Shopping center owner West Group Real Estate is stepping into the sun with a deal for Seal Energy Solutions to install a solar array and battery storage system to power its offices at 5507 Ranch Drive in Little Rock.
The 93.5-kilowatt array, the first of several solar projects on the drawing board, will go up next fall with 267 photovoltaic panels generating 350 watts each, the companies said Friday.
West Group hopes to collaborate with Seal on other properties soon, principal broker and real estate manager Jill Bryant told Arkansas Business. West Group's offices are at Dogwood Crossing, one of several commercial developments owned and managed by the company.
The project takes advantage of financing incentives that helped entice West, which also owns the Bowman Station and Chenal Place developments in Little Rock and the Dogwood Landing project in Hot Springs.
"The initial investment was substantial due to the size of our roof and usage requirements," Bryant said. "The cost was over $180,000. However, with federal grants and direct tax credits, the net cost will be closer to $85,000."
Bryant expects to recoup that in about seven years using only cash savings from energy credits. "We fortunately did not have to finance the investment, which made the payback shorter," she said, predicting some $1,500-$2,000 in savings monthly. There's also "value to tenants and clients for the building using a responsible source of energy," Bryant said.
Seal Solutions, based in North Little Rock, said the Dogwood Crossing system will power West Group's offices, exterior lighting and signs. The real estate company, formed by three partners in 1993, even hopes to generate ample enough power to share credits with other properties to ease their electricity bills.
West Group manages some properties it doesn't wholly own, but that it is affiliated with through one or more of the firm's partners.
The financing deal includes a solar investment tax credit, depreciation incentives and a projected 12.5 percent internal rate of return over 30 years.
"The agreement we have with Entergy for energy credits is transferable to any owner in future," Bryant said. "If any additional energy credits are generated that we don't need, we can use them at other properties owned by West Group LLC."
The system has a 30-year warranty, she said, praising Seal for helping her in "the process of learning about how solar panels work for commercial properties, analyzing the benefits to us as property owners, how we can share the benefits with our tenants, and generate tax credits."