The Residence Inn by Marriott at 219 River Market Ave. in Little Rock.
Strategic Pairing I
Sage Partners entered into an exclusive alliance agreement with Cushman & Wakefield.
The pairing brought together a leading Arkansas commercial real estate firm with offices in Rogers, Bentonville and Little Rock and a global leader in commercial real estate services.
“We’ll still be Sage Partners, with the same ownership and leadership,” said Marshall Saviers, president and principal of Sage Partners. “This alliance with Cushman Wakefield is something we’ve been working toward for years. It’s something that is really exciting. They’ve never had a presence here in Arkansas.”
Talks of a Sage Partners-Cushman Wakefield alliance gained momentum in May during RECon, the global retail real estate convention in Las Vegas orchestrated by the International Council of Shopping Centers.
“We’ve been doing work with them for 10 years, and the alliance kind of formalizes this partnership,” said Brian Shaw, CEO and principal of Sage Partners. “The alliance office emphasizes that the commercial market in Arkansas is really maturing. That’s the big thing that Cushman & Wakefield coming in says to the marketplace here.”
Founded in 2005, Sage Partners employs 17 brokers and more than 45 other professionals. The full-service commercial real estate firm specializes in brokerage sales, leasing, development and property, facilities and asset management.
Sage Partners manages more than 4.5 million SF across Arkansas. During the past 12 months, the firm has sold 1.3 million SF of commercial space as part of transactions totaling almost $300 million.
“With Sage, we are better positioned in Arkansas, a significant Fortune 500 hub, to further create value for clients through deep local insight,” said Rich Cenkus, chief operating officer at Cushman & Wakefield, in a press release.
Cushman & Wakefield is among the largest real estate services firms in the world, with 48,000 staffers in about 400 offices in 70 countries. During 2017, the company generated revenue of $6.9 billion.
Strategic Pairing II
Newmark Moses Tucker Partners and The Lasiter Group, both of Little Rock, formed a strategic alliance to practice commercial real estate brokerage, management and development.
Principals in the two firms have collaborated before, most notably with downtown Little Rock development projects. The companies are not merging, and both will remain separate, privately held entities.
The Lasiter Group developed Villa Vue Apartments at 1300 Scott St. in the SoMa neighborhood of Little Rock and the Rose Building apartments at 307 Main St. Newmark will lease and manage both projects.
Newmark has offices in Little Rock, Fayetteville and Bentonville. Along with Lasiter, the two manage about 6.7 million SF of commercial space.
“We expect the synergy between the two groups to be significant,” said Chris Moses, president and CEO of Newmark. “We are delighted to start this new venture with Tommy Lasiter and his team.”
Lasiter, founder, principal and managing partner of The Lasiter Group, said it made sense to affiliate with another market leader as the company establishes its vision for the next decade.
“Our organization’s vision is to drive and deliver commercial real estate projects that add value to the markets where they are located — providing benefits to the communities and people that they serve,” Lasiter said.
The Lasiter Group has moved its offices from the Stephens Building to the Arkansas Capital Commerce Center in Little Rock’s River Market District, alongside Newmark’s office. Lasiter said it will continue to work with its longtime partner, Doyle Rogers Company.
The Lasiter Group, whose leaders also include Principal and Partner Ryan Lasiter, announced two new employees for its subsidiary, Lasiter Real Estate: Virginia James, who will oversee property management for the organization’s asset portfolio, and Charles Pugh, who will be involved with leasing and brokerage efforts.
Big Office
A state agency struck a $26 million deal for a six-story office building in Little Rock’s Riverdale area.
The Arkansas Development Finance Authority bought the 303,355-SF Building 4 on the former Verizon/Alltel campus at 1 Allied Drive from Alltel Corp., an affiliate of Verizon Communications Inc. of New York.
In addition to the 17.47-acre office development, the transaction included an 11.6-acre parking lot along Riverfront Drive and Cottondale Lane and a 9.28-acre parking lot-soccer field on the south side of Cedar Hill Road between Riverfront Drive and the Little Rock & Western Railway tracks.
Apartment Sales
A 288-unit apartment project in North Little Rock weighed in at $24.82 million.
Lexington Park Apartments LLC, an affiliate of Tulsa’s Case & Associates Properties, bought its namesake complex at 7601 Vestal Blvd.
The nearly 15.4-acre development was sold by Vestal-Burkhalter LLC, led by John Burkhalter.
Big Medical
A $12 million transaction launched a medical redevelopment in west Little Rock.
P.G.A. Land & Realty LLC, led by Dr. Dhaval Patel, acquired the 121,922-SF former Kmart Shopping Center at 10901 N. Rodney Parham Road.
The group is transforming the vacant Kmart space into Premier Medical Plaza and the new quarters of Premier Gastroenterology Associates.
The sellers were an investment group with ownership divided among A.B. Arkansas LLC, 50%; Eben Partners 9.4%; and International Paint Co. of Arkansas Inc., 6.2%; all led by Joe Selz; and Schlereth Family LLC, led by John Schlereth, 25%; and Catherine Stark, 9.4%.
In addition to a 10 Fitness location, the nearly 15.8-acre development is home to Black Angus restaurant, Grady’s Pizza, Grapevine Wines & Spirits liquor store and Take 5 oil change project.
Location, Location
Now that medical marijuana is legal in Arkansas, the burden is on the licensed dispensaries to meet stringent criteria affecting where they can set up shop.
The 32 licensed cannabis dispensaries had to be at least 1,500 feet from any school, church or day care center. For licensed cultivation companies the barrier grew to 3,000 feet.
Given the number of churches and schools in Little Rock, and elsewhere, that is a narrow path to walk. The Arkansas Medical Marijuana Commission gave three dispensaries permission to move before they had even opened.
RXMed, Inc., moved 50 miles from Prescott to Texarkana after vetting 15 sites that for one reason or another failed to meet requirements. At the meeting of Little Rock’s 12th Street, South Rodney Parham Road and Kanis Road, the Grassroots OpCo and Natural State Wellness dispensaries are going to be close neighbors.
“Struggle is a mild term for the challenge of meeting these strict siting requirements,” said Little Rock lawyer Robbin Rahman, whose parents own a dispensary planned for Conway. “In many towns and cities, almost every square foot is within that range of some entity, or too close to risk the whole enterprise when there’s uncertainty.”
The right kind of real estate has value, however. In 2017, Henry P. Willmuth paid $342,250 for a property on Kanis Road, failed to obtain a dispensary license, and wound up selling to a buyer affiliated with Grassroots OpCo for $900,000.
In 2018 Marijuana Business Daily, of Denver, estimated sales in emerging cannabis markets and predicted eventual sales of $45 million-$65 million a year in Arkansas.
Big Hotel
A 107-room hotel in downtown Little Rock’s River Market District was at the center of a transaction topping $20.3 million.
SREIT RI Little Rock Propco LLC, an affiliate of Starwood Capital of Greenwich, Connecticut, purchased the Residence Inn by Marriott at 219 River Market Ave. for more than $20.3 million.
Built in 2013, the six-story hotel was sold by NFII/CI Little Rock LLC, an affiliate of Noble Investment Group of Atlanta,.
Public Incarnation
BSR, an $870 million-asset real estate investment trust headquartered in Little Rock, quietly made its debut as a public company by way of Canada last year.
Shares from the company’s $135 million initial public offering began trading May 18 on the Toronto Stock Exchange (TSX HOM.U).
The 13.5 million-share offering was used to shed $122.3 million of debt secured by BSR’s portfolio of 47 market-rate apartment projects.
“It puts us in a position to grow our company,” said John Bailey, CEO of BSR. “We’re at a 45.6% leverage to gross book value. That’s an incredibly strong balance sheet.”
The corporate moniker is a nod to Bailey Summit Residential, the result of a 2012 merger of Little Rock’s Bailey Properties and Summit Housing Partners of Montgomery, Alabama.
BSR is the latest incarnation of the real estate enterprise the late Virginia Bailey and her husband, Howard Ashley Ted Bailey, Jr. (known to most as H.A.T.), began building with Bailey Corp. in 1956.
“We want people to draw that line,” John Bailey said of his parents’ business legacy. “This is the current version of what the family brought to Little Rock.”
The list of Little Rock projects includes the Foxcroft, Campus Place, McClellan Place, St. Charles and St. Thomas residential subdivisions and the Foxcroft, Andover Square and River Bend townhomes projects.
Over the years, the Bailey family amassed through acquisition an apartment portfolio of more than 3,900 units primarily in the Little Rock-North Little Rock area that became Bailey Properties. John Bailey bought out his family’s interest in 2002.
The IPO created about $140 million in acquisition liquidity BSR quickly began putting to work. The company expanded its holdings to 48 multifamily properties and 9,879 units on June 1 with the $23.4 million acquisition of Brandon Place, a 200-unit garden-style residential community in Oklahoma City.
The deal pushed the company’s total assets beyond $870 million.
That’s a 63% increase from BSR’s total assets of $533 million at year-end 2014.
The company generated revenue of $86 million in 2017, compared with nearly $76 million in 2016.
Big Industrial
A 557,950-SF industrial project in east Little Rock tipped the scales at $10.8 million.
6901 Lindsey Road LLC, an affiliate of Investment Grade Loans of Los Altos, California, sold its namesake address.
The 25.5-acre development in the Little Rock Port Industrial Park is the former General Electric distribution facility.
The buyer is 7240 Partnership LLC and Beckett Road Partners LLC, affiliates of Eliken Property Management of New York.
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