Posted 10/21/2013 12:00 am
The financial travails of the man who was Jonesboro’s leading commercial developer are contributing to the mix of office and retail activity in the city.
Two high-profile properties associated with Bruce Burrow have exited his Chapter 11 bankruptcy case in tandem transactions totaling $9.4 million. A third project, the Citizens Bank Building in downtown Jonesboro, is in play.
An 11-acre piece of the former Indian Mall development recently sold for $6 million to pare Burrow’s debts. The site at the southwest corner of Caraway Road and Wilkins Avenue will become home to a Kroger Marketplace.
The Indian Mall property helped secure about $10.3 million in debt held by Centennial Bank of Conway. Net proceeds from the sale to Kroger Ltd. I, an affiliate of the Cincinnati-based grocery chain, reduced the Centennial debt by nearly $5 million.
Caraland LLC, led by Burrow and Marty Belz of Memphis, bought the mall property for $10.3 million in October 2007. According to bankruptcy filings, Caraland still owns 19 acres.
Burrow originally had redevelopment plans that included “a major department store, several junior department stores, restaurants, extensive landscaping and potentially a multi-screen movie theater.”
The open-air, mixed-use retail center, dubbed Shoppes at CaraLand, didn’t happen.
The 378,000-SF Indian Mall, once the shopping mecca of northeast Arkansas, slid into ghost center status over the years as newer retail projects made the scene. Most of the mall was razed by Burrow, leaving the 80,000-SF Sears store at the south end of the property as the last vestige of the landmark project.
In addition to the Kroger Marketplace, plans call for the construction of new retail space to adjoin the north side of Sears. The addition could total about 25,000 SF.
A block west of the Sears store, the 52,000-SF MBC Plaza Building at 2400 Highland Drive was purchased for $3.4 million by a Little Rock investment group led by Stephen LaFrance Jr. and his brother, Jason.
The new ownership will invest additional dollars to redo the roof, spruce up the exterior, rebuild the parking lot and reconfigure the fourth and fifth floors.
The office project, which will be renamed the 2400 Building, was home to Burrow’s varied real estate enterprises, including MBC Holdings Worldwide.
MBC purchased its rechristened five-story, namesake building for $4.2 million in February 2008. Burrow holds a 50 percent stake in MBC.
Crowned with the Regions name today, the project originally was developed as the headquarters for Wallace Fowler’s First Bank group that operated under the Southwest Bancshares banner.
Under MBC ownership, the 3.3-acre office development bore a $4.8 million foreclosure judgment held by Little Rock’s Metropolitan National Bank and a $491,200 second mortgage claim held by First Community Bank of Batesville.
The property carried a paper value of more than $5.5 million in Burrow’s bankruptcy filing.
Burrow filed his petition for Chapter 11 reorganization on July 30, 2012, and listed total debts of $17.27 million and total assets of $14.1 million.
However, those tallies reflect only a fraction of the debts and assets he shared with Belz.
Absent from Burrow’s roster of Chapter 11 assets is his stake in the 37,500-SF Citizens Bank Building in downtown Jonesboro. Real estate records indicate the property is owned by MBC Holdings Worldwide.
A deal is in the works that could result in a mixed-use redevelopment of the Citizens Bank Building with apartments, retail and office space. Plans include construction of a neighboring parking garage to support the project.
“We do have a qualified buyer on the property,” said Gary Harpole, president and chief operating officer of Jonesboro’s Halsey Real Estate Inc., which is marketing the project.
The unnamed would-be buyer is about six months away from completing due diligence and tying up loose ends, according to Harpole.
Purchasing or restructuring the land leases associated with the property is among those loose ends.
The vacant seven-story project at 100 W. Washington Ave. was purchased for $1.7 million in November 2005 from the estate of renowned Arkansas banker Herbert McAdams.
McAdams retained ownership of the building after selling Citizens Bank to Boatmen’s Bancshares Corp. of St. Louis in a 1995 stock swap valued at $42 million.