Deal signed to sell Indian Mall
Jonesboro Sun
Mark Randall
8/7/2007
JONESBORO — A major Jonesboro developer has entered into a contract to buy the Indian Mall but said the deal is contingent upon the city guaranteeing it won’t hold up necessary permits.
Partners Bruce Burrow and Marty Belz of MBC Holdings LLC said they have a deal with the Warmack family to buy the venerable landmark and will spend the next 60 days studying the property and working out the details.
“We have not closed on the property,” Burrow said, “but we are hopeful we can get something done. We’re going to go through our due diligence until we know the city will work with us. If all goes well, I think we will bring a lot of jobs, a big sales number annually and a really neat property to that location.”
Burrows did not release details of the sale, but the 378,000-square-foot 32-acre property was listed at $15 million.
The Indian Mall was the first of its kind in Arkansas when it was built in 1967 and drew shoppers from across Northeast Arkansas and Southeast Missouri. The mall has been mostly empty of stores and shoppers though since The MALL AT TURTLE CREEK, which was developed by Burrow, opened in May 2006. Only a Sears store and Dillard’s clearance center remain open.
Warmack & Co. was once a successful commercial developer with malls in 12 states including the 966,000-square-foot Central Mall in Fort Smith and 568,000-square-foot Central Mall in Texarkana, Texas, but the family has since been selling off its mall properties.
At one time Warmack had plans to build a $55 million 961,000-square-foot mall to replace Indian Mall on a 139-acre site on the corner of Keller’s Chapel Road and U.S. 49 but was beaten by Burrow in the race to construct a new shopping center.
Belz said firm plans to tear down the existing mall and redevelop the site into a lifestyle center similar to The MALL AT TURTLE CREEK with as many as four major tenants, three of which would be new to the Jonesboro market at a value in excess of $50 million.
“We believe we will end up tearing down a lot of the existing center and rebuilding it,” Belz said. “We haven’t put anything on paper yet. But that is our plan.”
If the deal is completed, the development could bring 700 new jobs and $70 million in annual sales.
Burrow said they have not hired an architect to design a plan yet. A lot will depend on how they work around the 80,000-square-foot Sears store, which still has a multi-year lease on the property.
“They have a lease for a couple of more years to go yet,” Burrow said. “We’re working on that.”
Burrow said MBC has two or three large tenants who they couldn’t be accommodated at The MALL AT TURTLE CREEK and who are interested in locating at the new property. The MALL AT TURTLE CREEK is anchored by J.C. Penney, Dillard’s and Target, and smaller anchors Barnes & Noble, Circuit City and Bed, Bath and Beyond.
“This is the obvious place for us to get it done,” Burrow said. “We see a nicely landscaped high-end kind of development, something along the lines of Turtle Creek, that makes a statement and will be bigger and better for the community.”
The only potential snag that could hold up the deal is the City of Jonesboro, he said. Burrow said the deal will depend on whether the city is willing to work with him to make it happen.
He cited a disagreement with Mayor Doug Formon over the development of The MALL AT TURTLE CREEK and the Kohl’s Center.
Burrow took exception to the city’s handling of notifying property owners near The MALL AT TURTLE CREEK that they were no longer in the flood plain.
“We had spent a lot of time and money saying that when we got the development done we felt there would be 400 to 500 homes to come out of the flood plain,” Burrow said. “That, in fact, was the case. But for some reason the city would not move forward telling these people that according to the revised FEMA map that they didn’t have to have flood insurance. That doesn’t mean they shouldn’t have it. It just means they are no longer required to have it.”
Burrow also said the city threatened to hold up issuing a certificate of occupancy for Kohl’s unless he did additional drainage work that MBC wasn’t required to do initially.
“We will never do a deal again where the city can put us in a position of holding up a certificate of occupancy,” Burrow said. “I never thought I’d be in that position. But the last couple of deals have made us real skittish. We’re not going to spend a lot of money on the design until we sit down with the city and see if they will work with us.”
Formon said he welcomes the chance to sit down with Burrow and pledges to do all the city can to help the deal move forward.
“There’s nothing to straighten out,” Formon said. “We’re happy with Mr. Burrow, and we want to make sure everything goes smoothly for him so he is able to build in Jonesboro. We’re willing to work with Bruce in any way, shape or fashion and would love to be able to participate in some level in the development.”
The Jonesboro-based MBC Holdings is one of the region’s largest commercial property developers specializing in shopping centers and hotel properties.
Burrow said he is containing his excitement about the deal until he hashes out his differences with the city.
“Normally this would be a great day for me, and I would tell you it is a done deal,” Burrow said. “But until we sit down and work with the city and through some issues we have raised during out last couple of developments, we won’t go ahead. We’re not going to go through this situation we did in the past. If we do, then you will have to get somebody else to develop it. I hope we can work through it and get the project done because it will be great for the community.”
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