By Roxie Hammill
Mediware Information Systems will move five miles from its Lenexa office to open a big new world headquarters in Overland Park, now that the city has approved public financing and a tax abatement.
The council Monday night approved a ten-year, 50 percent property tax abatement on the 66,000 square feet that will initially be occupied by Mediware. That abatement will also be applied to additional square footage as the company expands. In addition, the city council approved economic development activity bonds of $31.6 million to pay sales tax on some equipment costs.
The council voted 10-1 for the public financing package. Council member John Thompson was absent and council member Gina Burke voted against.
The project at 11300 Switzer Road was hailed by a majority of the city council as a catalyst for development at City Place and beyond. Representatives of Mediware have said they needed to move because of their rapid growth.
Mediware, a medical and human service software company, has nine offices in the United States with 900 employees. Real estate developer Ken Block compared the company to Cerner, a health information company with a big Kansas City presence. According to city document, the company has 80 full-time equivalent employees in Lenexa, but expects to have 368 over the next ten years at the new headquarters.
The building project at City Place will begin with the four-story, 126,000-square-foot office building that will be the first of four, Block told the council. He added that his company is “inches away” from finalizing a residential plan across Switzer called the Apex. That will bring retail into the mix, he said. Both those projects together are about $230 million worth of development, about half of what may eventually be built in that area, he said.
“Years from now I hope we will all look back on this and say this was the real epitome of ‘live, work, play,’” Block said.
Council members who spoke in favor of the project cited the cost-benefit analysis showing a return of $2.77 for every dollar of the city’s investment. The project will also add high-quality office space to the city, which has been much desired by the council.
“This is precisely the kind of jobs we want in our city,” said council member Paul Lyons, noting that the jobs require highly-educated employees and the average salary is expected to be $96,000.
Council member Dave White said he remembered when the long-vacant track of land had been slated to become a shopping mall bigger than Oak Park Mall. That never happened, he said, and development along the College Boulevard corridor has been slow since.
City Place and Mediware could pump some new life into the area, White said. “When you look at how old Corporate Woods is, it’s time for that renewal.”
Council member Logan Heley asked whether the public financing tools were justified. Block said the company has been courted by other cities across the state line, and that the city’s help is needed for the expenses of building top-of-the-line office space.
Some claw-backs were written into the agreement approved Monday night. Mediware must maintain its employment and salary levels, for example. The city will also work out a “payment in lieu of taxes” agreement in which Mediware is expected to use Overland Park hotels for the majority of its out-of-town guests.
The company will be the anchor tenant at City Place. The building is expected to be complete by the middle of 2019.