Posted 12/19/2012 10:23 am
Updated 1 year ago
Preliminary paperwork approved Tuesday paved the way for Marriott to replace Peabody on the downtown Little Rock skyline.
The letter of intent (PDF) sets the stage for Fairwood Capital LLC of Memphis to purchase the Peabody Little Rock hotel lease from BG Excelsior Ltd., led by Marty Belz.
Davidson Hotels and Resorts of Atlanta will manage the 414-room high-rise for Fairwood, which intends to invest an estimated $16 million to remodel and upgrade the property at 200 W. Markham St.
BG Excelsior, an affiliate of Peabody Hotel Group of Memphis, currently pays gross annual rent of $375,000. In recognition of Fairwood's investment, the new annual lease would begin at $85,000 and escalate yearly.
The proposed 40-year lease agreement between the city and Fairwood was approved yesterday in succession by the Little Rock Advertising and Promotion Commission and the Little Rock Board of Directors.
The project is financed with a $28 million funding agreement with Arkansas Teacher Retirement System, the state's largest pension fund. In April 2009, the maturity of the original September 2000 loan between BG Excelsior and ATRS was extended to 2024.
Gretchen Hall, president and CEO of the Little Rock Convention & Visitors Bureau, said a lease document should be executed early in January and a timeline for the ownership transition should be clearer at that time.
"We don't have a definitive timing schedule yet," Hall said. "They're hoping to move as quickly as possible, early first quarter of this year."