Posted 3/12/2012 12:00 am
Updated 2 years ago
Led by Bill Schwyhart, Charles Reaves and Gary Brandon, the groups were overwhelmed by a whirlpool of debt, unable to generate enough cash to break free of the downward spiral. Joe Whisenhunt understands their plight.
"The thing that kills development is debt," said Whisenhunt, CEO of his namesake firm. "It forces developers into difficult situations to protect their financial position."
First to succumb was Charles Reaves, who made a name for himself with the Shadow Valley residential project before rolling out the Pleasant Crossing commercial development in Rogers.
The undeveloped pieces of the Pleasant Crossing project, which extends southward into Lowell, were deeded back to the bank in lieu of foreclosure in 2010.
Competitive pressure from the Pinnacle Hills Promenade development, one interstate exit north of Pleasant Crossing, is identified as a leading factor in his leveraged difficulties.
Next to fall in 2011 was Fayetteville developer Gary Brandon and The Grove project, which didn't really get untracked before the Benton County real estate market ground to halt.
The project's lone sale was a 1.6-acre parcel purchased for $981,000 in January 2008 by Harold Crye as a future office site for his Crye-Leike Realtors.
The last player swamped by debt was Bill Schwyhart. The District at Pinnacle Hills project was caught up in the flagging fortunes of Schwyhart and partner Robert Thornton after they parted ways in 2007 with their former Pinnacle Group partners, Johnelle Hunt and Tim Graham.
Schwyhart and Thornton managed to strike one deal on their property in September 2008 before commercial activity all but evaporated, selling a nearly 5.4-acre parcel to Wal-Mart Stores Inc. of Bentonville.
The story behind the $3 million sale to the world's largest retailer gained legendary status in northwest Arkansas real estate circles.
Schwyhart's pitch: When your executives leave their Pinnacle Hills homes, do you want the first thing they see to be a competitor's store?
At the time, Harps Food Stores Inc. of Springdale was looking to develop a grocery store on property owned by Hunt and Graham, outside the gated Pinnacle Hills entryway.
Schwyhart persuaded Wal-Mart officials to buy land across the street from the would-be Harps site that he and Thornton owned. The transaction is said to be the quickest site acquisition ever consummated by Wal-Mart.
The Harp's deal never happened. But Wal-Mart did develop a Neighborhood Market store at 5000 Pauline Whitaker Parkway, surely one of the company's nicest.