By Kevin Collison
A $95 million development that would replace a Freight House District parking lot with a nine-story apartment tower above a three-level garage is being pursued by Greystar, the nation’s largest apartment operator.
The 250-unit “Tracks 215” project is proposed for a 1.1-acre lot west of the historic Freight House building, where Lidia’s and other restaurants are located, and bordering the Kansas City Terminal tracks.
If built, it would be the latest in a surge of new apartment construction in the Crossroads Art District that’s already adding more than 1,100 units to the area between the Central Business District and Crown Center.
“Greystar is a company that has flirted with Kansas City a long time and looking to do a 250-unit luxury project,” said Chris Sally of Development Initiatives, a member of a local group working with the Charleston, S.C.-based firm.
Sally said Vince Bryant of 3D Development and partners are the master developers of the Tracks 215 project, and Greystar would build the apartment component. Design is in the preliminary stage and no renderings are available.
Bryant also is redeveloping the historic, former Kansas City Star building and was a partner in the redevelopment of Corrigan Station.
The developers are seeking tax incentives to help build the 400-space garage from the Kansas City Tax Increment Financing Commission. The project is scheduled to be introduced to the TiF Commission Wednesday.
A property tax abatement for the apartment component of the development is expected to be sought from Port KC.
The proposal is asking the TIF Commission to amend the existing 22nd and Main TIF Plan. Bryant utilized that TIF plan a few years ago to help redevelop the historic Candle Building at 2101 Broadway and the historic Creamery Building at 2100 Central.
Sally said the developers want the TIF Commission to increase the amount of TIF funds being reimbursed for the Candle and Creamery projects, and use that money to help finance the garage.
The garage would serve not only residents of the Greystar apartment project above, but nearby office users. The existing 150-space parking lot currently serves 17 different businesses in four buildings, Sally said.
“Parking is such a commodity in the Freight House District and we’re trying to create an effective garage that can serve both apartments and offices,” he said.
Sally said the project is not feasible without the TIF assistance for the garage. The project is scheduled to be introduced to the TiF Commission Wednesday.
Greystar is a huge name in the apartment industry both nationally and internationally. The firm manages about 500,000 units and beds in the U.S., and manages and operates an estimated $115 billion in real estate around the world.
The apartment breakdown in the proposed Tracks 215 project are 60 micro units averaging 515 square feet; 165, one-bedroom averaging 798 square feet, and 25 two-bedroom averaging 1,205 square feet, according to an application filed with the city.
Projected monthly rents are $1,300 for a micro, $1,915 for a one-bedroom and $2,747 for a two-bedroom, according to the EDC.
If the development receives the necessary approvals, work could begin in early 2020 with completion anticipated in March 2021.
Other major apartment projects either underway or recently completed in the Crossroads include:
-ARTerra, a 126-unit tower at 21st and Wyandotte that opened in January.
-City Club, 283 units under construction at 19th and Main.
-Artistry KC, 341 units under construction at 19th and Oak
-Crossroads Westside, 221 units that recently opened at 601 Avenida Cesar E. Chavez
-REVERB, a 132-unit tower under construction at 18th and Walnut.
-Atlas, a 16-unit historic rehab project completed at 15th and Walnut.
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Yay, just what we need down here. Another overpriced luxury apartment complex built without paying any taxes to KC that will probably sit at least half empty, if not more. Further pricing out people who’d like to live down here and forcing out local businesses and galleries with rent increases.
The property will continue to pay the current taxes assessed there, that it will pay no taxes to KC is a common misunderstanding of how tax incentive programs work.
But when the incentive period ends, the owner will have to raise rents in order to maintain their rate of profit (or sell to someone who will have to raise rents even higher, having no history of profit from the property) unless they can get new incentives on the argument that by then the building will need updated. Either the artificially-supported luxury deteriorates, or the city-as-a-whole never benefits from it. Meanwhile, the proportion of non-luxury housing in our mix continues to decline. Under our economic system, I’m not opposed to luxury housing, nor to incentives. But too much of the way it’s being done benefits too few. Eventually, the argument that a sprinkler system in one lawn improves the quality of everyone’s soil (a little, over time) isn’t going to, ahem, carry water. The well-off people who’ve mainly benefited (either through profit or luxury) can just move on to the next target market. The rest of us are trying to live here.
Bull
If that the case they can paid for the project there dame self and leave my tax money alone
Great news. Cities need people. And separate from any terms the developer might negotiate, residents pay sales taxes, earnings tax, and they patronize the local businesses… all without using tax dollars to extend the grid out into corn fields as is happening at the metro’s rim.
These tax incentives no longer make sense. When downtown was a dump and the West Bottoms was empty, sure, it made perfect sense to use them as a means of drawing in developers.
There’s no reason why a 115 billion dollar company can’t find it’s own financing for projects like these, especially when they have every intention of price-gouging the hell out of our citizens.
The people who post negative comments about projects utilizing incentive, do not have a basic understanding of investment finance.
Without incentives, no investor could achieve a market return on this property, thus leaving it a dark, sea of asphalt, providing no benefit to the area’s residents/businesses. I encourage everyone to educate themselves on what a but-for analysis is. That should provide you with a basic understanding of why incentives are necessary.
The “There’s no reason why a 115 billion dollar company can’t find it’s own financing for projects like these” argument is laughable. First off, the company manages $115 billion in assets. That doesn’t mean they have $115B in equity to invest. Second off, why would a company (let alone the most successful manager of multifamily assets) make an investment the has below market return.
It’s not price gauging, its supply and demand. As long as there is demand, investors/developers will provide the supply. If you do not have the funds to live there, don’t live there.
If incentives are necessary to get a “but-for” built, it means the demand doesn’t exist. It means the return on the basis of actual demand wouldn’t satisfy a given investor/developer/owner. Another word for incentive is subsidy, which is basically what’s involved here. Subsidized profit (for a few) to induce subsidized luxury (for a few). Sure, it raises value of adjacent property, which helps city budget (provided those properties aren’t also covered by TIF) but also forces their owners to raise rents or sell. It further concentrates the payment of property taxes into fewer hands, which is a recipe for corruption. Maybe there are areas of Kansas City where only rich people are allowed to live and do business, but that’s something that all its citizens should be deciding together, no?
I can’t to see what you guys all say when this passes and development, companies, and conventions all head elsewhere. You think too few projects are happening in distressed areas now??? Just wait…
I love it when the arguments get to the point where the indefensible extortion built into our system is laid bare. Thank you.
Thank goodness there aren’t more people like you, Saul. Otherwise Greystar (and every other developer/owner/investor) would just pack up and take they’re millions else where. KC WANTS to grow and compete with surrounding cities.
Also, if the avg rent on these apartments is ~$2.50/SF and the avg size of a unit is ~700 SF that equates to $1,750/mo. That means residents should make ~$70k annual to responsibly afford this rent. $70k is a far cry from “rich” if you ask me. So your argument about creating pockets of wealth is outlandish and baseless.
If $1750 for a 700 sqft apartment seems reasonable to you, you’re pretty rich. And if wages were rising, especially among the poor, to the point where the median were $70k, I’d have much less issue. As it is, KC’s median income is a bit more than half that, meaning something approaching half the residents can’t afford $1750 (even if that metric were reasonable).
Growth can mean a lot of things, including parasitism and cancer. I want people to thrive, and whatever growth is necessary to achieve that to be so aimed, rather than the other way around. KC can’t solve the problem by itself, of course. But that doesn’t invalidate or devalue the criticism.
It’s personal preference. If $1,750 is too much for 700 SF, go to Roeland Park or Mission, Kansas and rent a 3-4 bedroom house for that price. If you want to live in downtown, that is what you’re going to pay.
Saul, thank you for trying here
Agree with Ryan. Developers are tone deaf. This is not what residents are clamoring for, no one is crying out for “luxury” apartments or the proposed lux hotel that is not needed. People want housing that is fairly priced. The developers just see dollar signs. Certainly, the city should not be giving incentives for this project or the hotel. The days for that are long past.
So are people here defending a parking lot? Again?
Incentives are going to be necessary for the foreseeable future guys/gals. There are just too many surface lots downtown.
People take a deep breath. Do you really think that these rents will stay at this high of a level forever? The more units that come online the greater the downward pressure to lower rents to remain competitive. There is only so much demand right now and with this almost surplus level of supply, prices can only go in one direction. The Crossroads businesses need more weekday post-lunch foot traffic. Thats a fact.
By the time that happened most us be dead or lock up in an old folk home.
All see my tax money waste on pointless project that not going to help my small business or feed my family.
Are help the local community at all
Your tax money isn’t going to the project; it’s some of the future tax revenues a project will create that would not have existed otherwise that will be going to the project.
That argument is so tired Kevin. You’re factually correct that the revenue would not have existed otherwise, but as the city continues to grow, and the budget continues to grow, and the deferred maintenance list continues to grow, and the road-miles continue to grow, the needed increase in tax revenue is disproportionately applied to the private sector. How do you suppose that shortfall will be covered?
It’s not an argument, it’s a fact. Believe me, I wish Kansas City was thriving to the point these incentives were no longer necessary, but it isn’t. Anyone who travels to similar places like Minneapolis, Denver, Nashville, Indianapolis and even Omaha, Des Moines or OKC knows we have a long ways to go. After decades of sad negligence, our greater downtown is at least back in the game. But it still has far to go if we want to be an appealing place for smart, younger adults to live and to compete in the global economy of the 21st C.
Somebody got some new talking points from the EDC! I like it. Is it a laminated card or have they gone electronic? Where are these “young, smart adults” going to work Kevin? DST? Maybe one of the bars in P&L is hiring. I doubt they’re going to live downtown and commute to Olathe (Garmin). How are these “young, smart adults” who can’t pay their student loans going to afford luxury apartments in the Crossroads? Why do they need a TIF parking garage for a car they do not own? And finally, you conveniently side-stepped my initial question. Who picks up the tab for the growing tax burden created by this 21st Century, high-tech, downtown utopia we’re creating? I’m guessing it ain’t Prairie Village. When someone complains that it’s “their tax dollars” and you casually dismiss them with the “but for” or “you love vacant lots” argument you conveniently ignore that it *is their tax dollars. They (the people actually paying taxes) have to make up for the shortfall that your tax-abated hotels and luxury apartments are NOT contributing to.
Snark doesn’t cut it, sounds like you’re part of the problem here. There does seem to be a sizable segment of the population unfortunately here who want KC to remain a sleepy, complacent city. Whether you acknowledge it or not, the city’s tax base isn’t going to grow at all if people continue to decide to invest in Johnson County or our national rivals.
I’m ok with a project that doesn’t require new roads and miles of new utilities and stretching public safety further distances (police/fire) getting some incentives. It’s when the city builds new roads and fire departments and utilities to serve the 20 homes on the fringe that is the real drain on our taxes over time.
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