A testy landlord-tenant relationship in downtown Little Rock grew more contentious as the owner of the 24-story Bank of America Plaza sued the Wright Lindsey & Jennings law firm.
200 West Capitol LLC, a California investor group, is suing to collect more than $3.3 million representing delinquent rent, late fees and the full payout on the law firm’s lease set to expire July 31, 2025.
The dispute is tied to the landlord not completing negotiated repairs and maintenance on the building and the largest tenant in the building enacting a rent abatement clause in the lease agreement.
The limited liability company spent more than $400,000 for improvements to the lobby and elevators, windows, thermostats and boiler upgrades, according to the complaint.
The investment group claims the work was substantially complete and in some cases accepted by Wright Lindsey & Jennings, yet the firm withheld a disproportionate amount of rent totaling more than $400,000.
The law firm paid partial or no monthly rent during Aug. 1, 2020-Aug. 1, 2021, according to the complaint filed Aug. 10 in Pulaski County Circuit Court.
Wright Lindsey & Jennings leases the top five floors and the 18th floor totaling 52,255 SF.
A message for the law firm’s managing partner, Stephen Lancaster, was not returned by deadline Friday morning. Arkansas Business will update this story.
But in an interview with Arkansas Business for an Aug. 2 story on Bank of America Plaza, Lancaster expressed hope that the owners would sell the 52-year-old building.
“We’re not in the loop on that,” Lancaster said of the prospects for a sale. “We hope that the building is sold soon and gets some stability that goes along with that.”
200 West Capitol LLC acquired the building and its adjoining seven-story parking deck for $10.2 million in May 2006. The company has since entertained offers for the building but none have resulted in a deal.
“My guess is at some point they or their lender will bring the value of the property to a point where someone can buy it,” one Little Rock commercial realty veteran told Arkansas Business. “It’s not a pretty picture to make it work as an office building. It’s a good candidate for a conversion, but that involves a lot of money.”
Photos compiled by the law firm show the building in various states of disrepair and the victim of water damage in February.
In an interview with the Arkansas Democrat-Gazette, Lancaster said the law firm could afford to pay all the rent but isn’t required to under the terms of the lease negotiated last year.
"This is certainly not a situation where we can't pay the rent," he said, according to the newspaper. "We're enforcing the terms of the lease. We've actually set aside all the money we've abated and have kept that in a separate account to demonstrate that this is not a financial issue.
"This is a landlord-tenant problem. We're simply enforcing the contract we negotiated."
Lancaster told the newspaper the law firm could file a response to the landlord’s lawsuit as early as Friday.