City offices, use of former Bost building discussed at Fort Smith Board meeting

A plan is moving forward for the Fort Smith Central Business Improvement District (CBID) to buy the building now used for city offices, but Fort Smith City Directors aren’t sure about the future of a former Bost training and education building.

CBID commissioners on Tuesday (Sept. 24) approved a resolution allowing CBID Chairman Bill Hanna to negotiate a lease agreement with the City of Fort Smith for the city offices at 623 Garrison Ave., in downtown Fort Smith. The resolution was approved during a special meeting Tuesday afternoon before the Fort Smith Board of Directors study session. The resolution and a draft agreement was then presented to the board at the study session.

The resolution gives the CBID authority to negotiate the purchase of city hall, the loan with a bank and a lease-to-own agreement with the city. Fort Smith-based Southland Management Group owns the building. The building was appraised at $3.98 million earlier this year. According to Deputy City Administrator Jeff Dingman, it was last purchased for approximately $3 million.

CBID commissioners stated during their special meeting that the lease would be the cost of the loan principal and interest and perhaps an additional fee and would be for five years, renewable for additional five-year terms until the loan is paid in full, at which time the city can purchase the building. The city can pay out the loan and purchase the building at any time with no prepayment penalty, the trustees agreed. The CBID would not be responsible for any improvements to the building.

The city has leased office space in the Stephens Building at 623 Garrison Ave. since the1970’s. The building at 623 Garrison has about 60,000 square feet of usable space, Dingman said in a memo on the subject. The city uses approximately 34,000 square feet of the building for city offices.

The Fort Smith Board in March approved an option for a five-year lease of the space, with rent at $33,500 per month – $1,000 more than the rent charged in the lease that expired Feb. 29 for this year – and $34,500 a month in 2025. Rent will go up $1,000 a month each year through 2028. City Administrator Carl Geffken said this is the same increase in rent the city has paid annually in the past.

The city occupies all of the third, fourth, and fifth floors of the building along with office space and a vault on the first floor and the breakroom and bathrooms on the second floor. There is more space available on the first floor and the second floor and the entire sixth floor in the building.

There is vacant office space on the first, second and sixth floors as well as the basement that could be immediately usable for the city staff to expand without renovation, Dingman said in the memo.

“What we are trying to do is keep the city downtown and offer a reasonable option to not looking at moving somewhere else,” Hanna told members of the board of directors Tuesday.

Director Lavon Morton suggested the city consider purchasing the building, at the cost of $4 million, which is what the current negotiation with the CBID is. Director Jarred Rego said the first decision the board needs to make is whether the majority of the board wants to keep city hall downtown. Mayor George McGill suggested the board at a later date have a session to discuss a city hall.

The board agreed to put an item on the agenda for the next regular session meeting to discuss whether or not the board wants to stay downtown or consider other options.

BOST BUILDING PLAN
The city also discussed the use of property and a building at 1801 S. 74th St., formerly used by Bost, at the Tuesday study session. The building is about 15,000 square feet in size.

In 1966, the city deeded a portion of city-owned property to Bost School for Limited Children,
Inc. to build a facility for the training and education of limited persons. The deed contained a
provision that should Bost cease to operate such a facility, property ownership is to revert to the city. The Board of Directors approved accepting the reversion of ownership on March 26.

Bost closed their facility and vacated the premises as of the end of May 2024 and the city filed a reversion deed to once again show that the city is the owner of the property.

Methodist Village, who’s property adjoins this property to the east, wants to use the two existing buildings on the property as a daycare facility that they would operate. Methodist Village has had their contractor evaluate the building to understand what upgrades or improvements they might need.

The construction and layout of the building, as it was built as a school for small children, is well suited to serve as a daycare facility, said Melissa Curry, Methodist Village CEO. There are not enough childcare facilities in Fort Smith, Curry told the board Tuesday.

“When we see a need, we try to do something about it,” Curry said, noting that the facility would help the city in numerous ways.

They anticipate they could serve as many as 150 children, Dingman said in a memo. Methodist Village is willing to invest about $1 million back into the building for cosmetic and other needs. They said they would request the city to invest approximately $458,000 for plumbing and other infrastructure needs. Methodist Village would maintain the property and carry insurance on it.

Curry said the cost for services would be reasonable and the venture would not for profit. Up to two-thirds of the spots for children would be offered to Methodist Village employees and another partner organization. The remaining spots would be open to the public. Curry said they would like to have the building ready to open by August 2025.

BlueSprig Pediatrics, Inc. also has inquired about the building with a local Realtor. BlueSprig specializes in therapies for children, especially ABA services for autistic children. The services they provide would be similar to services provided by the former occupant of the facility.

Dingman said city staff has evaluated the building for any city-specific use, but the park setting near residential areas preclude any uses the city might need, and the facility should be used in better service to the community.

Director Christina Catsavis raised the idea of using the building for an animal shelter earlier in the year. Director André Good said he did not believe that would be the best use for the building, but the board did ask City Administrator Carl Geffken to gather an estimate of what it would take to turn the building into a shelter. Director Kevin Settle said there also should be consideration of it being used as a school or a community center. Director Neal Martin said he would advocate selling the building.