LITTLE ROCK | Development Updates

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$23 million renovation of AT&T building progressing

Work has started on the $23 million redevelopment of the former AT&T building at 1111 W. Capitol Ave., with the aim of converting the currently vacant office building into 115 apartments by early 2027, according to the project's Georgia-based developer.

A $10.08 million building permit was filed in November by a Greenville, S.C.-based contractor owned by Pace Burt, a Georgia-based developer who acquired 1111 W. Capitol in 2020 with the goal of turning the 314,000-square-foot office building into apartments.

A slew of smaller building, mechanical and electrical permits were filed that same month. Arkansas Business first reported on November's multimillion-dollar building permit.

Burt said the $10.08 million will go toward framing on the building and mechanical work inside. Once work is completed (construction is supposed to wrap up in late 2026 or early 2027), the apartments will rent for an average of around $1,500 per month, he said. The redevelopment will cost around $200,000 per unit, bringing the total for 115 units to $23 million.

Fair Market rent on a two bedroom unit in the Little Rock Metropolitan Statistical Area is $973, according to data from the federal Department of Housing and Urban Development. One-bedroom and three-bedroom fair market rent is $811 and $1,125, respectively.

Burt said once complete, the building will include a pickleball court and pool on the roof, as well as a conference space on the first floor. That space, which was also a conference center during the building's AT&T years, will be available for use by the public, including state legislators and lobbyists working at the nearby Capitol complex, he said.

"We're not putting a fence around the property ... (Once)nce we saw the layout and realized what AT&T had done with it in the past, we decided to kind of follow that similar footprint and try and create something that will bring some more attention to the building, instead of just renters," Burt said.

Units will include "condo finishes" like stainless steel appliances, tile bathroom floors and granite countertops. About 95% of those employed by the contractor working on the building will come from Arkansas, according to Burt.

The building will be Burt's second apartment complex in Arkansas, after The Flats at SoMa at the former Veterans Health Administration Hospital. The Flats has leased 80 units since opening four months ago. At that rate, Burt said, he's on track to rent 16 units per month.

"We can hardly get back to the desk before more people want to come in and look. It's our hottest project in the Southeast," he said. In addition to his Arkansas properties, Burt has holdings in Alabama, North Carolina, South Carolina and Georgia.

He said that a primary driver of these developments was the state and federal historic rehabilitation tax credit system, which provides tax credits for the redevelopment of historic buildings throughout the state.

The AT&T building was listed in the National Register of Historic Places in 2022, which allows Burt to utilize federal and state tax credits to renovate the building. He did the same with the former hospital, which was listed in 2005.

Arkansas has two tax credits managed by the Arkansas Parks, Heritage and Tourism Department. The credit on income producing properties -- like the apartment complex at the former AT&T building -- in a city with a population above 50,000, provides a 30% tax credit with a $480,000 cap.

The state also has a major rehabilitation tax credit for projects with a budget of at least $1.5 million. The credit is capped at $48 million worth of expenses for a maximum credit of $12 million per project.

"The problem is the building isn't worth -- even from an appraisal standpoint -- the building is not worth what the cost of the renovation is. And so that's where tax credits on the state level and federal level come in to soften that impact," Burt said.

"These buildings don't happen without community support and federal and historic tax credits. That's so critical ... these buildings, they bring down communities if left vacant. And when you get in there and renovate, as they say, rising tide lifts all ships," he said.

The building was the longtime home of AT&T, which moved out in 2019. A company based in suburban Dallas bought the 10-story building in 2018, with plans to renovate the space into an office and living destination. That plan didn't materialize.

Burt said he is eyeing another property in the area but declined to disclose an address.

https://www.arkansasonline.com/news/2025/dec/11/23-million-renovation-of-att-building-progressing/