FAYETTEVILLE — Richard Alexander earned a reputation for his deft touch at renovating historic properties and making them profitable.
But the easygoing developer and real estate mogul is also known for his involvement with a giant hole in the ground downtown — site of a planned high-rise, luxury hotel that never came to be because of the real estate crash that hit Northwest Arkansas three years ago.
Before his failed attempt to build the 200-room Renaissance Tower, Alexander had been labeled a visionary. For decades, he worked with city and chamber organizations intent on shaping Fayetteville’s downtown and Dickson Street district into an entertainment and dining destination.
As early as 1997, Alexander tackled smaller and highly successful projects, such as renovating the Ozark Theater on College Avenue.
In 2001, there was the Inn at Carnall Hall, developed from a historic women’s dormitory on the University of Arkansas campus. That same year, Alexander put his law practice on hold to work full time as a developer and real estate broker.
The financial crisis began in 2007, sending real estate values plummeting and scuttling some of Alexander’s largest and most ambitious projects. He’s since been busy renegotiating with creditors and extricating himself from deals gone sour.
In December, ANB Ventures — created by the Federal Deposit Insurance Corporation to handle more than 1,000 loans of the failed Arkansas National Bank — purchased The Cosmopolitan Hotel out of a foreclosure action. Alexander and partner John Nock owned the downtown Fayetteville property and saw their renovation plans halted in midstream when federal regulators shut down ANB in May 2008. The borrowers originally obtained financing from the defunct, Rogers-based lender.
Alexander also remains an investor in The Lofts at Underwood Plaza — a high-rise condominium and retail development in Fayetteville. Arvest Bank sued project investors in October, claiming they’re in default on a $22 million loan.
In September, Alexander and Nock turned over SouthPass, a 900-acre development with residential, commercial and park property, to project lender Chambers Bank.
The proposed 18-story Renaissance Tower project appears to be a distant memory. The pit at Mountain Street and College Avenue that would have held the tower’s foundation was filled and paved over in 2009.
It’s now a parking lot.
Dan Coody, a two-term Fayetteville mayor first elected in 2000, said the economy turned many successful developers into victims.
“Developers are a four-letter word in Fayetteville, and a lot of people didn’t like Alexander and his team,” Coody said.
“But for what they did,” he said, ticking off several projects, “they did a good job, and if the economy hadn’t have collapsed, I think they’d still be rolling along.”
In spite of the downturn, Alexander has avoided personal bankruptcy, a testament to his ability to pick his partners well, associates say. He’s still selling real estate in the beleaguered market through the full-service AMA Real Estate Group, which stands for Alexander, Merry-Ship and Alt.
Alexander declined to be interviewed for this story.
Traveler, Lawyer, Builder
Friends and colleagues say Alexander’s trademark Hawaiian-print shirt is a clue about his overall disposition. Most describe him as “laid back.”
A native Kansan raised in the Maryland suburbs of Washington D.C., he made his way around the globe twice by age 24.
Alexander said in earlier interviews with the Arkansas Democrat-Gazette that while he traveled, he worked odd jobs as a taxi driver, wine steward, hotel bellhop, clothier and trash hauler.
But in 1976, a piece of property that was the right price — cheap — encouraged him to put down roots in Northwest Arkansas.
Alexander shelled out $40,000 for 160 acres in northwest Benton County with the intention of starting a blueberry farm. The purchase provided his first opportunity to renovate a run-down structure: a one-level building without electricity or plumbing.
Alexander reported living in what he called the “chicken shack” with his wife while they obtained degrees at the University of Arkansas at Fayetteville during the early 1980s. He studied political science as an undergraduate, then attended law school.
“I went to school for eight years to get a couple of degrees,” Alexander said in earlier interviews, “but I got my education traveling.”
Longtime associate Greg House said the two met in 1973 at a sailing center in the Ala Wai Harbor in Honolulu, then he came to Arkansas in the early 1980s as a result of their friendship.
House, too, attended college, then law school after coming to Fayetteville. And he practiced law with Alexander for a short time before returning to his roots in the building trades.
“Richard was a lawyer and if he’s got someone to blame for getting him into real estate, it was me,” said House, who operates Houses Inc., a real estate and property management firm in Fayetteville. “I was a builder and practiced real estate and said real estate would be more fun.”
An early 1990s downtown revitalization effort in Fayetteville caught the interest of both men. By then, House said, he was already well experienced with real estate cycles, having lived through similar boom-and-bust periods in Hawaii and California.
“We felt like maybe it’d be a good bet, and so we started buying pieces that were around,” he said. “But we didn’t think we could afford Dickson Street.”
The two men renovated properties on nearby Spring Street — mostly older homes and office conversions — and later split their business.
“Richard focused on the square,” House said, and “for a while I think he owned two-thirds of the square.”
Refilling the hole
The zoning and building permits for the Renaissance Tower expired in December. Alexander and Nock proposed building the downtown boutique hotel in 2005 to replace the Mountain Inn, an unoccupied and blighted motor lodge that sat on a high-traffic corner on College Avenue.
The partners planned a September 2007 opening, but the Marriott-affiliated project kept growing and evolving.
Convention and athletic facilities and a ballroom were added to plans, and the partners bought five more adjacent parcels on nearby Center Street.
“Our initial prediction of being open in ’07 was based on a $22 million project,” Alexander told the Northwest Arkansas Times in September 2007. “It’s grown exponentially since then. Now it’s a $70-$80 million project, and it encompasses an entire city block.”
Calls to Marriott headquarters seeking comment for this story and details about the hotel deal were not returned.
Nock and Alexander met in late 1999. At the time, Nock was working as an investment banker representing Stella Moga, owner of the Mountain Inn. Moga, a day-care operator from Ohio, had hired Alexander as a property manager for the vacant structure, Nock said.
“The biggest eyesore in the whole downtown was the Mountain Inn,” said Nock, who continues to believe that if the real estate market improves, the Renaissance Tower will be built. “Many tried to [turn around the property] and failed.”
Alexander and Nock worked closely with Coody, the former mayor, and city government on the first stage of the project — removing the Mountain Inn building and some adjacent structures.
Aldermen in 2005 created a tax increment financing district to establish a revenue stream to pay the $3.7 million demolition bill.
The special tax district freezes allocations for various taxing bodies from a defined group of taxpayers and funnels any future tax increases toward paying off redevelopment costs. The TIF district will be in effect until 2029, when the municipal bonds that paid for the purchase and demolition of properties related to the Renaissance Tower are paid off.
City officials contended at the outset that even if the hotel failed to materialize, the elimination of the Mountain Inn would be an improvement. The public and business owners complained that squatters made their homes in the abandoned building. Demolition began in May 2005 and was complete three months later.
Construction workers then excavated the hole for the foundation. But work stopped and accumulated rain turned the site into a breeding ground for mosquitoes, detractors said. A 280-foot crane was erected in November 2006. The crane sat idle for more than a year, overlooking the 10-foot-deep cavity that occupied a significant corner portion of the parcel bounded by Center and Mountain streets to the north and south and College Avenue and East Street to the east and west.
In late 2008, Alexander and Nock obtained permission from the city to fill in the hole and construct a parking lot, still contending the project was not dead.
The developers paid a little more than $300,000 in penalty payments to the city for not making deadline on construction of the hotel. The parking lot will remain unless another project comes along, said Jeremy Pate, director of development services for the city.
Because the development was specially zoned, the property owners must seek out new zoning permits after the building plans expired Dec. 20.
“The silence [from the developers] is an indication that they’re not going to seek out another extension,” Pate said late last year.
changing while preserving
Several preservationists and community members point to Alexander’s earlier successes as the projects that will define his legacy.
He began renovating dilapidated structures in 1997. The Ozark Theater, originally built in 1904, was his first high-profile project.
The revitalization of the former opera house, and later movie theater, further galvanized the city to take notice of its historic architecture after the UA’s iconic Old Main was restored in 1991.
When city officials considered demolition of the Ozark Theater in 1993, the community took action, said Jonathan Story, an architectural buff and local real estate agent. Story, then 12, collected 350 signatures to save the building.
The College Avenue theater played host to notables such as statesman William Jennings Bryan, former President William Howard Taft and boxer Jack Dempsey, Story said.
Alexander and partner Rob Merry-Ship in late 1996 bought the building from the city for $20,000 and invested nearly $1 million to renovate it.
Story said his impression of Alexander at the time was that “he was some kind of hero.”
The theater’s renovation has been a catalyst for a lot of downtown revitalization that Fayetteville has seen in the last 15 years, Story said, and it “would not have come to fruition without his [Alexander’s] investment and his vision.”
The project also wove Alexander more tightly into the city’s community fabric, since he worked closely with the late John Lewis, a Fayetteville patriarch.
Lewis, who founded the Bank of Fayetteville in 1987, earned the nickname of “Mr. Fayetteville” because of his relentless promotion of the city.
Alexander’s reputation also was bolstered by the restoration of Carnall Hall, a 19th-century building that was the university’s first women’s dormitory.
The three-story facility had languished, boarded up and unused, for nearly a decade before Alexander won a bid to restore it in 2001.
His team for the project included partner Merry-Ship; James Lambeth, the late architect and owner of the Inn at the Mill in Johnson; and chef Miles James.
“They also had some successful track record in doing some historic preservation and adaptive reuse, which we thought brought a lot to the table,” recalled David Martinson, the university’s contact for the Carnall Hall project.
Saving the dormitory became a personal cause for Paula Marinoni, a local preservationist and executive real estate broker with Coldwell Banker, Harris McHaney & Faucett.
Upon returning to Fayetteville in the fall of 1995, “One of the first things I saw needed help was historic preservation,” Marinoni said. “Alexander was involved in that at the time.”
Marinoni said she found an ally in Alexander, since both could look at any aging building and see the potential for beauty.
He also had the ability to figure out the finances, she said.
“Alexander knows the other side of a project, and he has the ability to work the numbers,” Marinoni said. “He also understood the marketing and desirability and what was needed to make cash flow.”
No one looked at historic properties as moneymakers, so when Alexander turned a few projects into financial successes, people took notice.
“It was exciting,” Marinoni said.
Savvy real estate developers recognize that preservation projects are actually economic development projects, said Ethel Goodstein-Murphree, a professor of architecture at UA.
And it’s hard to argue for rescuing a building that can’t provide a function, she said.
“If we don’t think about that side of the picture, we’re not going to succeed in protecting our historic buildings,” Goodstein said.
The restoration of the Ozark Theater is second only to Carnall Hall in terms of local preservation, she said, adding that Northwest Arkansas doesn’t have many buildings dating back 100 years.
Alexander “found a comfortable edge where a building can be afforded a promise of a new, extended life by the identification of new uses that enable them to make economic contributions to the community,” Goodstein said.
Alongside his involvement with the Ozark Theater, Alexander participated in the Downtown Dickson Street Enhancement Project.
The nonprofit group formed in 1995 to improve the public areas around Dickson Street from College Avenue west to West Avenue.
Certain parts of Fayetteville’s entertainment district needed a makeover after the Walton Arts Center opened in 1992, said Bootsie Ackerman, former executive director of the group.
Alexander regularly appeared before the City Council, since he was the spokesman on certain projects, she said.
“I think it’s rare for people to grasp restoration in the way Richard does,” Ackerman said. He has “such an eye for historic renovations and he understands the value of roots and beginnings.”
Alexander’s knowledge of preservation and his vision for saving the history of Fayetteville helped shape downtown, said Ackerman, who headed the Dickson Street group from 1995 through 2004.
Ackerman credits Alexander’s vision as being good not only for his own projects, but for the whole of downtown.
“Everywhere you look [in Fayetteville] you can see his fingerprint,” she said.
Big bets, Bad timing
Developers agree that turmoil in the nation’s financial system is to blame for the crash of the real estate market and its ongoing woes.
By 2007, Alexander already had placed his bets on a slew of projects including the Fulbright Building on Dickson Street; Cosmopolitan Hotel; East Square Plaza, also known as the Bank of America building; E.J. Ball Building; and Center Court Square on Center Street.
The troubles related to the real estate market are a sign of the times and “to see hardship hurts me personally, because I know where these guys’ hearts and minds were,” Ackerman said.
Alexander’s unfinished projects will be successful for someone else, she predicted, adding that “Timing is everything. Timing is critical.”
Alexander’s participation in The Lofts at Underwood Plaza on Dickson Street didn’t pay off. Other investors in the completed, nine-story, mixed-use development included Ted and Leslie Belden; Alexander’s wife, Jennifer; Rob and Kathy Merry-Ship; Bill and LeAnn Underwood; and Craig and Laura Underwood.
Bill Underwood told the Northwest Arkansas Times that the 20 unleased units in the building likely will be managed by a court-appointed receiver until the property is sold as part of a foreclosure action.
Underwood said the project was hamstrung by a slow economy and construction delays.
The Fulbright Building, the city’s former library, represents another Alexander project that went astray. Friends say it ranked among his personal favorites.
A group that included Alexander bought the property for $1.2 million in June 2004, then completely gutted it. But by February, the lender filed a foreclosure suit, scattering the original investors.
The matter was settled out of court this year.
The only original investors to remain are John Tyson of Tyson Foods, Inc. and Ted Belden, owner and partner in Old Buildings LLC, a Fayetteville business that specializes in property rehabilitation. Alexander, Merry-Ship and Nock negotiated the release of their ownership portion.
Sheree Alt of AMA Real Estate Group Inc., the firm equally owned by Alexander, Merry-Ship and Alt, said Alexander is a great businessman and that, unfortunately, one or two of his projects fell by the wayside.
The projects failed because of the economy, Alt said, not because of Alexander.
A weak economy also doomed SouthPass, Alexander and Nock’s gigantic mix of residential, retail and parks in southwest Fayetteville. The project that was conceived in 2004 never moved much past the planning stage.
Danville-based Chambers Bank said it plans to proceed with the development, including 4,000 homes and 344,000 square feet of commercial and retail space, the Northwest Arkansas Times has reported.
“I don’t think he [Alexander] thought it [the real estate market] would turn out the way that it did,” Belden said.
A love of historic buildings brought Belden and Alexander together and likely will keep their relationship going.
They teamed up to renovate buildings including the E.J. Ball building and One East Center, both in downtown Fayetteville. Alexander is no longer an investor/partner in One East Center, clarified Belden, who continues sorting out stalled deals and who originally intended to be a minor, passive investor in certain projects.
“Now, I’m a majority, active investor due to changes in the real estate market,” he said.
Initially, Alexander did have some of the capital he needed to finance projects but wound up turning to Nock on some of the other deals, said Belden.
“He can only do what he can do, which means negotiating deed in lieu of foreclosures, so that he doesn’t have to go through personal bankruptcy,” said Belden, describing the process where a borrower releases all rights of ownership to a lender in order to avoid foreclosure.
Avoiding bankruptcy allows Alexander to sleep at night, he said.
“He’s dealt with all his problems and been forthright with the banks,” said Belden, who has been able to weather the recession only because his family runs a manufacturing business in central Arkansas.
Nock said his business partner possesses an integrity that’s helped him cope in the downturn.
“I’d not bet against Richard Alexander and his ability to overcome obstacles and adversity,” he said.