The City of Little Rock will purchase the Cromwell building downtown for $3.35 million for the Convention and Visitors Bureau.
The Bureau has been renting the fourth floor of the building for $155,000 annually since its employees were displaced from their offices in Robinson Center to allow for renovation.
The Little Rock Board of Directors voted 9-0 Tuesday night to purchase the property for the bureau.
An original version of the ordinance had the Advertising and Promotion Commission -- which oversees finances and operations of the bureau -- using its general fund to purchase the building by financing most of the cost through the city.
But state law limits the use of buildings owned by an Advertising and Promotion Commission to advertising and promotion matters, City Attorney Tom Carpenter said. So it was decided the city will purchase the building and work out with the commission how its use and payment will be divided in coming months.
The city, for example, could eventually use some of the space to house city offices. If it did that, it would pay for using that portion of the building. But for now, the current leases in place for the space will be honored. Current tenants include a law firm, a construction company and Cromwell architects. Some have plans to move out at the end of the year, but lease agreements allow Cromwell to stay for another two years, said Gretchen Hall, president and chief executive officer of the bureau.
A decision on when and how the commission will reimburse the city hasn't been made.
At one point at Tuesday's city board meeting, At-large Director Joan Adcock asked City Manager Bruce Moore if the Advertising and Promotion Commission would pay back the city for all costs associated with taking out a five-year loan to purchase the building. Both Moore and Carpenter said the city would be paid back in full, but then Carpenter later pulled away from that statement and said he didn't know and it would depend on how the building is used.
The Cromwell building has been on the market for a while, and the Convention and Visitors Bureau's lease had a right of first refusal clause that allowed them the option to buy the building in the event an offer was made.
That happened when the Bank of England offered $3.35 million for the property in July.
Hank Kelley of Flake and Kelley Commercial told the commission that ownership of the building could result in $4.88 million in revenue over the next 20 years.
Hall told commissioners last month that if the commission did not buy the building, the organization would spend about $4.3 million in rent over the next 20 years, starting with its current annual lease rate of $155,000.
Information for this article was contributed by Chris Bahn of the Arkansas Democrat-Gazette.
Metro on 09/07/2016