In March 2012, Joe Whisenhunt placed a $19 million bet on northwest Arkansas and, four years later, it’s looking like a winner.
Whisenhunt, the head of Little Rock’s Whisenhunt Investment Group, paid cash for 375 improved, undeveloped acres along Interstate 49 in Rogers. The acquisition was actually three separate deals involving OREO property that had been forfeited to Bank of America as a result of $80 million in bad loans.
It was prime land — part of the famed Billion-Dollar Mile — but in post-recession times, developers were somewhat hesitant to re-enter the market. Whisenhunt changed that.
“It signaled the end of the recession,” said Ramsay Ball, executive broker with Colliers International in Rogers. “Those properties were stalled, and now they’re building out. They validated the region.”
Johnny Kincaid, the then-COO of Whisenhunt Investment Group, said at the time of the purchases that the group planned to be patient and prudent with its new properties. Burke Larkin was hired to run Whisenhunt’s Whisinvest Realty LLC in northwest Arkansas, and he joked that for the first year of his new job he made sure the new property was properly mowed and adorned with Whisinvest signs.
“They said it in 2012, that we weren’t buying property at fire-sale prices to sell it at double the money and be done,” Larkin said. “The whole point of buying all this on the interstate was to build something special there.
“The market was at the bottom. I didn’t even come up and focus on any of this. Really and truly, we didn’t start doing any real work until March 2013. We got our signs up and started working it a little bit.”
Learning the Market
Larkin worked in Russellville before moving to northwest Arkansas for Whisinvest. He said one of his favorite business sayings is about how you have to be in the market to know what the market is going to do.
Once Whisinvest was in, it learned some things. Larkin said that, soon after the acquisition, Whisinvest was asked about retail space at Pleasant Crossing.
The interest was so high that Whisinvest developed Pleasant Crossing Shoppes, a 22,000-SF retail center. It opened in 2014 and has filled all but 2,000 SF.
“Everybody said, ‘If y’all will do that, we’ll do this,’” Larkin said. “Mattress Firm said they wanted to be an end cap, and we weren’t even sure we were going to do an end cap. We built that, and I was shocked and amazed by how much activity we had getting that thing leased up.”
Whisinvest sold approximately 40 single-family home lots and 40 acres of residential land in The Grove to homebuilders. Those rooftops under construction ties in with the retail construction Whisinvest and other developers have planned for south of The Grove.
A short distance from Pleasant Crossing Shoppes, Matt Sitton is finding similar leasing success with his Pleasant Crossing Commons. He bought 30 acres of OREO land for $4.3 million from Arvest Bank and anchored the subsequent retail center with Burlington Coat Factory.
The next tenant set to move in is Ross’ Dress for Less, and Sitton said he has another signed lease for a retailer to move from Pinnacle Promenade to his site.
“It’s a lot of momentum, a lot of robustness,” Sitton said.
Larkin said adding residents in previously bank-owned, undeveloped property to the north of Pleasant Crossing is helping fuel interest in more retail development.
“All that old bank-owned property, I like to tell people, has all turned into something,” Larkin said. “We didn’t think we would do anything in The Grove for five or seven years. But we also didn’t think we’d get back into the single-family lot development business, which we haven’t but that is who we have sold to. We like the rooftops.
“Stuff is happening now. There are survey flags popping up and the public hearing notice signs. We’ve seen that a lot in the last four years.”
Outlet Mall Interest
Whisinvest broke ground on the first building at The District at Pinnacle Hills, which is scheduled to have nearly 200,000 SF of retail space and 170,000 SF of office and restaurants on 55 acres. The District is located just south of the Pauline Whitaker Parkway and is next to the Walmart Neighborhood Market.
Larkin said he is in talks with a hotel about selling part of the District acreage closest to the interstate.
Whisinvest has 10 acres of office space across from the Hunt Tower on Champions Drive. Pinnacle Hills West Office Park is 60 percent leased, Larkin said.
One of the prominent tracts of the Whisinvest property is the great swath just to the east of Interstate 49 running from Pleasant Crossing south to Oakwood Avenue in Lowell. The total acreage is approximately 119 acres, and Larkin said interest is high.
Approximately 17 acres of one of the southern tracts is under contract — which in this case is a 6-month or longer process — and Larkin said WIG is interested in turning some of the rest into an outlet mall.
“After the success of the one down in Little Rock with the Bass Pro Shop, we’d like to do an outlet mall here,” Larkin said. “We’ve talked to some of the larger ones, and we’d like to be partners in that. We don’t want to just sell; we want to be a part of the future development.”
Ball represented Bank of America in selling The Grove property for $4 million to Whisenhunt in 2012, and he said WIG’s entry into the market was like the “Wild West with a new sheriff in town.” Ball said that when he came to northwest Arkansas in 2004, he thought the market was so frenetic he stayed out of it.
Now, the market is being influenced by professionals like Hunt Ventures, Whisenhunt, Sitton and others, Ball said.
“It has made it easier for other people to be rational,” Ball said. “I don’t want to compete in a market with someone who doesn’t know what they are doing. You don’t want to do things when crazy people are doing things that don’t make any sense.”
Larkin said he is by nature a fast mover but, at WIG and Whisinvest, everything is thoroughly vetted before any project proceeds.
“I think it is happening faster than they thought, but I’m an optimist,” Larkin said. “I would say we’re not moving fast enough, but in their mind we’re moving way fast.
“We couldn’t have bought it any better. It wasn’t just a great deal; it was a great piece of land. We don’t build stuff that is going to stay empty.”