Tag: Kelley Commercial Partners

Opportunity Zones: The Basics

What are opportunity zones?

Opportunity zones were created by congress as part of the Tax Cuts and Jobs Act of 2017 to spur economic growth in economically distressed communities. In April of 2018, Gov. Asa Hutchinson proposed 85 tracts around the state be designated as official Opportunity Zones in Arkansas. By December of that year, the US Department of the Treasury confirmed this proposal and all 85 tracts were designated as Qualified Opportunity Zones (QOZs). There are more than 8,700 designated zones nationwide that provide tax incentives for private investment in low-income communities. Opportunity Zone properties around the state vary greatly. They include urban/downtown, industrial, suburban, and rural areas—but each QOZ shares the same need of a spur in economic growth and job creation. Click here to view an interactive map of opportunity zones in Arkansas.

How do they work?

Investors who wish to take advantage of this program have 180 days to reinvest any prior eligible capital gains into a Qualified Opportunity Fund (QOF) and by doing so, they receive several tax incentives on those gains. The QOF is created to invest in an opportunity zone property with at least 90 percent of its assets dedicated to the QOZ. By reinvesting all or a portion of their gains into a QOF, the investor’s capital gains tax may be deferred until the sale of the QOZ investment or until December 31, 2026, whichever comes first. If the QOZ is held for five years, the investor will benefit from a 10% exclusion of the deferred gain; holding it for seven years will increase the exclusion to 15%. Investors who hold the QOZ for at least 10 years will eliminate paying a capital gains tax on appreciation of the QOZ property.

Who benefits?

Investors benefit from the preferential tax treatment while communities benefit from property improvements, job creation, and new businesses. Small businesses operating in the opportunity zone may also benefit with an equity investment from a QOF. There are requirements that must be met to qualify as an Opportunity Zone Business (QOZB), which are outlined in detail in the New Proposed Regulations.

The Opportunity Zones program is a unique and effective economic development tool and an important part of making our communities and neighborhoods stronger, safer, and more economically healthy. As Opportunity Zones grow and prosper, the communities around them reap the benefits, which in turn, benefits everyone.

Learn more:

IRS: Opportunity Zones

Arkansas Economic Opportunity Zones

The information provided here in is not to be construed or relied upon as legal or tax advice.

 

Start-Up Story: By Design

Cassy Harrelson

If you work in or around Simmons Tower, chances are good you’ve seen the small salon, By Design, in the southeast corner of the lobby. Cassy Harrelson has owned and operated the salon since 2009, but she’s been a part of the business for much longer than that. In 1995 she became a part-owner but sold her half of the business when she moved to California in 2000. Lucky for us, she moved back to Arkansas in 2009, bought the business outright, and has been running the popular downtown salon ever since.

Cassy is a certified nail technician with decades of experience, but when she began her journey, she might not have predicted just where she would end up. Her whole career started when she decided that she wanted to try to learn how to do her own nails. She really liked this new hobby and seemed to have a knack for it, so she began doing manicures for friends and family out of her own home. When she realized that she could actually go to nail school and get officially licensed, it just seemed like the most natural choice. So that’s just what she did, but she didn’t start working in a salon right away. Cassy was a stay at home mom for many years and was able to run her nail business out of her home. She had never even worked in a salon until she started at By Design in 1995 and just look at her now!

Cassy loves working downtown. The heavy foot traffic around the building keeps things interesting and helps her stay connected with her customers. Plus, most stylists have to work on Saturdays, but not Cassy. Because the building closes on the weekends, she doesn’t have to keep regular salon hours and she’s grateful for the freedom that brings.

By Design is open Monday through Friday, from 8 a.m. – 5 p.m., though they are flexible to accommodate customers. Services provided include haircuts and coloring, extensions, styling, waxing, and of course, manicures and pedicures! Walk-ins are almost always welcome, but appointments are encouraged. So next time you need to spruce up a bit for that business meeting or dinner right after work, Cassy and her team at By Design have you covered.

Hank Kelley, guest lecturer at UALR College of Business

Hank Kelley, Jr.

On Monday evening, Hank Kelley was invited by instructor Elizabeth Small to lecture her UALR College of Business Finance 4371 class. This senior-level class teaches elements of mortgage financing for housing and investment property; sources of funds; application and approval; real estate investment analysis; effects of financing and income taxation upon investment returns and is part of the college’s real estate program.

Kelley discussed the types of mapping and demographic information Flake & Kelley provides clients. National retailers rely heavily on location, traffic counts, other retailers, and competition, as well as demographics before deciding on a site. He also covered current trends in the commercial real estate market. He noted the increased interest from investors in multi-family properties. An investment group out of Cinncinati recently purchased the 84-unit Barrister Court apartments. Retailers, on the other hand, are figuring out how to do more with less. Kelley commented that Little Rock’s newest national retailer, Trader Joe’s, prefers keeping shelves stocked rather than leasing more space for storing goods. The Little Rock Port was recently in the news because the Michigan-based company, HMS Manufacturing, chose a 550,000 SF industrial space in the port to open its fourth manufacturing facility.

On the subject of investing in real estate, Kelley shared advice his father, who was also in the real estate business, shared with him, “Every piece of property you own owns a piece of you.”

Hank’s executive assistant and current student at the College of Business, Tara Mitchell, was invited to sit in on the lecture.

“I was so excited when Professor Small gave me permission to sit in on this class. It’s great to watch Hank share his knowledge with the next generation, and I am grateful for the opportunity to learn from such a successful person on a daily basis,” said Tara Mitchell.

Flake & Kelley Commercial Elects New Shareholder Partners

Little Rock, AR (December 21, 2018) – Flake & Kelley Commercial is pleased to announce the election of four new shareholder partners. Nicholas Kelley, Cynthia Lu, Kevin Pledger, and Eric Varner have earned shareholder status in the company to join existing partners John Flake, Hank Kelley, Daryl Peeples, Cheryl White, Maggie Hogan, Kathy Groce, James Harkins, Bill Pendergist, and Brooke Miller. With the addition of these new shareholders, Flake & Kelley now has partners across every department, including: brokerage, property management, accounting, human resources, and maintenance.

Hank Kelley, CEO of Flake & Kelley Commercial, commented: “Our new shareholders are an important part of our future as they demonstrate a high degree of knowledge and care for our clients.”

John Flake, Chairman, joined Mr. Kelley in congratulating the new partners: “Our new shareholders represent the finest in professional services. We are delighted to recognize their many contributions to Flake & Kelley.”

Nicholas Kelley joined Flake & Kelley in 2017 and serves as Executive Vice President for the company. He is also a member of Flake & Kelley’s Executive Committee. Nicholas is a member of the company’s brokerage/leasing team, representing such clients as Arthur’s Steakhouse/Ocean’s at Arthur’s and Riverside Properties and properties including Two Financial Centre and the Blandford Building. He also provides guidance to Flake & Kelley’s team on a variety of complex legal matters.

Nicholas is a graduate of the University of Georgia (BBA, Real Estate and Finance) and the Walter F. George School of Law, Mercer University (JD). Mr. Kelley received The American Bar Association Section of Labor and Employment Law and the Bureau of National Affairs Award for excellence in the study of labor and employment law. Prior to joining Flake & Kelley, Nicholas practiced as a commercial real estate attorney with the Little Rock firm of Quattlebaum, Grooms & Tull, PLLC and most recently with a large Am Law 100 firm in Atlanta, Georgia (McGuire Woods LLP). Nicholas is recently completed the Arkansas Business Executive Leadership Academy.

Cynthia Lu joined Flake & Kelley in 2013. As a member of the company’s transactional team, Cynthia is responsible for traditional brokerage, leasing, and tenant representation. She represents national, regional, and local retailers such as AT&T, Firebirds Restaurants, Mattress Firm, PetSmart, Signet Jewelers, and Taco Bueno. Cynthia is also a leasing agent for a number of retail centers, including Westchase Plaza, Markham Square, The Village Shopping Center, and Lewis Crossing in Conway.

Cynthia is a summa cum laude graduate of Rice University (BA) and earned a master’s degree from Georgia Tech University in Building Construction & Facility Management. Cynthia was one of the first LEED (Leadership in Energy and Environmental Design) accredited professionals. She is a member of ChainLinks Retail Advisors and the International Council of Shopping Centers (ICSC). Cynthia was recognized as one of Little Rock Soiree Magazine’s “Women to Watch” in 2017. Cynthia has recently been selected to participate in the Leadership Greater Little Rock Class XXXIV.

Kevin Pledger joined Flake & Kelley in 2014 and serves as Director of Facilities. He is responsible for directing all activities for the facilities department including the repair, maintenance and construction of all Flake & Kelley managed properties.

Kevin is a member of the American Society of Healthcare Engineering (ASHE), the Arkansas Association for Healthcare Engineering (AAHE), the National Fire Protection Association (NFPA) and the American Society for Heating, Refrigeration, Air Conditioning Engineers (ASHRAE). Prior to joining Flake & Kelley, Kevin served as the Operations Manager for the Arkansas Building Authority.

Eric Varner joined Flake & Kelley in 2013. As a member of the company’s property management team, Eric oversees the management of some of Central Arkansas’ premier office buildings, medical buildings, and retail centers, including Two Financial Centre, The Village at Pleasant Valley, Westchase Plaza, and Shackleford Crossings.

Eric is a graduate of Ouachita Baptist University (BA – Business Administration). Eric was recently awarded the designation of Certified Property Manager® – CPMs are recognized as experts in real estate management and they are at the top of the profession. Eric is also active in Park Hill Baptist Church, Urban Promise, and FORE Ouachita.

For further information, please contact:

Paula Guajardo, Director of Marketing

Flake & Kelley Commercial

501.244.7540 (direct)

501.960.3693 (mobile)

pguajardo@kelleycp.com