Farewell party, auction the final chapter for Powerhouse Seafood in Fayetteville

It’s all over but the auction for the long-running downtown Fayetteville restaurant Powerhouse Seafood & Grill — an auction and one last party.

On June 15, the restaurant’s Facebook page announced its closure with this brief statement:

“Powerhouse Seafood & Grill will be closing our doors at the end of this month. It’s been a good run and we appreciate all of our guests so much. COME GET A KILOWATT WHILE YOU STILL CAN.”

Jeff Caudle, the owner who steered Powerhouse’s course for the past 17 years, revealed that he arrived at that decision mutually with the building owner/landlord. Craig Underwood, president and majority owner of Underwoods Fine Jewelers in downtown Fayetteville, owns the restaurant building on North University Avenue, just off the Dickson Street entertainment district.

“I wanted to sell the restaurant and retire, and [Underwood] wants to go in a different direction,” Caudle said in a recent interview with the Northwest Arkansas Business Journal. “And that’s perfectly within his right to do so. I can’t say I blame him for that because if I had a piece of property and thought I could get three times the rent I was getting now, I would do the same thing. It was a mutual deal.

“It’s a shame the restaurant is closing [because] there are so many memories and history, and it’s a part of Fayetteville’s culture and tradition.”

When the restaurant’s history is recorded, it will say July 1 was the final day of operation, capping a three-decade run that started on Sept. 9, 1992.

Over the years, Powerhouse became synonymous with two main attractions: the famous Kilowatt, a frozen drink that delighted patrons, and the ever-popular “Party on the Patio,” featuring live music in the vibrant atmosphere behind the restaurant, limited to the warmer months.

“Kilowatts are served in 12- and 16-ounce portions, but they’re made by the bucket,” the Northwest Arkansas Democrat-Gazette reported in July 2014. “Four cans of pineapple juice, one gallon of orange juice, three bottles of house coconut rum, one bottle of Bacardi 151 rum, one gallon of water and hurricane mix go into this epic concoction.

“Maybe you ought to share.”

Caudle has a parting gift in store for the loyal patrons who supported the business. Despite the restaurant’s closure, Caudle has decided to host a final “Party on the Patio” in mid-July. Caudle said to watch the restaurant’s Facebook page for those dates.

“We won’t have any food because I won’t have any kitchen staff by then and hopefully no inventory,” he said in a recent interview. “But I will have a lot of liquor inventory I need to deplete.”

After that, Block Realty and Auction in Springdale will conduct an auction on July 22 at 10 a.m. to sell Powerhouse’s equipment, fixtures and other memorabilia.

Running a restaurant is no easy feat, as acknowledged by Underwood, who praised Caudle’s exceptional management over the years.

“A lot of people underestimate how hard it is to run a restaurant,” Underwood said. “Jeff [owned it] longer than anybody else and did a phenomenal job with it.”

THE EARLY DAYS
Powerhouse’s origins date back to a real estate investment by another Dickson Street business owner.

Bill Underwood, who founded Underwoods Fine Jewelers in 1957, bought the building at 112 N. University Ave. in October 1991 through a family-controlled business entity for $125,000. It previously was an operations center for Southwestern Electric Power Co. (SWEPCO) and the site of Fayetteville’s “mother” spring, where the first settlers got their water more than 180 years ago. The spring later provided steam for SWEPCO generators.

Underwood, who died earlier this year at 90 after a brief cancer battle, was active in civic affairs. In the 1980s, his son remembered his active participation in the committee responsible for selecting the site where the Walton Arts Center (WAC) would be constructed.

One of those sites was the former SWEPCO site.

“Being part of that site selection process, Dad knew SWEPCO was willing to part with the building for a price,” Underwood recalled. “A year or so later [after officials determined the WAC site at the corner of Dickson Street and North School Avenue], he approached them and said if they were still interested in selling, he’d like to buy it. So, the property never came on the market.”

Underwood explained that his father always thought the building would be a neat place for a restaurant. The feeling was mutual. Underwood said Stan Clark, the founder of the “jumpin’ little juke joint” Eskimo Joe’s in Stillwater, Okla., seriously discussed renovating the SWEPCO building for a Fayetteville Eskimo Joe’s with Underwood. There was also interest from Little Rock restaurant owners.

“We had several different people approach us about ways to use the building,” Underwood said.

But a group of family members and friends from Houston ultimately sparked Underwood’s interest and started Powerhouse.

OWNERSHIP HISTORY
The six Texans who operated the restaurant when it opened were:

• Jack Hignett (president) and his wife Chrissy (Biles) Hignett
• Rex Sirmons, Hignett’s lifelong best friend
• Hignett’s in-laws: Jim, Joe and Mary Biles

Underwood explained that the Hignett/Biles group was part of a larger business ownership structure that included family friends of the Underwoods.

“We helped them [Hignett/Biles group] put together a group of investors for the restaurant,” Underwood explained. “They were struggling to get the money together, but we had a lot of confidence in them because of their restaurant background and being a family unit moving up here. We liked what Jack and his crew were going to do.”

The restaurant’s initial investment group included multiple stockholder groups who combined for 376 ownership shares ($1,000 per share):

• Bill Underwood set up a family entity called Tagon Corp., which included Underwood and his three children — Craig, Michelle and Vicki. With 114 shares, Tagon was the restaurant’s largest stockholder.
• Hignett/Biles group: 107 shares.
• Lee Bodenhamer: 50 shares. Bodenhamer, an Arkansas Business Hall of Famer (2008) and philanthropist was Bill Underwood’s best friend in college at the University of Arkansas.
• Ron Loveless: 40 shares. Loveless was an early Walmart executive and the first CEO of Sam’s Club before retiring in 1986.
• David McClinton: 30 shares. McClinton was a highway contractor and later served as president of the McClinton-Anchor Division of APAC-Arkansas Inc.
• Bob Wheeler: 25 shares
• James Keenan: 10 shares. Keenan’s father and grandfather co-founded Pace Industries, an aluminum die-casting company in Fayetteville.

That ownership structure existed for seven years until its dissolving. “They [Hignett/Biles group] were ready to move on,” Underwood said.

Layne Caudle, a culinary-trained chef and Powerhouse employee, and Trish Heckathorn, his girlfriend, bought the upscale restaurant from Underwood in December 1999. Their ownership lasted seven years until 2006 when Caudle’s older brother entered the picture.

“[Heckathorn] wanted out of the restaurant, and my brother asked me if I would invest in it so he could buy her out,” Jeff Caudle explained. “My wife and I at the time both had full-time jobs and good income and thought that would be OK.

“So, we invested in it with one caveat — that we would never be involved in the restaurant.”

Caudle said that arrangement lasted about six months before he eventually became Powerhouse’s third owner. He said a deal was in place to sell the restaurant a few years ago. It was scheduled to close just as the COVID-19 pandemic arrived in the spring of 2020.

“Since COVID, the financial rewards have not been there, which contributed a lot to the decision to go ahead and retire and move on,” he said. “I don’t want to work until the day I die. I am retirement age. I’m gonna go to the beach.”

WHAT’S NEXT
Underwood reiterated that he’s not selling the 2.6-acre property and is working to secure its next restaurant or entertainment tenant.

“We’ve had many people approach us,” he said. “We’re open to any possibilities, but I think a restaurant is the most logical thing to go there.”

Commercial real estate firm Moses Tucker Partners in Bentonville is marketing the property for Underwood. The 7,800-square-foot building is offered at a lease rate of $30 per square foot.

Zack Kifer, a Moses Tucker principal, said the property’s location adjacent to the downtown Cultural Arts Corridor adds to the appeal and potential of the space. Through public-private partnerships, the city is developing 12 acres downtown, from Dickson Street and West Avenue to south Fayetteville. The public outdoor space is part of a 50-acre corridor, including private property and streets that link cultural institutions, such as the Walton Arts Center, Nadine Baum Studios and Fayetteville Public Library.

“I don’t know where else you can find an opportunity like this for an end user to come in and try to make a big splash,” Kifer said.

He said the success of Nashville-based restaurant and live music venue Tin Roof, which opened last year in downtown Fayetteville, should also further fuel excitement for the future of the nearby Powerhouse property. An investment group purchased the building at the corner of Dickson Street and West Avenue in 2018, renovated it and landed Tin Roof as its tenant. The building’s most recent occupants were Ozark Brewing Co. and Hog Haus Brewing Co.

“That’s part of the pitch to any group; ‘This group [Tin Roof] came in, they made the investment, and it’s worked tenfold.’ I can’t share their revenue numbers, but it’s super impressive. I expect them to be down there for a generation. We’re trying to find the next one.”