A Starbucks coffee shop that has been a fixture in the Pulaski Heights neighborhood of Little Rock for a dozen years is scheduled to close Dec. 31, the owner of the property said Friday.
Lou Schickel, a real estate investor who acquired the property at Kavanaugh Boulevard and North Pierce Street shortly before the Seattle-based company began leasing it, said Starbucks had given notice in the past but always pulled back "at the last minute."
"But this time, it doesn't sound like they're going to do that," he said.
Starbucks didn't respond to an email seeking comment Friday afternoon.
Schickel said he suspects a factor in the decision to close the Heights location is it lacks a drive-thru window, which he said would help sales significantly.
"The story is over the years they do around $500,000 or $600,000 a year" at the Heights location, Schickel said.
By contrast, the Starbucks with a drive-thru at Cantrell and Sam Peck roads does $1.4 million annually, Schickel said. "And practically every store with a drive-in window does well over a million [dollars]."
Earlier this year Starbucks Chief Financial Officer Scott Maw used a conference call to promote a new corporate strategy emphasizing drive-thru stores to drive sales of its lattes and other items, according to Bloomberg.
Maw used as an example, two Starbucks shops in Fort Collins, Colo. One is in a shopping center and the other is in a nearby drive-thru location. Sales were two-thirds higher at the drive-thru location, Maw said, according to Bloomberg.
The strategy is the antithesis of the coffee shop culture that Starbucks once cultivated and that is one of the attractions at the Heights Starbucks.
"That Starbucks [is] kind of a neighborhood hangout," Schickel said. "It's kind of a shame."
He said he doesn't know whether Starbucks will open another location in the Heights.
"The best we can figure out is they're just closing that one and not moving down the street," Schickel said. "But we're not sure of that, either."
Meanwhile, Starbucks last month opened a new location at the bottom of Cantrell Hill on property that once was the site of a Shogun Japanese Steakhouse.
Bradford Square of Arkansas LLC, a West Plains, Mo., firm, invested $2 million to buy the property at 2815 Cantrell Road last month from East Cantrell Development Group LLC.
The building was appraised at $446,000 this year. It was built in 1971.
Bradford Square of Arkansas borrowed $1.6 million from Springfield First Community Bank of Springfield, Mo. The maturity date of the mortgage is 2038.
Mark L. Dake and Kimberly S. Dake, each of whom is manager of Bradford Square of Arkansas, signed the mortgage. Merritt Dake is the registered agent of Bradford Square of Arkansas.
The new Starbucks, Schickel noted, does have a drive-thru window.
He said he doesn't expect the property on Kavanaugh to be vacant long once Starbucks leaves, but he doubts that a new coffee shop will take its place.
"Numerous people are looking at it already," Schickel said. "It'll rent very fast.
"We're calling the different coffee shops. They're not the people that are calling us. We're getting other retailers up and down the street calling us. They like it here because it's got a little bit of parking."
Information for this article was contributed by David Smith of the Arkansas Democrat-Gazette.
Business on 11/17/2018