
Majestic Location
Brainstorming on what to do with the nearly 5-acre former site of the Majestic Hotel is winding down. Destruction of the vacant landmark hotel that began with years of neglect was accelerated by fire and a partial teardown in 2014, pushed by safety-driven condemnation in 2015 and completed with final demolition in 2016.
New takes on old properties have become a trending theme for activity in downtown Hot Springs. Redevelopments dominate the storyline, but new construction provides an undercurrent to the narrative.
“The last five years, it’s been slowly building speed,” said Mike Scott, the city’s chief building official and community development administrator. “It’s moving faster than I’ve ever seen. And I was born and raised here. I deal with something new downtown almost every day.”
Arkansas Business visited with several players making new things happen in the Spa City for a sampling of downtown doings.
Ventures by Dr. Daron Praetzel have provided a steady stream of paperwork and plans for Scott and other city officials to review.
Praetzel began wading into downtown Hot Springs real estate investing in early 2016. These days, he’s $3.6 million deep in acquisition costs alone on four Central Avenue properties.
“When I got here nearly nine years ago, I was driving downtown on my first day here and looking at a lot of vacant buildings,” said Praetzel, an oral surgeon. “I had interest in doing something. I just had to wait until I got settled in my practice.”
He made his first redevelopment play in February 2016 at 812 Central, a $575,000 purchase of a circa 1920 building, known locally as the J.C. Penney Building, with 12,740 SF under roof.
Praetzel followed two months later with the $1.2 million buy of the 39,534-SF former Bank of America Building at 528 Central, built around 1970.
Next was 723 Central, which he began assembling last year in deals that totaled $1.1 million. Built in 1909, the seven-story 27,495-SF building is known by locals as the Citizens Bank Building.
When the neighboring 22,984-SF Belle Arti Building at 719 Central became available, Praetzel acquired it in January for $800,000.
The standout within these projects is The Vault, a fine dining establishment that anchors the ground floor at 723 Central. The fun, funky restaurant didn’t open as quickly as some hoped last year, but Praetzel believes the added attention to detail made the wait worthwhile for patrons.
“We’ve been complimented on the performance and how it works,” he said. “We didn’t want to open until it was ready. People kept asking us, ‘When you gonna open, when you gonna open?’
“But we were not going to open until we had the details worked down to the pepper shakers. We stayed the course.
“That’s how we’re going to run all our things. We have the building and our plans, but we’re not going to hurry and do something that wasn’t to our standards.”
Off and running since May, The Vault provides a view of more to come at 723 Central. And yes, a real vault room that seats four is available for private dining.
Floors four through seven are being finished as vacation rental apartments, available on a weekly or weekend basis. The fourth and fifth floors will have two units each, with the sixth and seventh home to one suite each.
The third floor is earmarked for office space, and the second floor will be redone as a theme lounge, with details kept under wraps for now.
“We’re cautious because the hawks are circling trying to find out what we’re up to, so they can do a version of what we intend to do,” Praetzel said of the local competition. “That’s good. We’re setting the bar for all this stuff.”
The Vault General Manager Randy Womack, who refers to Praetzel as his co-dreamer in the project, is also helping oversee the “severe renovation” planned for a new restaurant in the Belle Arti Building and other dining adventures in the works.
“It will be radically different than anything we have downtown,” Womack promises.
Work on that ground-floor restaurant and vacation rental units on floors two through five at 719 Central is set for the indeterminate future while the focus remains on completing Praetzel’s three other buildings.
Downtown Draw Brings New Players
(Photos by Karen E. Segrave | Map source provided by Google Earth)
‘On the Cusp’
New from-the-ground-up construction has joined the wave of downtown redevelopment activity, too.
Ken Wheatley, whose family has a long history with Hot Springs real estate, is in the final stages of transforming a parking lot across from the Buckstaff Bathhouse into a $750,000 mixed-use project.
The 12,000-SF building at 502-504 Central Ave. is the first new construction across from bathhouse row in more than half a century. The ground floor will be devoted to commercial tenants in suites bearing the 502 Central Ave. address.
Two Central Avenue retailers, Fat Bottomed Girl’s Cupcake Shoppe and the Pour Some Sugar on Me sweet shop, will relocate to the new building. The top floor will be Wheatley’s residence.
“We thought we’d be in by September, but now we’re looking at December,” Wheatley said. “There’s a lot of interest in downtown living. Housing and employment: If you have both of them, you have a vibrant downtown. It’s on the cusp.”
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David Hafer began investing in Hot Springs property after moving to the area six years ago and expanding his development interests from farm management into commercial real estate.
Two of his downtown projects focused on bringing life to vacant upper floors of Central Avenue storefronts.
At 802 Central, Hafer upgraded the second and third floors of the 6,262-SF building to accommodate residents. He sold the unfinished but improved residential space in the circa 1920 building and retained the ground-floor retail space as an investment.
Hafer took a similar approach with a two-story, 6,396-SF project at 833 Central.
He developed two apartments in the upper floor of the circa 1925 building, even adding a walk-out deck overlooking Central Avenue. The ground-level space became home to a Core Public House, serving up craft beer and pub fare.
“Used to, nobody talked about living downtown,” Hafer said. “That has changed. There are a ton of people who want to be down here. They just don’t know how to get it done.”
He hopes to tap into that demand with a new project on an undeveloped acre across from 833 Central that he put together in late 2016 and early 2017 for $865,000. Hafer is looking to develop a mixed-use, three-story project on part of the property. The ground floor would be marked for retail use with the upper floors containing 24 apartments.
“I’ve taken things to schematic [drawings],” he said of the project’s progress.
Interest in having a downtown res-idence is sparking more talk of converting dormant upper floors of commercial buildings into apartments or condos.
“There’s definitely money that is wanting to get spent down here,” Hafer said. “The growing demand is putting downtown on equal footing that’s more in line with a lake home.”
Less than two blocks southwest of Hafer’s proposed new apartment site, a husband-wife team is delving into their second redevelopment project.
“We’re accidental real estate developers,” said Zac Smith, co-owner of SQZBX (pronounced “squeezebox”) Brewery & Pizza Joint.
He and his wife, Cheryl Roorda, accomplished their first redevelopment project at 236 Ouachita Ave. The reimagination of the 4,085-SF, circa 1925 building into a combo craft brewery, pizzeria and eclectic low-wattage, solar-powered FM radio station was fueled by sweat equity, historic tax credits, small-business loans and more.
They consider their second redevelopment venture far less daring, with an ongoing business to help cash-flow improvements.
Through their Not Our First Circus LLC, Smith and Roorda bought the neighboring Starlite Club at 230-234 Ouachita in March. They tidied up the place and put some new-owner sheen on it but have yet to make any big changes.
“People like it as it is,” Roorda said. “It’s not the most banging club in Arkansas by any means, but it’s holding its own.”
The 4,720-SF project is an amalgamation of two buildings, the oldest dating to 1925 and the other to 1969. The undeveloped northern slope of the property also has potential beer garden written on it or another interesting possibility.
“We’ll come with a big idea in the next year to knock it out,” Smith said of plans for the Starlite project.
Majestic Site
On the north end of Central Avenue, question marks remain above a prominent property now under city ownership. What will be developed on the nearly 5-acre former site of the Majestic Hotel?
A performing arts center is a popular amenity some would like to see on part of the now-vacant land.
“We hope the community rallies around that — whether on the Majestic site or elsewhere remains to be seen,” said Corey Alderdice, director of the Arkansas School for Mathematics, Sciences & the Arts.
Another idea with strong support is to develop an open-air public pools complex to showcase the city’s thermal waters.
Lance Spicer, assistant city manager, said the visioning process for the property should soon pick up steam, with details taking shape in 2019. He wouldn’t be surprised to see some sort of public-private partnership emerge.
“We’re excited to move into the redevelopment stage,” Spicer said.