SREG finds successful formula in South Yard, Drake Farms and more

Fayetteville-based Specialized Real Estate Group (SREG) expects to invest more than $1 billion over 15 years to develop Drake Farms, a 125-acre mixed-use residential and commercial neighborhood in north Fayetteville where homes, shops and amenities exist in close proximity.

The development builds on the lessons learned and the success of another major SREG project, South Yard in Fayetteville. That project is a 9-acre multifamily and commercial development in south Fayetteville. South Yard’s offerings include restaurants, The Meteor bike shop/cafe/wine shop, and the Moxy Hotel.

The current master plan for Drake Farms includes more than 2,000 multifamily units, 230 townhomes, 170 single-family homes, and well over 1 million square feet of commercial space. The latter will include medical, office, food and beverage, and a large hospitality component such as a hotel or event center. The neighborhood could be home to 5,000 people when fully developed, said Kaitlyn Fondano, SREG’s director of development. The size means it should include a variety of income levels.

“Really we envision it as a new neighborhood, a new community,” she said. “I think we have seen it as an opportunity to return to what we believe traditional neighborhoods or neighborhood living is meant to be. And so we have prioritized how we can connect that neighborhood in a way that life and work and neighbors come together, and they share time in our community spaces. They share time in our parks, in our trails, in our restaurants, in our tenants. And so we have focused on making a connected community.”

Restaurants are an important part of the equation. Fondano said diners are seeking experiences, not just a meal. She said SREG is looking for both local eateries and national establishments for Drake Farms.

“We favor really local concepts. But at the same time those need to be balanced with great operators, and great operators happen to be at a national level, and we’ve seen that at South Yard from the instance of Sweetgreen,” she said. “Obviously, they are not local, but they operate locally very, very well in that they take a lot of care and pride in the individual locations.”

The Drake Farms development is being built on mostly pastureland on what was a 160-acre plot. The land was formerly owned by Neal and Gina Pendergraft, whose house was the property’s only existing structure and will remain, with the Pendergrafts remaining as residents. Another property feature is an existing 8-acre grove of 100-year-old trees.

“It’s this connected way of returning to a real true neighborhood, and we just happen to have the opportunity to build one right in the middle of town,” Fondano said.

Drake Farms will be located directly across the street from Washington Regional Medical Center, which is expanding. Its first two phases are under construction, including a total of 152 apartments and townhomes in the first phase and 119 in the second. It also includes the neighborhood’s first commercial hub, under construction now, at the intersection of Gregg Avenue and Drake Street.

The hub will be composed of food, beverage and retail space in about 22,000 square feet on two levels. Shops will range from 1,200 to 5,000-plus square feet. SREG expects a few food and beverage concepts to provide anchor opportunities. It expects to build an additional 20,000-plus square feet of commercial space adjacent to it.

SREG has a health component to all its developments, and this is no exception. The Razorback Greenway trail network runs immediately east of the site, and the developers are having conversations with the city of Fayetteville about building spurs and trails. Fondano said the company focuses on the science of buildings as it relates to health, including indoor air quality. The neighborhood’s connected development benefits not only physical health but mental health as well.

“I think as we approach kind of the development of a neighborhood, it’s realizing that there’s different assets within that,” she said. “It’s the coffee shop on the corner; it’s the restaurant you go to; it’s the school; it’s the provider; it’s the retail; it’s the plant shop. It’s all of those spaces that create the meaningful neighborhood that we’re hoping to achieve there. And so the success of our tenants is as important as the success of our residential developments because we each need each other.”

Fondano said the company’s developments focus on densifying urban cores rather than building on the outskirts. Doing so leads to more connected living with proximity to places where people work, eat, travel, and send their children to school.

Drake Farms will be by far the largest investment for SREG, a real estate development and property management firm founded by Jeremy Hudson and co-founded by Seth Mims in 2010. SREG has developed more than 1.5 million square feet and 3,000 residential units across Northwest Arkansas.

Its other neighborhood-centric developments include the aforementioned South Yard. First Street Flats, immediately north of historic downtown Rogers, is smaller but follows the same concept. It features a multifamily development with a commercial space including the Ozark Charcuterie wine establishment, which will open in a few months.

Markham Hill, just west of Razorback Stadium, features residential development, a hotel, a restaurant and shared spaces. But none of those are nearly as big as Drake Farms is planned to be.

“I think it’s big not only for Specialized, but really for Fayetteville and really Northwest Arkansas,” Fondano said. “It is at a scale that few projects have been able to come near in regards to just the density of that development and really the significance of the type of neighborhood that we’re able to develop at that scale.”