LRretail

The parent company that owns Banana Republic, Limited, and Gap is not doing well... and neither are many clothiers that are getting a bit long in the tooth. That's not great to hear but it's the truth. And yes, the retail apocalypse is that bad. We've just now started getting the trickle down effects that other markets have already suffered. Although it's not really an "apocalypse" per se. It's more an alteration of retail channels. Folks are starting to change the way they spend and it's either adapt or die. Similar I suppose to when brands like Woolworths and MMCohn were downtown on Main St. but then went into indoor malls like Park Plaza. Now it's time to be on the mobile apps or someone else will.

From my recollection there was a little decorative piece that said Paramount Life on ground floor but it's being referenced as Pyramid Life Building at this point. I do believe something happened to the facade a while back but judging from the activity around the structure, it looks like the entire exterior is being addressed. This building has been vacant for some time. Over 30 years I'm sure. It's been vacant ever since I've been doing business downtown. I'm glad it's being redeveloped rather than being torn down into another parking lot which is what the lawyer next door wanted to do with it.

7500sf strip anchored by a local salon. Remainder of the building is not leased.

In speaking to some close to the situation, the outlet mall stores would be closing too but the penalties for doing so are too great. They are waiting for some of those penalties to burn off and then those locations will close as well. Nike Store in the Promenade will be closing and leaving the outlet mall location open as they are losing money operating both stores. Unfortunately, I think this strategy will backfire as I don't see those that frequent the Promenade location going to the outlet mall store except during the holidays. Most of the traffic seen at Promenade is driven by convenience and impulse purchase from those that live and work in a 2 mile radius. Look to 2021 for there to be more traction in the tenant mix at Promenade when a significant portion of the special improvement tax repayment goes away. Promenade won't fill up but tenants will be more inclined to take up residence here.

Redevelopment of the Pyramid Life Building at 319 2nd Street has begun. Plans are for a restaurant on the ground floor and loft apartments in the remainder of the building.

Construction on new shopping options just south of the Doctors Building on University should also be noted. It will be difficult for Park Plaza to retain tenants in an indoor mall setting. The combination of significant changes in consumer behavior towards online retail and newer facilities giving those brands that still garner in person foot traffic better options to serve their customers will prove difficult for Simon Malls in general thus Park Plaza. But the declines similar to what Park Plaza is going through have occurred at an accelerated rate in other metro areas and is purely a reactionary result to trends that are more than a decade old. There were those of us that wanted the newer developments just as bad as those of us that wanted things to remain the same. Arguably the demand for retail space did not keep up with the growth of newer facilities. But for sure the other options have had a profound impact on Park Plaza itself. It's held up well nonetheless.

It's supposed to be a freestanding Japanese restaurant...cause there's not enough of those around already or anything.... But hey at least it's not another Mexican place, pizza joint, bank, or burger place. It's also not 100% set in stone.

Zoe's actually opened back up due to the their contractual agreements when the property was sold. Although I think it will close again in the near future. Red Lobster and Olive Garden continue to drop in sales. They do ok in Little Rock but follow the downward trend of the brands nationally. David's Burgers actually does fairly well with average unit volume of around $2M in its 10 locations in Central Arkansas. The same goes for Tacos4Life and Slim Chickens. Both of those brands do very well in our area. McDonalds stores still see high volumes no surprises there although they're on a slightly downward trend compared to last two years sales. It takes about $3M in sales to break even in a full size McDonalds operation. Chick-Fil-A is the leader in sales in Central Arkansas with between $3.7M - $4.9M sales figures throughout the Central Arkansas area. Overall local chains as an aggregate are beating out the national competition in our market with a few exceptions.

You're correct. I drove by today and they were surprisingly busy. Upon further research I believe the arrangement is that the building and property where Zoe's is located recently sold in the last few months. As part of the sale, Zoe's had to be open to pay rent for a fixed amount of time. I think they were closed for a time but opened back up as a condition of the sales contract. I don't know this to be the case 100% but I'm 85% certain this to be the case. We will see if they remain open. Overall I think it a poor decision to go head to head with Taziki's less than a stone's throw away.

It's a much more simple theory. Central Arkansas in general is very adverse to chains. There are exceptions like Chick-Fila and things like that. But anyone looking to introduce chains to Central Arkansas is usually in for a hard fought situation. Many chain restaurants that do gangbusters in other markets do not experience similar sales in Little Rock but it's the same in Conway, NLR, Benton, Bryant, etc. One good example is Blaze Pizza. It's the fastest growing, often more profitable chains in the country. But the franchisee who signed a multi-store deal for Arkansas has stopped building stores after Conway and Little Rock. Most likely those existing stores are up for sale. I'm hearing discussions that the one in Pleasant Ridge will close. Krispy Kreme stores overbuilt and alot of them have closed but the one on Shackleford shouldn't have. Donuts do make money or else the Shipleys wouldn't be open. But we all support Shipleys over Krispy Kreme. David's Burgers over all the others. Slim Chickens and Chick Fila over the others. Tacos4Life over the others. On and on it goes. So we can't expect Joe's Crab Shack or something like that cause there's just not enough support there.

Because single family residents will always complain about having apartments. Doesn't matter if they are luxury apartments or low income housing. Apartments will always be blamed for everything from crime to traffic problems. Folks at the city don't like to hear complaints so that's when these types of things start occurring. Additionally, the City may not have enough utility infrastructure to support large numbers of concentrated residents along some portions of town. I would say having worked in Bryant and other parts of Saline County that a lot of residents would say "oh send that stuff over to Benton".

Burger 21, Zen Thai, Zoe's Kitchen, Krispy Kreme, Mooyah have all closed in West Little Rock in the last 30 days or so. Look for more closings as the restaurant trend moves more towards off-premise 3rd party delivery. Smaller footprints with less foot traffic in the store. More kiosks replacing traditional order taking at the counter particularly in QSR concepts. Increase in self check out in grocery as well. Increase to $11/hr minimum wage is changing the labor market. Those that can't absorb (usually chains as we are seeing) are closing their doors. Also an increasing rate of closures in Chenal Promenade. Some new concepts opening in vacant spaces. Time will tell if those will stay. Look for more restaurant closings around Cantrell and Taylor Loop as well as Chenal and Markham.

It's unlikely that Costco will ever be able to break into Arkansas. Wal-Mart would likely be able to, as they have for so many years, stave off the effort to Costco or any similar competitor to move into home territory.

Not sure where ArDemGaz is getting their information from but I have first hand knowledge that the current owner of the closed Applebee's location is under contract with someone to sell the property and it's not Red Robin or anyone else associated with the brand. So that story is a bust. In speaking with the development team at Red Robin, the location in Benton was placed there because of the Dallas based property developers' close relationship with the brand. The property was also leased/sold to Red Robin under a hybrid deal that made it very cost effective for them to show up. The presence of the Red Robin in Benton also made sense to them because of the relative lack of competing restaurants. They've stated that the Little Rock market is in their opinion oversaturated with local and chain concepts that compete with Red Robin. The development team also cites the lack of good real estate in the City and they are unsure that opening a location in Little Rock would be a "home run".

The thing to realize about the seafood restaurants is the cost of doing business. Food cost alone is about 40% of revenue generally. Unless you're in a really dense area you're generally not going to see something like Pappadeaux or Kona Grill. In order to combat the higher food cost, a bigger restaurant is necessary to do a larger volume. This is one of the reasons why Cajun's is as big as it is. Unless it's fried fish or that kind of food, it's generally harder to make money doing by your definition a true seafood restaurant. Restaurant scene in Little Rock leans heavily towards independent groups. The customer in Central Arkansas really supports locals so chains or out of town concepts don't generally do as well. That's being in the restaurant industry in the city for 35 years talking. I strongly agree with you that we don't need any more burger, Mexican, pizza, asian restaurants. I'm pretty sure we got all that covered. But the simple fact of the matter is that the customer supports these types of concepts, especially if they are local. Tacos4Life, David's Burgers, Big Orange, US Pizza, Señor Tequila, on and on. Having diversity in restaurant selection is great but if the customers don't support them then they close down. I also agree that we need more family friendly options. Main Event would be fun. Playtime Pizza did not make money for most of its existence. So again, you and some other consumers may really want something specific. But if the rest of the general population in the area don't support things that do come through, other things that provide diversity aren't going to show face. Zaxby's is also a really good example. Yet another Slim Chickens, ChickFilA competitor. They opened the Little Rock store on Kanis LAST out of the 4-5 in the MSA. #1 - Because they couldn't find good real estate and #2 - Because they were fearful that they wouldn't be successful if Little Rock was the first or second location. I know it's another QSR brand but it's a successful one as another example - Panda Express. They have five locations or more in NWA. One in Hot Springs, Conway, etc but not Little Rock. It's not for lack of trying but they can't find the real estate and the competition comp set from the independents is too strong. Not saying that I'm right but it's just my observation over quite a long period of time in the restaurant industry. I very much wish it were different.

Looks like you were right. Was driving to Colonel Glenn area on some business today and saw what looked to be a large amount of new Mini vehicles parked towards the rear of McLarty Honda. I suppose they came from Parker Mini being redistributed for sale at BMW of Little Rock owned by Mark McLarty.

Went to the Apple Store yesterday to get some work done on my Mac. Driving into the main entrance of Promenade I felt this overwhelming sense of sadness by seeing former sites of Pei Wei, Del Frisco's, Tavern, and then Kenneth Edwards all dark storefronts with significant window space. Nothing new to talk about. It's just sort of depressing. Of all the things that bums me out the most is the closing of Portrait Innovations. I took my family here to get photos done from time to time. Best part was they would print your photos out for you right after the session so you didn't have to get stuff ordered or wait forever for them to come back. Odd thing to miss but we thought it was a great product. I am HOWEVER very grateful for the AMC Chenal 9 movie theater being open so we could go see Aquaman on the IMAX as a family.

I agree that the size of the dealership was because it was pre-existing. From my recollection though I think the Parkers paid a hefty sum for the property and then spent another hefty sum renovating a bigger space than necessary for a relatively niche brand. It's been a few years but I remember there was a struggle between the Parkers, Landers, and Crains trying to get Porsche to split space at the current Mini dealership with all three groups vying for the property. Mini asked what was then the Asbury Group to open a Mini operation on Breckenridge but they were rebuffed since Asbury had no space with Volvo next to BMW. Then Mini sought out someone new and the Parkers competed against Landers (who later teamed up with Crain) for the Mini franchise. Landers brought in Porsche to sweeten the deal which angered that Parkers who saw themselves as the luxury brand purveyors of the area. The Parkers tried to compete for the same Porsche rights with Landers thwarting that effort. Porsche later called it a "business decision" not to enter the market. So Parkers ended up with the Mini franchise solo with nothing else to complement the space. Here's to hoping you're right. And to hoping that something else productive moves into the space. You're right. There are quite a few Mini owners in the market.

Perhaps the reliability problems of the brand coupled with a rather overzealous investment in relation to the market had a lot to do with it. For example, the Nashville MSA encompasses a population of almost 2 million people. The Mini dealership in Franklin, TN near Nissan North American HQ is roughly half the size of ours in Little Rock. Little Rock MSA including Pulaski, Faulkner, Grant, Perry, Lonoke, and Saline counties has just under 750,000 people. The Mini dealership in Franklin is also surrounded by dedicated dealerships for Porsche, Audi, Mercedes, and a joint Bentley / Aston Martin / Rolls Royce store as well as a large Volkswagen dealer. I very much hope that Mark McLarty picked up Mini but the closure / move is certainly a loss for WLR.

Reported in the Arkansas Democrat Gazette this afternoon that the Mini dealership at Chenal and Markham is closing. The Parker Group has decided to terminate their Mini franchise as of today. I would suspect they're going to fire sale the Mini inventory remaining and move the used cars to another dealership. This leaves a rather big hole at this intersection. My hope is that a luxury car brand populates this location or that the Parkers repurpose the site instead of walking away from it.

Wasn't close enough to Mr. Gleason's home. That is the entire reason why Bank of the Ozarks current HQ is where it is and their home base will be out west close to Chenal as long as he lives in the area.

I'm not sure there would be enough space for Gleason Land at the current Bank of Ozarks HQ. I know they are planning for a hotel and other amenities at the site they are building on. But I agree I wish they would have just expanded at their current site. It would keep a lot of interest closer to the Promenade. I feel like it's to the Aloft's detriment that Bank of Ozarks is going a bit further away. Although I could never see Bank of Ozarks selling that property or doing away with it. Much like their first building at Chenal & Markham.

I very much hope that restaurant, if one matriculates through to this property, ends up doing well. Historically hotel restaurants haven't done so well except perhaps in the Capital Hotel's case. However, the Capital Hotel is sort of Warren Stephens' play thing. It typically doesn't make money on an annual basis. I live in the Chenal area so for the sake of my neck of the woods, I'm very much hoping that the Aloft does well having to pay the hefty mortgage and hoping there's enough demand in the scattered office users and wider spread rooftops to support this $16M venture. To give some comparison to how much of an investment that is, the Embassy Suites built on Chenal Parkway back in the day came at a cost of $17M. It took seven different mortgages to accomplish that, with the smallest of those mortgages being a $300k loan to collateralize the small wares (plates, cups, silverware, etc.) needed to open the food and beverage operation in the hotel. The Embassy Suites was built in a much denser trade area with tons of offices and residents surrounding it with large amounts of convention space. Let's all hope the new Aloft can gather as much success.

I agree with you that there aren't any hotels in about a 3 mile radius. There's sort of a reason for that. There's not a ton of demand as there are limited office users. The office users that are present are somewhat scattered. The Aloft also isn't the Capital Hotel. It doesn't have a high end restaurant on property and it's just hotel brand. This is going to be a suburban Aloft location which historically haven't done as well as their urban city center counterparts. The Aloft in Rogers is a good example. There's not going to be a convention style aspect to the property. It's not going to be a resort. What are you left with then? It's just another hotel. Hotel guests are usually loyal to their system. Alot of the folks that were loyal to Starwood are now lumped into the Marriott system. That's not a bad thing. I'm a Marriott guy myself. But the Aloft location is so far removed from many of the main traffic drivers in the city. If I'm a Marriott guy there are alot of other options for me to get points and I may or may not want to drive all the way out just to stay at Aloft. Nike is leaving Promenade at the end of it's current lease option. They've stated that it's not feasible to have two outlet stores which they have better efficiency of the store at the Outlet Mall near Bass Pro. I believe they have 1.5 or 2 years left on their current lease term and will opt out at the end of the current one. I also asked some sources close to the deal with Ruth Chris taking over Del Frisco's and they're telling me the deal has stalled. They can't agree on how much of the current rent Del Frisco's is willing to subsidize for Ruth Chris. I'm hoping that they get something done here and Ruth Chris finally lands somewhere.

The Aloft has already started construction on the southern end of Bank OZK. It may be a traffic driver for people wanting to stay in an Aloft but the project is $15M with over 120 rooms. That translates to about a $90k/month mortgage. That is HUGE. You have to selling a ton of rooms every night to make any profits. It makes me a little worried because there's not alot of folks outside of the Downtown LR area that will spend $140/night to stay at a hotel no matter where in the city it is. It used to be that part of the allure of staying at Aloft was that there are not many Starwood Hotel properties in Little Rock besides the Four Points Sheraton in Midtown. But since Marriott bought Starwood, the Aloft brand has suddenly found itself amongst a bunch of sister Marriott properties. So it's not as significant to stay at an Aloft as it once was to get SPG points instead of Marriott points. The Aloft will also have to fend off the Tru by Hilton property that is going to be built in 2019 behind the Walgreens on Chenal/Wellington. Not many people know that the main cause of unsuccessful businesses in the Promenade (the list is long and distinguished at this point) is the highest rent factor in Little Rock in a shopping venue that has the least amount of traffic during certain seasons. It's not centralized in location and so it has to be a destination for some. I'll drive to Chenal if I'm elsewhere in the city to go to the Apple Store or the Nike outlet. But not Urban Outfitters or VS or any of the other stores that already have stores in Park Plaza, etc. Since the Nike outlet is going to the outlet mall by Bass Pro, there might be little reason to go to Promenade besides Apple.