Hotel Awarded $4.75M After Highway Project Takes Space

Hotel Awarded $4.75M After Highway Project Takes Space
The Holiday Inn Express & Suites at 811 E. Fourth St. in downtown Little Rock (Mark Friedman)

The owner of a Holiday Inn Express & Suites in downtown Little Rock recently received a $4.75 million judgment to compensate it for space taken for the Interstate 30 Crossing project.

In 2020, the Arkansas Highway Commission wanted to pay East Village Hospitality Ltd. about $325,000 for taking about 60 feet of the west side of the lot at 811 E. Fourth St. for the construction project.

East Village balked at the amount, saying it was worth millions of dollars because it resulted in the loss of 19 parking spaces, according to one of its attorneys, Quentin E. May of Little Rock.

“That had a huge effect on the operation of the hotel,” May said, because there’s no street parking or parking lots in the area.

After the Highway Commission took the property, the 100-room hotel, which opened in August 2021, was left with 45 parking places, resulting in travelers having to park several blocks away or in a gravel lot.

East Village offered valet parking for a period but stopped the service after customers complained.

The loss of parking also puts East Village at risk of losing its franchise agreement with Holiday Inn because it doesn’t have the required number of parking places, May said. East Village had received a waiver from Holiday Inn’s parent company to have only 64 spots, which was before the spaces were taken.

The loss of parking spots also is expected to reduce the hotel’s revenue.

East Village spent a little more than $15 million to build the hotel, and one analyst showed that after the loss of the 19 parking spots the hotel is worth only about $10.5 million, May said.

The jury voted 11-1 in favor of East Village in the eminent domain suit filed in Pulaski County Circuit Court.

In addition to the judgment amount, Pulaski County Circuit Judge Herbert Wright ordered 6% interest on the amount starting from Sept. 2, 2020, until the judgment is paid.

May also said that he plans to ask Wright to order the Highway Commission to pay court costs and attorneys’ fees in the case.

The Highway Commission was represented by the Arkansas Department of Transportation Legal Division. Rita Looney, chief counsel for the state Department of Transportation, declined to comment on the case on Thursday because the decision to appeal the judgment had not been made.