In May 2015, at ICSC in Las Vegas the Caraway Plaza (160,000/SF shopping center) ownership group requested a meeting with Halsey Thrasher Harpole regarding their Jonesboro property. The first challenge was securing new financing for a loan that was maturing in January 2017 with a pay off in April 2017. Another challenge was vacancies. The major anchor tenants leases were expiring in the next 24 months and there was already a large amount of vacancy in the center. There was a vacant restaurant out pad and a vacant bank out pad which blocked visibility to the center. There was an extensive amount of deferred maintenance that needed to be addressed. Last, but not least, was the fear that Hastings, one of the anchor tenants, would be filing bankruptcy that became a reality.
The shopping center is located in the northwest corridor of the retail district. Halsey Thrasher Harpole believed this to be an opportunity to re-lease and re-energize this center. Tenant rental rates were competitive and the cost of new construction at a different location was not economical.
A big concern that later came to be a reality was that three corners of Highland Drive and Caraway Road would be on the market with the exit of Sears, K-Mart & Coca Cola putting the higher traffic corners in play. Halsey Thrasher Harpole had to secure this shopping center before those vacancies occurred.
The Caraway Plaza ownership group recognized the need for local knowledge with key relationships with national retailers and local government. They needed a team who could lease and manage the property and oversee the various construction projects that would be ongoing over the next 24 to 36 months. They chose Halsey Thrasher Harpole Commercial Real Estate who immediately went to work leveraging working relationships with those tenant representatives, surveying the market, and analyzing opportunities within the center to decrease vacancy. In addition, the ownership group requested Halsey Thrasher Harpole find local financing with limited/non-recourse for both construction and permanent financing.
Upon being retained by the Caraway Plaza ownership group, Halsey Thrasher Harpole deployed their team and the results were better than ownership expected.
• Hastings was replaced with Natural Grocers and a 15 year lease.
• Rack Room was downsized into a smaller vacant space with a new 10 year lease.
• Old Navy was moved into Rack Room’s space by demolishing the back wall and extending the space and securing a new 10 year lease.
• The larger Old Navy space was backfilled with HomeGoods.
• Merle Norman and Hallmark committed to a 10 year lease absorbing 8,500/sf of vacancy on the north end of the center.
• The former bank branch and restaurant sites were razed to make room for a new 13,000/sf retail center.
• A local community bank made a new loan for the ownership group.
“Halsey Thrasher Harpole manages one of our larger shopping centers and has been in charge of our re-tenanting, remodeling and new construction in Arkansas. They have proven to be relentless in their pursuit of success; and have shown to represent our interests even above their own when it comes to tenant leasing. Their development and construction team have consistently produced ahead of schedule and at or below budgets. We could not be any happier with our partnership.”
—Martin Ensbury, Managing Partner of Caraway Plaza ownership group