Arkansas State University has long served to help drive retail activity in Jonesboro. Businesses located in northeast Arkansas benefit from the college having nearly 13,000 students enrolled on campus.
Does ASU have the potential to become a commercial hub itself?
Currently the university is working to attract retailers to 26 acres of land owned by Arkansas State.
About seven years ago, the college attempted to sell the land but found no takers for the price it was asking. Since then, millions of dollars in commercial development have happened to the south and northeast of Red Wolf Boulevard in Jonesboro. Developers have begun to notice that there is potential between those two thriving areas.
School officials said they have been unable to determine how long the school has owned the land, but they have come to the conclusion that it is doing them little good continuing to sit empty. As universities see funding cut, they are looking for potential revenue streams and commercial development offers an intriguing possibility for Arkansas State.
"We're interested in leveraging our assets," said Shawnie Carrier, chief of staff at ASU. "We're land rich and we see this as a way to generate revenue we need to make up for flat funding. Right now the market looks positive, so the time is right, right now."
Helping Arkansas State leverage those assets is Haag Brown, the broker/developer firm responsible for much of the development in Jonesboro for the past five years. Haag Brown now is acting as an exclusive consultant for Arkansas State and will be the broker of record for any deals that close. Consulting work is earning the firm between $900 and $1,000 a month and closings will generate a fee of either 3 percent or 6 percent, depending on what other brokers are involved.
Haag Brown co-founder Josh Brown sees the potential for $30 million to $40 million in development on the 26 acres. That total was figured by combining land value and potential construction costs.
Since the firm was formed in 2010, Haag Brown has been responsible for nearly 30 national retail and restaurant developments in Jonesboro. That sort of track record suggests the firm knows how to get deals done, but it also begs the question: What's left? How many more chain restaurants or shops does the town need?
Brown is used to the questions. In fact, he said, it's a conversation he often has at home.
"My wife asks me all the time what happens when you run out of stuff? It's a really good question," Brown said. "What's easy to answer about this property is that some of it will be used as people's second location in the market."
No deals are officially done, but Brown hints at several possibilities, including second locations for restaurant chains and a bank branch for a bank looking for a north Jonesboro location. Ideally, Arkansas State would serve as the lease-holder for any development on the 26 acres. That would yield the most revenue, but selling acreage to restaurants or retail outlets isn't entirely out of the question.
Look around the state for examples of varying degrees of commercial development on prime university land. At the University of Arkansas, the school operates a retail space with a bank, a tiny Wal-Mart, a campus bookstore and other commercial ventures. Hendrix College in Conway has a mixed-use space that has become one of the more popular spots in town for locals to take visitors.
The Village at Hendrix is a model for what Brown would like to see at Arkansas State. Built on 92 acres, the development includes housing and retail. ASU's development won't be quite to that scale, but Brown said it is a prime example of how an on-campus development can be good for the university and town.
"When you visit Conway, it's a place the mayor is going to take you," said Brown, who toured the Village at Hendrix on Thursday. "We hopefully have an opportunity to do something like that at Arkansas State. That's a project we don't have. I have a really good idea of where it needs to be."
SundayMonday Business on 12/14/2014