Dormant for Years, Sleeping Subs Show Signs of Recovery

Frozen in time, stuck in court, bank owned, or stranded without full utilities, nearly two dozen subdivisions in Benton and Washington counties not only languished during the Great Recession, but sat dormant for years afterward.

Large and small, urban and rural, at least 22 subdivisions still do not have a single home. While many developments sprouted back to life with the return of consumer confidence, some, from Centerton to Goshen and points in between, are just now climbing out of the long shadow cast by the real estate collapse. Still others show no signs of renewal, and remain overgrown relics of a bygone era.

In terms of renewal, Fayetteville is seeing the most action. Five subdivisions have been replatted and renamed and are finally ready for construction. For places like Hughmount Village and Quarry Trace, all of this takes place a full decade after infrastructure was first installed.

Meanwhile, in Bentonville, the sprawling, 119-acre Providence Village still doesn’t have a sewer lift station and is owned by Chambers Bank of Danville. And in Goshen, the road to the 46-lot Brookstone Woods subdivision remains a road to nowhere.

Of the 383 subdivisions in Benton and Washington counties, 63 did not experience construction in 2014, according to the Center for Business and Economic Research at the University of Arkansas. Of the two-county total, only 22 subdivisions, or 5.7 percent, have always been vacant.

A few forces have to collide, or at least must exist, for an old subdivision to be unearthed, said Kathy Deck, executive director of the research center.

“There are a number of reasons a dormant subdivision might become active again — a few of those are significant price discounts to builders, increased marketing efforts, the financial wherewithal of the lender or developer, and idiosyncrasies of the owner’s position,” Deck said. “I do think that when you see new development activity in a location like Fayetteville then it could also be attractive for older projects to be reborn.”

 

Treetops and Rooftops

One of the developers reshaping the Fayetteville foreclosure scene is developer Bart Bauer. He has two subdivisions, The Treetops, and Abshier Heights, on the brink of construction.

He purchased both from banks, Treetops in 2014 and Abshier in 2012, for a combined $263,000.

He had both subdivisions replatted from multifamily to single family, and had the number of lots reduced.

Perched on a hill in southeast Fayetteville at the entrance to the Mount Sequoyah Woods Trail, Bauer said The Treetops, once named The Paddocks, had been dormant since 2009.

“It sat for years because I don’t think anyone had a good vision for this area,” he said. “It’s just so pretty. There’s got to be something that can go up here.”

Homes will be built by Treetops Development LLC, a partnership Bauer formed with Mark Rouse, who owns Rouse Custom Homes of Fort Smith. The partially pier-supported homes, inspired by Colorado lodges and designed by Fayetteville architect Kim Fugitt, will be about 2,400 SF and will cost as much as $135 per SF.

“You won’t see anything else like it in Arkansas,” Bauer said.

In contrast to the woodland environment of Treetops is Abshier Heights in the north-south parcel behind Ozark Natural Foods. Conceived as an urban subdivision, it will feature vertical homes with vaulted ceilings, rooftop terraces and stunning southward views.

The 2,158-SF homes are expected to sell for as much as $345,000. But for the price, Bauer said, the buyer gets luxury amenities and an excellent location.

“I don’t do hotdog and hamburger houses,” he said.

 

Holding On

Also in Fayetteville comes the long-awaited Hughmount Village subdivision. Located just north of the intersection of West Mount Comfort and Wheeler roads, Hughmount has been in the making for a decade.

Originally platted as Cherry Hills in 2005, the subdivision was troubled from the outset. One of the contractors installing infrastructure there went bankrupt, and by the time that got sorted out, the recession hit. The original partnership that developed the subdivision, Homestead Homes LLC, broke up.

Left holding the bag was Homestead partner Phil Phillips, who formed Hughmount Village LLC and held onto the property. According to Fayetteville planning records, in 2013 Phillips took another stab at the subdivision.

In the process of replatting, the following improvements had to be made: a turnaround for a firetruck; existing infrastructure retested; streetlights installed at Wheeler Road; and Hughmount Road widened from Mount Comfort to the subdivision.

Hughmount will have green space, a swimming pool and a playground. Houses must be at least 2,000 SF. A final plat was approved in January.

Phillips said 35 of the 128 lots have already been sold and that the future looks bright for Hughmount.

“I’m relieved,” he said. “There’s a market for the lots.”

Phillips, owner of Phillips Litho for 26 years, is not a developer. In conceding as much, he said a few mistakes were made along the way. Despite the setbacks, the property never went through foreclosure and now, the subdivision is finally ready for construction.

“I’ve had a lot of help hanging onto the property,” Phillips said.

 

Legacy Lives

South of Tontitown, off Harmon Road, the Legacy Estates subdivision was recently purchased for $725,000 by Eagle Creek Holdings LLC. Real estate broker Keith Marrs of Legend Realty, who partnered with Ryan Russell to form Eagle Creek, said the Legacy subdivision was just too good to pass up.

With 110 buildable lots, Eagle Creek bought the property, fully fitted with infrastructure, for $215,000 less than the original developer, Gary Brandon, paid for it when it was raw land.

“We got a great deal on it,” Marrs said.

Utilities are in the process of being permitted, which could take as long as two months. During that time, Marrs said he will look to sell, and might already have two potential buyers.

“This is turnkey,” Marrs said. “It’s ready to go.”

If the property doesn’t sell, no problem.

“We’ll build it out,” Marrs said.

While Legacy appears to be undergoing a rebirth, the same cannot be said of other subdivisions in the region. Saddle Brook at Valley View in Farmington is still tied up in a nasty lawsuit in Washington County Circuit Court. The 132-lot subdivision was platted in 2009.

In Benton County, the 143-lot Sienna at Cooper’s Farm Phase III, platted 10 years ago, remains vacant, as does Braemar in Centerton, platted in 2006. 

While not making specific reference to any one subdivision, Deck did say some developments might not ever see the light of day.

“It is certainly possible that these projects will not be viable in any reasonable time frame, but that adds up to a nonperforming asset for the owner/lender,” she said.