Leader Blues

Friday, June 27, 2008

TOP STORY > >Meeting will discuss housing

By JOHN HOFHEIMER
Leader senior staff writer

Airmen at Little Rock Air Force Base and three other bases continue to make do with aging, sometimes decrepit, housing while negotiations drag on between failed developer American Eagle Communities and other parties including bondholders and the Hunt-Pinnacle Group.

Hunt-Pinnacle is slated to take over the privatization project. The Air Force is an interested observer, but not an actual party to the negotiations, because the housing and the responsibility to build, repair and manage it was sold to American Eagle in 2004.

Brig. Gen. Rowayne Schatz, Little Rock Air Force Base commander, will host a Town Hall meeting at 7 p.m. Monday at the Conference Center to update airmen and their families on progress in the stalled privatization process and address their questions and concerns regarding their current housing on the base.

Work on the building or remodeling of 1,200 housing units on the base has been at a standstill since American Eagle and its managing partner, Carabetta Enterprises, ceased work in May 2007.

The original contract called for construction of 468 new housing units and remodeling 732 existing units at LRAFB. Schatz has said the new contract would be scaled back.

“Right now everything is locked down,” according to Ken Williams, a civilian base spokesman. “The base is pretty much a customer,” he said. “The process is between other parties.”

“We expect that a purchase-and-sales agreement will be signed within the next few months and close in the fall,” according to Mike Hawkins, a spokesperson for the Air Force Center for Engineering and the Environment (AFCEE) headquartered at Brooks City-Base, Texas. AFCEE is the Air Force’s central manager for its housing privatization program.

That’s in line with Schatz’s estimation in April that the deal could close in October with construction starting back up perhaps in the spring.

“Pinnacle Property Manage-ment Services Corporation will then provide day-to-day property management services and Hunt Building Corporation will be responsible for execution of the construction and renovation program,” Hawkins said.

Hunt-Pinnacle, American Eagle and the Air Force all signed a letter of intent in April laying out the parameters of the remaining negotiations, although technically the Air Force is not a party to the negotiations.

Hunt-Pinnacle, which won the 2007 Air Force Professional Housing Management Association Award for best installation team for its work at Dover Air Force Base in Delaware, has built and manages tens of thousands of such units for the military.

That’s good news for the airmen, dependents and the unpaid contractors and suppliers left in the lurch when the Carabetta Group and Shaw Infrastructure, doing business as American Eagle Communities, walked away last year from their contracts to build and remodel several thousand homes at Little Rock, Moody, Patrick and Hanscom Air Force bases. American Eagle Communities completed only about 25 of the 1,200 new and remodeled housing units it contracted to build, own and manage at Little Rock AFB and failed similarly at those other bases.

At the end of three years, Carabetta was two years behind on the Little Rock AFB contract, according to the Air Force.

The Air Force will not decide whether the Carabetta organization can bid on future government contracts until negotiations are settled and a new developer is in place to build and manage housing at four Air Force bases where Carabetta failed to fulfill its contracts, according to the general.

Pinnacle has completed five privatized, military family housing projects totaling 11,485 units with development costs in excess of $1.6 billion within the past five years. Pinnacle is the largest third-party fee management company, managing a $12.5 billion portfolio of properties in 42 states, including 22,000 military family homes.

The Hunt Development Group is 60 years old, according to information on its Web site. It has completed 170 projects for the Department of Defense, including 10 military housing privatization projects and is working on 14 others. It has constructed or rehabilitated 69,000 units of military housing.