(Editor’s Note: This is the latest in a series of business history feature stories. Suggestions for future Fifth Monday articles are welcome. Please contact Gwen Moritz at (501) 372-1443 or GMoritz@ABPG.com.)
The Mall at Turtle Creek stands as an iconic symbol of Jonesboro’s bustling retail scene with its scores of stores that help ring up annual sales of $1 billion locally. The 73-acre development elevated the status of Jonesboro as a shopping destination, which was further magnified by the trail of commercial projects that followed.
“The mall has been the catalyst,” said Bruce Burrow, Turtle Creek’s biggest champion and one-time investor. “It’s been very successful. I was in the right place at the right time.”
Officially launched 11 years ago, Turtle Creek represents a landmark development long envisioned for the property by Burrow. The hybrid retail project — part mall and part lifestyle center — became a high-water mark in his storied career.
“Nobody has built and developed more commercial space in northeast Arkansas than me,” acknowledges the 72-year-old businessman.
By his count, Burrow has had a hand in developing close to 3 million SF in Jonesboro, about 4 million SF total if the radius is expanded to all of northeast Arkansas.
“I was relentless going after the retailers,” he said. “If you told me I’d have the problems I had, I would tell you that you were crazy.”
Financial problems began smoldering even before Burrow could enjoy a mountaintop moment with the grand opening festivities of the mall on March 29, 2006.
A good news-bad news meeting with David Hocker & Associates of Owensboro, Kentucky, cast a pall over his crowning development achievement.
The good news from the company in charge of managing the Turtle Creek development was leasing pro formas were met, which qualified the project to move to permanent financing.
The bad news from the firm, which owned a third of the project along with Burrow and Marty Belz of Memphis, was the mall was $18 million over budget.
“The color just drained from my face,” Burrow said.
Fiscal smoke in 2006 erupted into a full-blown corporate conflagration four years after its unsettling appearance. A line of foreclosure actions by lenders against Burrow and his real estate holdings began forming in 2010.
Farsighted land acquisition and grand proposals for lucrative developments turned into overreaching expenditures and overleveraged positions.
“I got caught holding too much raw property,” Burrow said. “The carry on that with taxes and debt with no income offsetting it is killer.”
Mixed in with the downward spiral of his professional fortunes was triple-bypass heart surgery at Jonesboro’s St. Bernards Regional Medical Center in August 2010 and a nine-month recovery.
Burrow said he tried to battle through the financial challenges with his own cash but finally hit the wall and bankruptcy court. His bankruptcy filings listed a nearly $8.8 million loss during 2010 alone.
The sometimes contentious case started as Chapter 11 reorganization on July 30, 2012. That changed two years later after creditors successfully lobbied for the conversion to Chapter 7 liquidation.
“I went broke in the partnership business, not the development business,” Burrow said. “I’m a victim of my own decisions.”
The cost of building a million-dollar residence, ultimately lost through foreclosure, contributed to his cash-draining struggles. High-profile Little Rock projects such as the Peabody and Hilton hotels and the would-be redevelopment of Brandon House fell by the wayside.
The financial fallout trapped commercial projects on the drawing board and relegated grand plans to development limbo.
A trio of open-air, mixed-use lifestyle centers was among the conceptual casualties: the 850,000-SF Shoppes at North Hills in North Little Rock, the 920,000-SF Shoppes at North Park in Russellville and the 700,000-SF Shoppes at West Park, Texarkana, Texas.
What Burrow hoped would be a legacy property with Turtle Creek became an asset in need of liquidation. He had won the battle to replace Jonesboro’s Indian Mall with a bigger, better alternative, but the victory proved pyrrhic.
“I don’t think I measured that day, and its full impact,” Burrow said of the day he learned the full scope of Turtle Creek’s overblown cost. “This mall I had spent all these years on was all of a sudden not going to have the payday, for all the effort put into it, at the end. I could’ve made more money selling off pieces of the ground.”
Rouse Properties Inc., a publicly traded New York real estate investment trust, acquired The Mall at Turtle Creek in December 2012 for $96.3 million. Most of that reflects the assumption of a $79.5 million nonrecourse loan, with a $4.8 million discount factored in by Rouse.
The mall was about 91.6 percent leased back then. These days, the figure is at 88.9 percent.
The deal encompassed shop space totaling 363,248 SF. The balance of the 727,447-SF mall is occupied by anchors such as Dillard’s, J.C. Penney and Target, space that wasn’t owned by Turtle Creek Partners or purchased by Rouse.
“It was a project I took a lot of pride in because nothing like it had been done here before,” Burrow said. “If the numbers had been correct, I would never have had to work again.”
He concedes that even with the enhanced financial security, not working really isn’t an option for him. Burrow said the bankruptcy move amounted to a forced retirement from a 45-year career as a commercial developer.
“In going through the bankruptcy, your time wasn’t your own,” he said.
Burrow also filled the void once occupied by deal-making with a new companion: Bentley, a French bulldog.
His self-described retirement has morphed into more of a hiatus as Burrow wades back into the game with work as a commercial real estate consultant in Jonesboro and Little Rock.
Burrow was discharged from bankruptcy on Jan. 8.
“I own and I accept it and go on,” Burrow said. “I disappointed some people, and I disappointed myself. Some people disappointed me. They were your friends when you were on top.
“I can’t rewrite history. It is what it is. I’m not looking in the rearview mirror. It’s part of my story, but it’s not my final chapter.”
‘The Big Picture’ Guy
Josh Brown, who worked as a commercial broker for Burrow, has reaped the rewards of the mall’s game-changing impact on development in Jonesboro. The arrival of Turtle Creek made Jonesboro a much easier sell to prospective clients and established Stadium Drive (now Red Wolf Boulevard) as the north-south corridor of commercial development.
“Bruce is just a deal-maker, the best guy at the conference table, putting it together,” said Brown, co-owner of Jonesboro’s Haag Brown Commercial Real Estate & Development. “Before most people were capable of seeing it, he was painting a picture, selling a vision, the big picture.
“He always had aspirations of doing a mall in his hometown.”
Burrow was born in Long Beach, California, the child of economic émigrés who came west from Arkansas during the Depression. Real estate work to grow a then-fledgling Taco Bell chain set his course firmly toward commercial development in the early 1960s.
Family ties, maintained over the years with regular visits back to Arkansas, eventually brought Burrow to Jonesboro in 1967. Over time, the city became his base of operation to pursue his own development ambitions.
“I’d always felt like the market was underserved,” Burrow said. “For a long time, Jonesboro was a hard sell, but I believed we had a great opportunity.”
Burrow’s involvement with the mall site remained a constant amid a changing cast of investors who came and went over the years.
During his long association with the property, offers cropped up to sell a small piece here and there. No matter the sales pitch, he always resisted in favor of keeping the acreage intact.
“I’d be tempted for the quick nickel but held out for the long dime,” Burrow said.
Today’s mall site was part of yesterday’s charolais cattle farm owned by J.W. “Doc” Werner. The land’s history includes clearing work during World War II done by captured German troops, held in Jonesboro’s prisoner of war camp.
Burrow remembers pursuing Werner to talk with him about the development possibilities of his property and finally tracking him down on his farm baling hay.
Burrow shed his suit coat in the car, walked into the field, jumped on the flat-bed trailer and began helping stack hay as it came out of the baler.
“We didn’t say a word the whole time,” Burrow said. “When we were done, Doc Werner said, ‘Let’s go have an ice tea, son. You must want to see me real bad.’”
That was the door opener to Burrow marketing Werner’s agri acreage for commercial development for the better part of three decades.
He didn’t live long enough to see the mall become reality, but Werner did see its plans and drawings.
“I was going to call it Werner Mall before he died,” Burrow said. “My partners weren’t too keen on the name, so we ended up calling it Turtle Creek for the creek that runs through there.”
Werner did see Burrow develop a Kmart and other commercial projects on his 80-acre tract at the southeast corner of Caraway Road and Highland Drive. Back in the day, the site was home to the hay field where Burrow made his pitch to Werner.