The University of Central Arkansas Board of Trustees approved the acquisition of land and the issuance of bonds to finance and design a 67,500-SF mixed-use building on its campus.
On Tuesday, university officials and Ozark Pizza Co. LLC of Little Rock, reached an agreement on the acquisition of a .12-acre lot, which currently houses a Papa John’s restaurant, at the corner of Donaghey Avenue and Bruce Street. The agreement approved by trustees will pay Ozark Pizza $236,000 for the lot, and another $164,000 if the property is vacated by April 15.
Related: Download the agreement here (PDF).
The board, which met by teleconference Friday morning, also authorized the issuance of $17.5 million in bonds to finance the design and construction of the $17.6 million project, dubbed the Donaghey Hall. Nabholz Construction of Conway and Doyne Construction of North Little Rock have been recommended as the general contractor and construction manager on the project, at a negotiated rate of 4.75 percent.
More: Read the board’s entire agenda here (PDF).
The four-story building would include 13,500-SF for lease, in addition to housing for about 165 students. The total cost for the project has been estimated at more than $17.6 million. Construction-related costs are estimated at more than $15.4 million. The cost of issuance and bond reserve and interest payments make up another more than $2.1 million. UCA has agreed to put $250,000 toward the total cost.
Johnston confirmed there had been talks with Waffle House, but said they had not been fruitful to that point.
“We’re not gaining a lot of traction with [Waffle House],” he told Arkansas Business. “Typically, they have locations close to the interstate, so this is different from the norm for them.”
Names of other possible tenants were not disclosed by Johnston, who said there had also been talks to have a grocery store and pharmacy, a financial institution or bank, and a special retail store that offers merchandise and university apparel.
Related: UCA Plans to Reshape Donaghey Avenue
In an email to Arkansas Business on Wednesday, Christina Madsen, vice president for communications, public relations and marketing, said no decisions have been made on tenants and would only be made if the board approves the property acquisition Friday.
‘One Final Offer’
There had been discussions of Papa John’s remaining in the new space, Donaghey Hall, but no such terms were included in the agreement.
According to a Log Cabin Democrat article, Jim Brown, chairman of Ozark Pizza, said Papa John’s would not lease space in Donaghey Hall and would instead move across campus to a shopping center on Farris Road.
The agreement was the end result of prolonged talks between Ozark Pizza and UCA. The back-and-forth offers and counter offers between the two parties have taken up the better part of a year.
“…[A]ll prior offers that we have proposed are rescinded,” President Tom Courtway said in a letter to Ozark Pizza on Monday. “I am, however, making one final offer in an attempt to resolve this matter by [Tuesday].”
Below is a timeline of all offers:
- May — Property appraised for $185,000.
- Nov. 14 — Ozark Pizza Co. offered $185,000, in addition to: Option to remain in current location until retail space in Donaghey Hall is complete and the right of first refusal to lease retail space in Donaghey Hall for 10 years.
- Dec. 8 — Ozark Pizza Co. counters with $435,000 offer, relocation compensation of $270,000 and a 10-year lease for retail space with automatically renewable 10-year options. Also provided appraisal from Prime Bank of Edmond, Oklahoma, from 2012 which valued the property at $347,000.
- Dec. 16 — UCA counters with a $236,000 offer, which specifies the closing would occur prior to Feb. 1. If the property was vacated by March 15, an additional $100,000 would be paid to Ozark Pizza Co.
- Dec. 29 — Ozark Pizza Co. counters, again, at $435,000, plus relocation compensation of $140,000. Additionally, Ozark requested to remain in the existing facility until July 1.
- Monday — UCA makes final offer of $236,000, and specifies the closing would occur prior to Feb. 1, and that the property must be vacated by May 1. If the property is vacated by April 15, an additional $164,000 would be paid to Ozark Pizza Co.
- Tuesday — Ozark Pizza Co. accepts UCA offer.