Word of the day: Due Diligence
business : research and analysis of a company or organization done in preparation for a business transaction
Merriam-Webster. (n.d.). Due diligence. In Merriam-Webster.com dictionary. Retrieved March 28, 2022, from https://www.merriam webster.com/dictionary/due%20diligence
At the beginning of Rick Wilson's project to build an amphitheater on the lot where Majestic Hotel once sat at the end of downtown, construction was set to begin no later than this April, with events beginning in March 2023. On March 14, the city received a request from Wilson to extend the due diligence period to January 2023.
The current purchase agreement expires April 16. Deputy City Manager Lance Spicer told The Post the Board of Directors will decide during its April 5 meeting as to whether or not the current contract will be amended, granting Wilson an extension of some sort, or if Wilson will be required to uphold the original agreement. If he does not, the $100,000 of earnest money Wilson put up for the project will be subject to remittal to the city.
The Post has reached out to Wilson, but no response has been received yet.
"Mr. Wilson, he was very upfront that he's had some setbacks and some hurdles to get to where he is now," Spicer said. "But he did share that the Walton Arts Center, which is the operator of the Walmart Amp, have agreed to be the operator of the amphitheater.
"So that's good news in that regard, but at the same time the clock's been ticking, so we as the city have to ensure that we make sure that whatever is offered by Mr. Wilson is something that is in the best interest of the city of Hot Springs and obviously the citizens as well."
While Wilson's March 14 request to the city doesn't outline any specific hurdles, Spicer said R.A. Enterprises have faced rising costs on goods for construction caused by the COVID-19 pandemic.
In the request, Wilson only states they "need more time to complete all the due diligence and design functions necessary for this project."
According to the request, the following has been done in regards to the project:
• Completed a Market Analysis — Phase I completed 10.18.21 and Phase II on 12.2.21. Phase II included in-person interviews.
• Completed title work and survey of the property which included clean-up items on title work.
• Researched and obtained costs estimates on materials and supplies for construction of the Project including current updates on pricing through last week.
• Toured and inspected five  existing amphitheaters in the United States.
• Conducted numerous formal and informal meetings with administrative and design professionals including agencies of the State of Arkansas, e.g. architects, engineers, operators, contractors, support service companies, neighboring property owners, etc.
• Negotiated and placed under contract several additional nearby properties including earnest money.
Spicer said as of right now, the board is contractually entered into a purchase agreement with R.A. Wilson Enterprises for the little over 5 acre property.
"In the current agreement that they have with Mr. Wilson, it did allow him to have a 180-day extension past that initial due diligence period, but that was the only extension that is listed in that agreement," he said.
"So really, the board, what they have to do at an upcoming meeting ... is to consider his request to extend his due diligence period and keep the city and R.A. Wilson Enterprises contractually together for the purchase of the property."