Jonesboro, AR – (JonesboroRightNow.com) – Businesses in Fountain Square off Highland Drive are looking for new locations after they were served a termination of their leases earlier this week.

All leases will be terminated Feb. 28, and demolition of the Fountain Square buildings is set for March 1, according to a letter sent to tenants and obtained by JRN.

Fountain Square is located on 2005 E. Highland Drive, and houses a variety of businesses within the building’s suites. East Arkansas Area Agency on Aging (EAAAA) is the property owner and sent the letter to those businesses.

The letter was delivered to tenants on Dec. 16 and provides a 75-day notice to vacate. JRN also learned that rent for tenants is around $1 per square foot and includes utilities.

Regina McKay, owner of Gina’s Place restaurant, which opened in 1983, said her business will be moving to a new location.

She said she was looking at a potential location on Caraway Road, but that would likely see a rent increase. She added that this possible new location, while restaurant-ready, needed a larger vent hood for the staff’s cooking needs.

McKay said that the location she’s considering does have a large, accessible parking lot for the restaurant’s many elderly customers. However, the potential rent increase could mean raising menu prices, a thought that “scares me to death,” she told JRN.

“I’m a little nervous, but today, after looking at that building and realizing there are options, then I don’t feel as overwhelmed,” McKay said. “I know God’s got it, and I know this is a God thing because this building is falling apart. It’s been here since the early ’70s, and it’s just duct-taped to death. It’ll be a blessing.”

Gina Wagner has been the owner of J Michael’s Family Hairstyles since 2012, although the business is set to celebrate its 50th anniversary in April.

Wagner said receiving the news of the lease termination was a “shock.” Over the past 24 hours, she said, God has “laid stuff out real easy” and that she is already in the works of drawing up a contract to acquire a building on Grant Avenue.

“I’m still a little scared,” said Wagner. “Here I am, fixing to have to move a 50-year-old business to another location, and we are known for walk-ins.”

Because the contract has not been finalized, Wagner did not provide further details on the salon’s potential new location. She added that the move should not affect the business’s operating hours.

“The business plan, per se, I’m not going to change any of that. I want it to still be J Michael’s,” Wagner said. “I want it to continue, it’s just gonna be in a different building.”

Melissa Prater, executive director of the EAAAA, told JRN that the termination of the lease occurred as the nonprofit seeks ways to increase funding for its programs. The EAAAA, established in 1978, offers a range of services to older adults and people with disabilities and serves 12 counties in Northeast Arkansas.

“The ultimate decision was to do this to provide funding for our programs, especially in times like now, where inflation’s been high,” Prater said. “We’ve not seen an increase in our funding, and most of the time our programs run into a shortfall because there’s not enough funding, so we wanted to be sure to secure that.”

In addition to Fountain Square, EAAAA also owns the former Malco property, which is adjacent. The nonprofit initially purchased the property to house vehicles when it provided non-emergency Medicaid transportation. However, Prater indicated that EAAAA has not done anything with the property, and when she became executive director, she began looking to sell it to increase funding for the nonprofit.

Prater said the EAAAA sent out a request for proposal to encourage bids from different vendors/contractors on the old Malco property to provide the nonprofit with extra funding.

According to the letter that was sent to tenants, EAAAA and Haag Brown Commercial Real Estate and Development have partnered to develop the old Malco property. Throughout the year, the nonprofit had incurred high maintenance costs for the Fountain Square buildings as the buildings are aging and require more maintenance, the letter said.

“It was determined fairly quickly through these consulting processes and stuff that, really, the best option would be, if we were willing, would be to sell the Fountain Square property along with the Malco property, because that would make it more valuable, more land, things of that nature,” Prater said.

Joshua Brown, co-founder of Haag Brown, told JRN, “I’ve worked on this particular property for nearly 20 years, from the time the Malco family sold it to EAAAA. We have always known it was a ripe property for new development.”

Brown added, “My hope for the property is the same as with all of the projects we start, that we can get the most money or highest yield for our client on the property they have hired to sell or develop, and that it will be something that’s good and beneficial for the community.”

Tensions have been high among Fountain Square tenants since receiving the letter in mid-December.

“I felt like they disrespected us,” said McKay to JRN of EAAAA. “We’ve been here longer than they have, actually. It was a shock the way they did it by just sending somebody around with letters for everybody instead of talking to us face-to-face.”

McKay published a post on Facebook the evening she received the notice. In the post, she asked for help in finding a new location for her business. Both McKay and Wagner said they’ve seen an outpouring of support from their clients, adding their customers have told them they will follow them wherever they move.

The business owners also said that, as soon as they had a new location finalized, their customers would be informed.

“We will be moving,” Wagner said. “We will be doing business as we always have for the past 50 years, and we’re gonna do it another 50 years.”

Editor’s Note: This article was updated to correct statements regarding Wagner’s ability to accept walk-ins after moving and the specifics of the lease terms. EAAAA provided JRN with a copy of a lease, but tenant-specific leases were not provided.