New development underway
January 13-19, 2020
By Wesley Brown
Monde Group’s 41-acre mixed use, multi-stage community scheduled for opening in early 2021
Gov. Asa Hutchinson and a host of local and state dignitaries unveiled one of the first significant Opportunity Zone projects in central Arkansas with the official launch of the Esplanade District, a $20 million, 41-acre mixed-use neighborhood development in North Little Rock scheduled for opening in early 2021.
Hutchinson – on stage with Department of Commerce Secretary Mike Preston, North Little Rock Mayor Joe Smith, Little Rock developer Blake Jackson, and other local business, government and chamber officials – told a crowd of about 75 people at the groundbreaking that the river dale project is the first of its kind in central Arkansas.
“This is going to be a real showcase for our state, starting with residential living that is going to be so convenient to downtown and have such a beauty and atmosphere here,” said Hutchinson. “Secondly, we are here to make sure that we continue to expand the development of Opportunity Zones. This was a big decision for us, and we wanted to put the zones in areas that would invite development. Today, our 85 Opportunity Zones in Arkansas need more investment.”
In December 2017, the federal Opportunity Zone program was a last-minute addition to the $1.8 trillion Tax Cut and Jobs Act approved by Congress at the behest of Rep. Tim Scott, R-South Carolina. Under the omnibus tax plan, the Republican congressman urged President Donald Trump to support his initiative to spur investment in distressed communities across the country through a new federal capital gains tax incentive.
In April 2018, Hutchinson approved 85 OZs in Arkansas to provide tax incentives for private investment in low-income communities across the state. Out of the 337 qualified tracts, the state Economic Development Commission (AEDC) said those zones nominated more than a year ago were selected based on their potential for economic success and ability to attract investment.
Preston said although federal law does not mandate Arkansas and other states to keep a list of investment projects in the designated zones, AEDC is going to try to keep a matrix of ongoing developments in Arkansas.
“We’re just trying to rely on word-of-mouth from our community partners like North Little Rock where they have it,” said Preston, who also serves as AEDC chief under the governor’s newly reorganized cabinet structure. “We’re keeping a list of our own, but it is hard when you don’t have a requirement to do so.”
As of today, the U.S. Treasury Department has approved more than 9,000 “qualified opportunity zones” in all 50 states that will retain the “OZ” designation for a decade. Investors can defer tax on any prior gains until no later than Dec. 31, 2026, so long as the profit is reinvested in an IRS-qualified fund that targets the designated census tracts. Also, if investors hold the investment in the fund for at least ten years, they are eligible for an increase in its basis equal to the fair market value of the investment on the date that it is sold.
Located adjacent to the Arkansas River by the neighboring Rockwater Village and Riverside at Rockwater flats, the first phase of the Esplanade project includes the construction of luxury apartment homes that will feature 92 one- and two-bedroom units, all with private balconies or patios.
“Esplanade will offer a unique living experience unlike any other in central Arkansas,” said Jackson, managing partner at the Monde Group. “In addition to our premier valet services and enhanced security features, our property will also feature a spa, fitness center, bicycle lockers, beach, swim-up bar, entertainment and lush gardens.”
Jackson said the Monde Group plans to spend about $20 million in developing Esplanade. Over the next 10 to 15 years, Jackson said his firm envisions creating a lively community that blends restaurants, bars, and specialty shops with condominiums, single-family residences, and a boutique hotel. Costs for the next stage of the multi-phase community development is unknown, he said.
“We really see Esplanade as the first step on a new path to modern living in central Arkansas,” he said.
In answering questions from reporters after the groundbreaking ceremony, Gov. Hutchinson said he was pleased with the pace of investment in the 85 Opportunity Zones chosen out of 337 census tracts across the state. Besides North Little Rock, there are 16 qualified OZ census tracts in central Arkansas, stretching from Jacksonville to downtown Little Rock.
In August, Little Rock Mayor Frank Scott Jr. and U.S. Rep. French Hill, R-Little Rock, held an all-day summit with White House officials to discuss ways to boost investment and close new business deals in the designated zones. A week later, Mayor Scott named 20 local volunteers to serve on the city’s Opportunity Zone Task Force to come up with ideas to boost investment in the city’s four urban OZ census tracts.
Outside of Northwest Arkansas, only a few of the 85 rural and urban OZ communities across the state have come forward with fully developed plans to attract outside investment. Pine Bluff, which also had four OZ districts and plans for a $350 million casino and hotel gaming complex, has also created a task force in February to streamline investment into the Jefferson County city.
“I think selection, deployment, and interest of those (zones) are right on target,” Hutchinson told the Daily Record. “We are competing with other states in terms of these investment dollars, so I have asked Secretary Preston to look for ways we can enhance the knowledge base for those areas and we’re going to continually work to attract investment.”
PHOTO CAPTION:
1. Gov. Asa Hutchinson (left) shakes hands with North Little Rock Mayor Joe Smith at the groundbreaking dedication of the $20 million Esplanade District. (Photos by Randall Lee, photographer for the Office of Gov. Asa Hutchinson)
2. Local and state chamber, government and business officials join Gov. Hutchinson (Center right) and North Little Rock Mayor Joe Smith (Center left) at the groundbreaking ceremony of the Esplanade District, a planned 41-acre, mixed-use luxury apartment complex on the banks of the Arkansas River. The multi-stage project is being led by Monde Group of Little Rock.
