Bennett and Sterling Hamilton worked cooperatively the past few months to market the property, which sold at auction to Legacy National Bank in November 2008 for $11.25 million. LNB also filed the initial foreclosure on the property in January that year.
E.J. Ball Building
The 57,972-SF structure, on Center Street and caddy-corner from the downtown square, is the tallest office building in Fayetteville. The purchase price equals $53.81 per SF.
Specialized Real Estate Group of Fayetteville and Moses Tucker Real Estate of Little Rock announced their joint acquisition of the property on Sept. 14, with an eye on “reinventing” the building. It has a current occupancy rate of about 60 percent, with tenants including Main Street Media, SCM Architects, TheatreSquared Inc., and the administrative offices of the Seven Hills Homeless Shelter.
According to real estate records filed at the Washington County Courthouse, Tower Square Fayetteville LLC (80 percent) and Bradford Square of Arkansas LLC (20 percent) are listed as tenants in common for the property.
Iberiabank in Bentonville provided a three-month, $2.4 million mortgage for the purchase, and the financing paperwork was signed by Christopher Moses (Tower Square) and Mark and Kimberly Dake (Bradford Square).
Moses is president and CEO of Moses Tucker. Mark Dake is a Little Rock orthodontist.
Jamie Moses, Moses Tucker’s director of development, said the project will add to the downtown square neighborhood.
“Redevelopment of the EJ Ball is the first significant project for Moses Tucker in Northwest Arkansas, and one that is aligned with our philosophy of building strong core cities,” Moses said.
Moses Tucker opened a second office earlier this year on Joyce Boulevard in Fayetteville’s Nelson’s Crossing development.
Fayetteville developer Ted Belden, the building’s owner since 2007, said he opted to sell the property to focus his resources on smaller, historical projects.
“This building wasn’t as attractive to keep long term and the timing was right for me,” Belden said.