Condo Mania in NW Arkansas--How Many is Too Many?

The debate has now been settled over whether the Divinity Hotel and Condos project can become reality. The newly-approved Divinity development has roused much controversy because of its size and scale in comparison to existing buildings in central Fayetteville. Its plans call for 30 condos and 137 hotel rooms above commercial space and restaurants.

A few years ago there wasn't a condo for sale in Fayetteville but that changed rapidly as developers began turning everything available into condos in central Fayetteville.

With the new mixed-use zoning plan expected to be approved soon, city planners anticipate turning Fayetteville into a "real city" with shops and commercial entities on the first floors of some of the new construction buildings, with condos upstairs.

There is already one large building under construction behind Dickson Street, and many older buildings have been already turned into condos, including the UArk Bowl, St. Joseph's Catholic Church and School, and others in the Dickson Street area.

Thanks in part to tax incremental financing (TIF), the abandoned Mountain Inn has been demolished and a new building has been approved for the site, conforming to the city's new guidelines. It will be known as the Renaissance building and its 18 stories will house a Marriott Hotel and condos.

The 9-story Lofts at Underwood Plaza is another new condo project located right on the square in Fayetteville. And the Legacy building is already underway, bringing 37 new condos to the Dickson Street area.

In addition, an apartment complex behind the NW Arkansas Mall (formerly Bristol Gardens, now called the Reserve at Steele Crossing) has gone through a condo-conversion and sales are underway. And there are new condos on Zion Road east of the mall for sale.

The problem is that land prices, especially in town, have risen so high that these condos are undoubtedly for an affluent group of people. The latest project to come before city planners calls for 20 condos, retail space and parking on a piece of land that is less than 1 acre in size. The land and existing building, which will be demolished, sold this year for $980,000.

Condos currently on the market in central Fayetteville are listed at close to $200 per square foot—certainly not for the average working person. Granted, many retirees who might be downsizing may have the money to pay these prices, as may some young, well-paid professionals who want to be within walking distance of restaurants and nightlife on Dickson Street.

I'm not arguing with the concept proposed by the planning commission--a vibrant center city where commercial entities are within walking distance. It's just that it seems that no one has asked the question, "will there be too many condos as a result"? Can Fayetteville's population absorb this large number of expensive multi-family units downtown?

A similar pattern is occurring in Benton County. Many condo complexes are being constructed in Rogers, and a development calling for three 15-story condos has been proposed for the shores of Beaver Lake. Much opposition has occurred for this project, leading to a question about what kind of development should occur near the lake.

A lesson could be learned from the folks in the Lake Tahoe area back in the 70s and 80s as lakefront condos proliferated. The pristine natural beauty was destroyed in some places due to lakefront condo complexes.

If you are concerned about condos, building heights, lakefront development or any other aspect of life in NW Arkansas, I urge you to make your voice heard. Stay informed, go to meetings, and take a stand. Your opinion counts.

For more information:

http://www.nwarktimes.com/nwat/News/42328/

http://www.nwarktimes.com/nwat/News/41377/

http://www.nwanews.com/adg/Business_Matters/153398/

http://www.nwanews.com/nwat/News/42544/

http://www.nwarktimes.com/nwat/News/42366/

http://www.nwaonline.net/articles/2006/07/01/news/01bzcondosuit.txt

http://www.gill-law.com/assets/pdfs/Article_TIF%20Financing%2007%2008%2004.pdf#search='mountaininnfayetteville'

GROWTH - Outward or Upward?

OUTWARD GROWTH is the current norm along the Interstate 540 corridor in Benton and Washington counties, and this worries some city planners and elected officials. They want to see developers build upward, filling in existing city space with denser developments such as multistory apartments.

Dense, upward development leads to more people living per square mile, less cost to the cities to provide water, roads and other services, and less need for outward development of rural land, said Steve Luoni, director of the Community Design Center in the School of Architecture of the University of Arkansas at Fayetteville.

But people have been slow to embrace UPWARD GROWTH according to Fayetteville’s Senior Planner Jeremy Pate, “It’s going to take a while to slow down outward development. People want to live at the end of a cul-de-sac.”

Developers say they are building houses outward from the cities instead of upward with denser apartments and condominiums because that’s what people want and that’s where they can make a profit. They built 36,201 new housing units in the four major cities from 1990 to 2004. About 63 percent of those were single-family dwellings, according to statistics from the Northwest Arkansas Regional Planning Commission.

“Primarily, that’s what the market demands. People don’t want ‘up’ — not around here,” said Gary Brandon, who is building several subdivisions on the western edge of the I-540 corridor, including one of 117 acres between Lowell and Cave Springs and another of 54 acres on the outskirts of Tontitown. “They’re not that keen on condos yet.”

Kathy Deck, associate director of the UA Center for Business and Economic Research, said the growing population will continue to demand homes on the outskirts of town. Condos will not appeal to families until the price of gasoline becomes too high or traffic becomes too congested to commute from outlying communities, she said.

Richard Alexander, a developer of condominiums and mixed-use buildings in central Fayetteville, would agree. He said his market is based on the downtown location of the projects and will appeal to people because they won’t have to drive to go shopping or to the university. “There is that niche looking for a lack of a commute,” said Alexander.

Even though cities are spreading, some officials say the finite supply of land and market forces eventually will make upward growth the norm in Northwest Arkansas. “Our land space is dwindling,” said Rogers Alderman Mark Kruger. “At some point we will run out of space, and up will be the only way to go.”

For more information: http://nwanews.com/adg/News/147079/