Barber Group Plans Condos Off Dickson

The Barber Group Inc. has spent $1 million for a warehouse in Fayetteville. The next step? Tear it down and build $10 million worth of condominiums in its place.

The development company bought the 75-year old, 15,000-SF building at 401 Watson St. — a block north of Dickson Street — from Tom Pearson on Feb. 28.

They plan to raze the building, which housed Shulertown Marketplace a decade ago, to make way for a six-story, 75,000-SF project with 34 condominiums. The yet-to-be-named complex will also include a 4,100-SF restaurant, 56 self-contained parking spaces on the first floor and a recessed fifth-floor fitness center with access to a terrace area and hot tub.

The new owners hope to have it ready for occupancy by the time the Arkansas Razorbacks football team plays UCLA in the fall of 2006.

“It’s going to be affluent living in a fun environment,” said Seth Kaffka, president of The Barber Group.

Brandon Barber, chairman of The Barber Group, said the market is ready.

“We’ve got a very sophisticated market here that is begging for something like this, and it fits in with the Downtown Master Plan,” Barber said.

Robert Sharp of Fayetteville is the architect on the project, and The Barber Group plans to contract the construction of the project on its own.

The 34 balconied units will range from 900 to 2,700 SF in size with the penthouse units taking up the top two floors. Starting prices are hovering around $225,000.

The building will also have a property owner’s association.

“It’s all going to be completely secured, keyed-entry access. We just really wanted to add something there that is going to embrace the entertainment aspect of Dickson Street,” Kaffka said.

Fayetteville Mayor Dan Coody said he’s on board with the new building because it will generate even more traffic downtown.

“I couldn’t be more excited,” Coody said. “To bring something of this magnitude downtown is going to further solidify the strength of the Downtown Master Plan and bring new business and residential opportunity downtown and continue the high quality growth that Fayetteville wants to see.”

Barber said parking has been a selling point for the condos. He’s had people approach him interested in buying a unit for the parking privileges alone, he said.

The units will be for sale and the parking will be for lease.

“The majority of the people that are interested in it don’t even live here,” Barber said.

Barber said the building’s customer base is looking for a second home, whether they are Razorback parents or they just want a second place to stay on game weekends.

Kaffka said he’s spoken with at least 10 people who are seriously interested in a unit.

“I just got off the phone with a guy this morning who said as soon as you get going on the interior let me know because I want to customize my own unit,” Kaffka said

Their demographic research comes in the form of day-to-day business meetings, Barber said.

“In the people we deal with on a regular basis at the real estate agency or whatever, you just get so much interest and ‘hey this is the product I am looking for, I want to be downtown, I want something that is maintenance free,'” Kaffka said.

UARK Bowl investor John Nock has also been hired on as a consultant on the project.

Time Tells

Developer and investor Ted Belden said that based on his experience, there’s no reason why more upscale condos wouldn’t do well near Dickson.

Belden said he’s seen great market interest and satisfying sales in the projects he’s invested in downtown Fayetteville.

“They’ve marketed themselves really well,” he said.

Belden has invested in downtown projects including the renovated Inn at Carnall Hall, the Blair House and ongoing projects such as the Lafayette Lofts and West Dickson Development, an investment group including Rob Merry-Ship, Richard Alexander, John Nock and John Chambers, that plans to build a $25 million mixed use project on the block between University and Powerhouse avenues.

Belden said they’ve sold out the first 17-unit building at Lafayette Lofts and developers have pre-sold three of the six units available for sale at the top of the Bank of America Building. The BOA units will sell for $200 to $250 per SF and range from 1,800 to 2,500 SF. Alexander, Merry-Ship and Nock own the building.

There are also two condos available for sale in the UARK Bowl on Dickson Street, a 14-unit project that opened in 2002, which was developed by Belden, Alexander, Merry-Ship and Lamar Anderson, the owner of Hugo’s restaurant who died last year. One 1,300 SF unit is listed at about $185 per SF.

Iceberg Tips

But the Dickson Street project is just one of many in the works. The Barber Group has an estimated 1,500 residential lots in various stages of production, from finalizing a purchase on prepared lots to securing raw land to selling lots to investors or builders in Bentonville, Centerton, Rogers, Springdale and Fayetteville. It is involved in 15 to 20 subdivisions, Barber estimates, and has more than 100 acres of commercial property for development.

The Barber Group is in the planning stages for a mixed-use project off Joyce Boulevard in Fayetteville that also might include residential. Along with partner Collins Haynes and other investors, Barber Construction plans to start work in 2005 on Condos at the Peaks, a 33-acre upscale project in Rogers that will feature 260 units ranging from 1,800 to 3,500 SF and sell from $280 per SF.

“It’s proof that you really can do anything if you surround yourself with people that are much smarter, wiser and more knowledgeable,” Barber said. “We’ve put a team together that can build anything from a townhouse to a $10 million building.”

The Barber Group has hired two construction industry veterans in the last six months: Fred Sherman, formerly of Basic Construction Co. of Springdale, and Gary Boyles, formerly of DECCO Contractors Paving Inc. of Rogers.

The firm, which is less than two years old, offers single-family lot investments from $50,000 to $150,000 as well as multi-family products. The Barber Group also owns 50 percent of Dallas Real Estate Services Inc. of Fayetteville, which lists their projects.

Kaffka and Barber, who grew up together in Jonesboro and married sisters Laura and Keri Chambers, respectively, have backgrounds in banking. They both held previous positions with the Community Bank of North Arkansas, which is now known as Chambers Bank of North Arkansas.

Their father-in-law, John Ed Chambers III, is president and CEO of Chambers Bank Inc., which owns Chambers Bank of North Arkansas and Chambers Bank of Danville.

“Working at the bank, that was our MBA,” Barber said. “We were both fortunate enough to see how people make money and see how they don’t. Secondly, we got to see from being around our family how a deal is put together. The structure of a loan is very important to the success of a loan, whether they are going to go interest only for 18 months or put someone on payments.”

Barber said land acquisitions vary from buying raw land that will need extensive site work to batches of ready-to-build residential lots.

“Our investors are looking for opportunities across the board whether it be a town home or an office building. It’s a turnkey system. You can be as involved or not as involved as you want to be.”

Barber estimates the return on one of the firm’s investments is about 10 to 20 percent in the current market.

“We have the ability to go out and secure big pieces of land, our investors can come in and purchase the lots from us and build a house, and then they can get a return on their investment. In this market it’s pretty safe,” Kaffka said. “It’s an easy way for someone to come in and dabble in real estate.”

For example, a consumer can buy a lot from Barber Group, agree to a construction contract, the person will take out their own personal loan, and Barber Construction will build the home for them and sell it for them.

“We’re their vehicle to make money,” Kaffka said.

The firm’s investors vary, Barber said.

“We cater to the person that wants to build a house with us, all the way to a person who wants to invest in a multimillion-dollar project,” Barber said.

Kaffka said they’ve had investors start out with one home two years ago that are now building 10.

In an effort to diversify the branding of its products, The Barber Group has plans to form Homeworks Inc., a company that will focus on building homes that sell for less than $300,000. For example, The Barber Group will be building a 111-lot subdivision called Timber Trail in east Fayetteville that will offer affordable single-family housing units that will average 1,300 SF and sell from $120,000.

“We are concentrating on more upscale product because we feel like that is a niche that we are comfortable delving into that a lot of people aren’t,” Barber said. “But on the same token there is nothing wrong with duplex lots and affordable housing and we’ve got some very big projects.”