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Trail changing things

Regional trail expected to influence business, development decisions by Joel Walsh | May 3, 2015 at 1:00 a.m.

Sure, the Razorback Greenway will provide plenty of opportunities for fresh air, scenic strolls and outdoor exercise. But the 36.9-mile trail stretching from south Fayetteville to Lake Bella Vista also has lots of folks in Northwest Arkansas seeing green -- as in dollar signs.

Chuck Flink, president of Alta/Greenways, the lead designer of the project, has said the approximately $37 million greenway will pay for itself several times over in the form of new business growth and bicycle tourism.

Web watch

Go to the online version of this story at nwadg.com to see an analysis of building permits issued in close proximity to the Fayetteville trail system since 2011.

Source: Staff report

Fayetteville Chamber of Commerce President Steve Clark for years has referred to the city's trails as "ribbons of commerce."

"As a ribbon wraps around a package but comes together to connect in the center of the package for the bow, that's kind of what these ribbons do: They wrap around our community," Clark said earlier this month. "The idea is these ribbons go places that sidewalks and highways don't go."

He thinks people will ride the greenway from Fayetteville to Bentonville to visit Crystal Bridges Museum of American Art, maybe stopping along the way at the Springdale Farmers Market or Pinnacle Hills Promenade in Rogers.

"It allows you to enjoy the entire region without having once to get in your car," Clark said.

Location Location

Dino and Melanie Vergura knew they wanted to open a coffee shop and restaurant on Emma Avenue in downtown Springdale after hearing about the greenway and plans for Shiloh Square and Walter Turnbow Park.

"When we heard they were doing a few-million-dollar renovation down there, we absolutely were excited to open a business," Dino Vergura said Thursday.

The couple is refurbishing an 80-year-0ld building at 107 E. Emma Ave. that has been home to a law firm, a bail bond company, a barber shop and a cafe in the 1950s. The building is across the street from Shiloh Square and just west of the trail crossing on Emma Avenue.

"I don't think we could have picked a better location," Melanie Vergura said.

The restaurant, called The Steam, will serve coffee, breakfast, lunch and dinner and local beer from Core Brewing Co. A back patio will be visible from the greenway, which cuts right through downtown. Melanie Vergura said the couple plans to open the first week of June.

Other Springdale businesses, including Noble Crossing Cider House at 321 E. Emma Ave., have announced plans to open within walking distance of the new trail crossing.

"Almost all of the momentum that's been picking up the past year and a half, I really believe it's because of the footsteps that the trail is causing in downtown," said Lisa Ray, vice president of the Downtown Springdale Alliance and president/CEO at Arvest Bank Springdale.

In Bentonville, Steve Outain and his business partners drew their inspiration for Bike Rack Brewing Co. from trails and their love for cycling.

Outain said he began brewing beer at home. He'd share his concoctions with his cohorts in the group Friends of Arkansas Single Track when they'd ride the Slaughter Pen trails. Pretty soon, he and some brewing buddies started talking about opening a permanent business.

"We originally were looking for places that would be more on the mountain biking trails around Slaughter Pen and couldn't find anything," Outain explained.

Then they found out about The Hub, a collection of commercial spaces at 410 S.W. A St., right on the Bentonville Downtown Trail, which ties into the greenway.

"Being near or accessible to the trail was one of our tenets," Outain said. "That was something we really wanted to focus on."

The brewery has tried to market to cyclists, with beers named after different trails at Slaughter Pen.

Outain said, so far, things have worked out well. He recalled a couple from southern Missouri who recently came in. They had ridden the greenway from Lake Bella Vista to Fayetteville, where they stayed the night, and were on their way back, trying beer from different breweries along the way.

Outain said it's that type of experience that makes the greenway a game-changer.

"When people are looking for a destination brewery experience -- to be able to safely get to and from different breweries and do some sampling -- that's a big focus of ours now," he added.

Cary Arsaga has found some of the same things to be true. Arsaga said there's a bike club that regularly rides down from Bentonville on the weekends to eat breakfast on the deck at Arsaga's at the Depot, 548 W. Dickson St. in Fayetteville.

Arsaga and his wife, Cindy, opened the business in 2012 with the firm conviction that the old train depot was the perfect spot to expand their growing coffee network.

"The building's cool, the train went by and the fact that the trail was there -- it was like, 'C'mon, can it get any better than this?'" Arsaga said.

The couple remodeled the building to meet their needs.

"I knew I wanted the main entrance, if you will, the larger, more impressive side, to be on the back, or what's considered the back," Arsaga said. "I wanted to make it the front, because that's where the trail is."

He built a covered patio and put in bike racks. High Roller Cyclery later paid to install a bicycle repair station. Arsaga said business has been great.

"It's been a challenge just to keep up with how much we grow," he said. "It would not be half the business it is without the trail. People come there no matter what. But, boy, when the weather's nice and it's beautiful outside, they flock there to go to the deck and watch people walk and bike by."

The Arsagas hope to repeat their success in a new location -- a bright blue, brick building at 514 W. Martin Luther King Jr. Blvd., where an auto repair shop used to be. The building is just west of the Frisco Trail tunnel running under King Boulevard.

"That location was definitely because of the trail," Arsaga said. He hopes to open sometime in 2016.

"One of the biggest amenities"

Trails don't just appeal to bar and restaurant owners.

They've also been attractive for developers of large commercial and residential projects, at least in Fayetteville, where the first link in the citywide trail system -- the Mud Creek Trail -- opened in 2003.

The Mud Creek Trail wasn't the reason Procter & Gamble chose to build a 64,000-square-foot office building, home to its Walmart Global Customer Team, at 1303 E. Joyce Blvd in 2007.

But, Tim Marrin, a spokesman for the Fortune 500 company, said, "It was a benefit to moving where we are."

"It is something from a fitness standpoint that our employees take advantage of," Marrin added. "It's been a great asset to the team to have the trail so close."

He said Procter & Gamble has bikes available for employees to check out, and some do -- either to get to and from work or to exercise on their lunch break.

The city's trail system wasn't the root reason behind Specialized Real Estate Group's decision to build in Fayetteville. The company's president, Seth Mims, has been clear that Specialized's recent large-scale apartment projects have come as a result of growing enrollment at the University of Arkansas.

But, Mims said last week, trails were a key factor in the locations Specialized executives and their investment partners chose.

"We think that's one of the biggest amenities apartments can have," he said. "Bike trails create so many connections: to vital retail and restaurants and connections to nature."

All of the projects Specialized has been involved with over the past few years -- the North Creekside apartments, Eco Modern Flats, Sterling Frisco, The Cardinal and now Beechwood Village, Harvey's Hill and Uptown -- are right on the trail system or within a three-minute walk from it.

Mims said market studies the company commissioned show rental rates are higher and vacancy rates are lower in apartments, not just near trails, but near destinations, such as the university or Dickson Street, that tenants can easily access.

"Market studies often reflect that we'll get a higher rent per square foot if we're right on the trail, and that helps us to convince debt and equity sources that our projects are viable," Mims said.

According to an analysis by the Fayetteville GIS Division, 48 percent of the 1,526 building permits the city issued since 2011 were for property within a half-mile of a trail. That may sound like a lot, but, because of Fayetteville's extensive trail system, almost half of the city's land lies that close to a trail.

A trend emerges when accounting for square footage. Seventy-two percent of the total square footage contained in those 1,526 building permits is within a half-mile of trails, according to the city's analysis.

"It's more desirable to be along the trail system," Jeremy Pate, Fayetteville Development Services director, told members of the City Council's Transportation Committee last month.

"I can remember when we were constructing it," he added. "We were having difficulty with some of these apartment complexes, because they thought it would be a danger. It's actually now a major asset. I think you'll see throughout the region investment along the trail corridors."

Just one of Specialized Real Estate's projects, the Sterling Frisco apartments, generated $200,000 in building permit fees and fire/police and water/sewer impact fees for the city.

According to Washington County property records, a Newtown Square, Pa., company called College Park Frisco Holdings bought the apartment complex for $49 million in January. The company owes $93,043 in property taxes this year, about 170 times more than the $559 landowners paid before the property was redeveloped, according to the Washington County Collector's Office. That tax money will be distributed to the city, county, Fayetteville School District and Fayetteville Public Library, among others.

Pate said student housing has a multiplier effect.

"We're having a Dunkin' Donuts, we're having a Jimmy John's on (Martin Luther King Jr. Boulevard), because there's now a student complex there," he explained. "It makes it more attractive for businesses to locate in that area."

But whether trails themselves are making properties more valuable is unclear.

Marilyn Shoffit, a real estate agent with Crye-Leike Real Estate Services in Fayetteville, said trails are something she hears about more and more from residential customers. A lot of homebuyers, especially young homebuyers, say they want to live close to a trail, Shoffit said, just like with parks or schools.

She said she'll often mention that a house is close to a trail in public remarks when she's trying to market a property. But she couldn't say for sure if that translates into houses selling quicker or at a higher price.

Stuart Sanders, with Parrish Appraisals in Fayetteville, said it's a mixed bag.

"We do take (trails) into consideration," Sanders said. "It's not the same as we might consider a roadway, where we might get some traffic counts from it, but, rather, it's something similar to how we treat a railroad right of way."

"It's a positive for the right type of business," he added. "But, in some property types, it's not necessarily a positive thing."

For a restaurant, bike shop or most retail outlets, trails can add customers, Sanders explained. But on a small, commercial lot where someone wants to develop a five-story office building on a tight footprint, having to deed the city a trail easement reduces the potential square footage that can be built on the land, he said.

Sanders said some homeowners may see trails as a positive.

"Where it runs afoul is wherever you have low-income areas and folks that would probably steal anyway," he added." It makes it a clean getaway for them."

Sanders said trails may have a more communitywide impact on property values than on an individual basis -- much like how an abundance of good parks or a state-of-the-art museum can raise the quality of life and attractiveness of a particular area.

"If you have enough of these communitywide influences, it makes the whole area more attractive," he said.

Live, Work, Play

The greenway is here for residents and visitors alike.

John McLarty, senior planner for the Northwest Arkansas Regional Planning Commission, used 2010 Census Bureau estimates to determine that roughly 76,000 people live within a half-mile of the regional trail. Approximately 80,000 people work within that distance.

"It's very possible to live and work within the trail corridor," McLarty said. "That's what we wanted. This actually was designed to provide transportation alternatives, so people could get home or get to work or go to school."

The commission's recently published Bicycle and Pedestrian Master Plan calculates monetary benefits for Northwest Arkansas residents. The plan concluded that, by increasing the percentage of people who walk or bike to work or school, the greenway has the potential to save residents millions of dollars each year in household transportation savings, reduced health care costs, lower street maintenance costs, fewer vehicle crashes and reduced vehicle emissions. Actual anticipated savings vary based on how much the pedestrian "mode-share" increases.

The commission also anticipates millions of dollars of return on investment through bicycle tourism -- people who visit the area to ride the greenway or participate in planned events like a Square to Square bike ride between Bentonville and Fayetteville.

Multiple states and cities with bike trails throughout the country have conducted economic impact studies to try to determine the value of bicycle tourism.

Bike trails and bike lanes along a 105-mile stretch of the Outer Banks, off the coast of North Carolina, cost $6.7 million to build. The North Carolina Department of Transportation estimates bicycle tourism there generates $60 million in economic activity each year -- a nine-to-one annual return on a one-time investment. The department's study indicated half the area's 680,000 annual bicycle tourists earned more than $100,000 per year.

In Missouri, the Katy Trail stretches approximately 240 miles from Clinton, in the western half of the state, to St. Charles County, just outside of St. Louis. According to the Missouri Department of Natural Resources, a stretch of the trail that passes through Columbia, Mo., home of the University of Missouri, had about 72,000 users last year. The department, in a 2012 study, estimated the entire Katy Trail State Park had an annual economic impact of $18.5 million.

"Hundreds of businesses along the Katy Trail provide a variety of tourism-related services, from wineries, restaurants and shops to bed and breakfast inns, motels and campgrounds," the study stated. "The Katy Trail has been a catalyst for tourism development, and many small businesses depend on the trail for an ongoing stream of customers."

NW News on 05/03/2015

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