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Lost contracts bring change among top property firms. (List Overview).

BARNES QUINN FLAKE & Anderson of Little Rock retained the No. 1 spot among the largest commercial property managers in Arkansas and increased its total square feet managed from more than 5.3 million SF to more than 5.5 million. The gain reflects the addition of several properties.

Climbing up the list from No. 3 to No. 2 is Cooper Realty Investments Inc. of Bella Vista. Two variables came into play in Cooper's move.

First, the company's total square feet increased from more than 3 million SF to more than 3.8 million SF.

The gain came from properties that were overlooked last year. Likely candidates tied to the omission are two east Memphis office buildings acquired in joint ventures with Arkansas Teacher Retirement System last year -- the 340,000-SF Crescent Center ($38.56 million) and the 162,000-SF Forum I ($16.5 million).

Cooper also took over the management chores of 15 Conway properties, a 300,000-SF mix of office, retail and warehouse space. Those projects were managed by the previous owner, Nabholz Properties Inc.. (No. 17 on the list), which registered a corresponding drop in its square feet total.

The final factor at work was that Flake & Kelley Management Inc. gave up property management contracts on two office buildings in downtown Little Rock.

The Little Rock-based firm had managed the 285,000-SF One Union Plaza at 124 W Capitol Ave. (originally known as the Union National Bank Building) and the 75,000-SF Two Union Plaza at 105 W. Capitol Ave. (originally known as the Atkins Building).

The neighboring properties are owned by the Arkansas Public Employees Retirement System, which works out of space in One Union Plaza.

Flake & Kelley resigned from the projects during a review and request for proposals process handled by Invesco Realty Advisors in Dallas, which oversees the pension fund's real estate portfolio.

"As part of our normal asset management services, we periodically review the property management assignments for our clients investments," said Blame Smith, APERS portfolio manager at Invesco.

"This is typically done through an RFP process as was the case with the One and Two Union assignments. We began the review in early summer, and prior to completion of the process, Flake & Kelley chose to resign the account.

"Flake & Kelley and Invesco have enjoyed a mutually beneficial longterm relationship and ended this assignment on amicable terms.

APERS' dissatisfaction over the financial performance of the properties was viewed as a determining, though unspoken, reason for the change. John Flake, a principal in the management firm, brokered the sale of both buildings to APERS.

"We both came to the conclusion that it was a good time to change management firms," said Hank Kelley, president of Flake & Kelley. "It was the right thing to do."

Presidio Commercial Services Ltd. of Dallas was selected to manage the two office buildings. Presidio also manages the neighboring Bank of America Plaza (315,000 SF) at 200 W Capitol Ave.

Without the loss of the APERS contracts, Flake & Kelley would've surpassed 4.3 million SF managed when combined with new business booked during the past 12 months.

Belz Burrow Management dropped from No. 4 to No. 6 after selling Wal-Mart Supercenters in Blytheville and Jacksonville. The deals dropped its total square feet from more than 2.1 million last year to 1.2 million SE

That decline allowed The Ashley Group of North Little Rock to move from No. 5 to No. 4 as the company total approached 2.5 million SF with the addition of the two former Home Quarters locations in Pulaski County.

Other firms posting modest gains were IBR Real Estate of Little Rock and Irwin Saviers & Ballard LLC of Little Rock

The total square feet of property tallied in this year's top commercial property management firms. list grew to 25.4 million SF, compared with 24.5 million SF last year.

Most of that growth is attributed to the expansion of this year's list. New firms include Dixie Development Inc., which is in the process of moving from Springdale to Fayetteville, with 792,000 SF at No. 9; and Haynes Ltd. of Rogers, with 630,000 SF at No. 11.

It also reflects the shifting of 360,000 SF of office space (the two APERS-owned buildings in downtown Little Rock) from Flake & Kelley Management to Presidio Commercial Services. Our list only ranks Arkansas based concerns.
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Comment:Lost contracts bring change among top property firms. (List Overview).
Author:Waldon, George
Publication:Arkansas Business
Article Type:Brief Article
Geographic Code:1USA
Date:Sep 16, 2002
Previous Article:2 steps forward, 1 back for NLR's Main Street.
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