Wanting to avoid another “false start,” as one official put it, the Mission City Council on Wednesday talked at length with developers of the long-delayed Mission Gateway project about the $268 million development’s current financing ahead of key votes later this month.
The upshot: This is the fifth iteration of a plan to remake the prominent site at Shawnee Mission Parkway and Johnson Drive, where the old Mission City Mall used to be.
- Later this month, the Mission planning commission and city council plan vote on potentially finalizing a development agreement with New York-based Cameron Group that includes a public financing package.
- Still, based on the project’s troubled history, some city councilmembers on Wednesday voiced concerns about the project as it moves forward.
Details: Currently, Mission Gateway developers are asking for roughly $22 million in special obligation bond funding, City Administrator Laura Smith confirmed for the Post via email.
- They have also requested a 2% sales tax to be imposed as part of a Community Improvement District — up from a 1% CID that was part of a previous plan for the long-abandoned site — which would be used to help pay off the debt of the bond issuance.
- The city has also asked that $3 million be put in a performance escrow account as part of a new deal. That money would go to the city if the deal were to fall through, but developers have not yet agreed to that stipulation.
What else: Additionally, developers want to break this latest Mission Gateway plan into two phases: the first focused on building out the residential and retail components centered around a proposed Cinergy entertainment complex, and the second focused on a hotel and office space.
- Pete Heaven, the city’s land use attorney who is in charge of putting together the development agreement, said phase two will not be included in the final agreement at this time.
- That’s because finances for phase two, largely the hotel, are still up in the air — which developers say is a lasting effect from the hit the hospitality industry has taken from the COVID-19 pandemic.
- If both phases are completed, it would generate $26 million to the city during the 1-22 years of the incentive periods. That number drops to $20 million if only phase one is built.
Council concerns: Several governing body members on Wednesday raised concerns as the city once again stands on the cusp of going forward with a new Mission Gateway plan.
- Councilmember Debbie Kring, who has seen all five iterations of the Mission Gateway plan during her time on the city council, said her biggest concern was the financing.
- Others like Councilmember Hillary Parker Thomas asked developer Matt Valenti with Cameron Group LLC what financing looks like at this time for phase two, which includes the hotel component.
- Valenti said he can’t tell the council financing for phase two will come in a certain amount of time, but said they are “going to get it as quickly as we can.”
- Bruce Kimmel, the city’s financial advisor with Ehlers, Inc., said he plans to speak with the developers as well as the lending banks to hear their thoughts on potential increased costs and other contingencies before the city council takes a vote on the TIF and CID ordinances.
- Additionally, Kimmel said the city will not write bonds if the financial components are not pulled together.
- Mayor Sollie Flora said Kimmel’s efforts to ensure the city, developers and their lenders are on the same page is key.
Key quote: “I know we can’t control for all uncertainty but I think it’s fair to say that us, as well as the broader city community, are concerned about another false start so to speak and executing these agreements, potentially, before a bond offering stage,” Flora said. “The more we can do to shore that up I think will help bring confidence.”
Going deeper: The early draft of the development agreement includes 10% of residential units at 60% average median income, developer Matt Valenti with Cameron Group LLC told the city council.
- Valenti said the intent is to build the retail and residential portions — two apartment complexes with more than 350 units total — to earn a National Green Building Standard certification.
- Developers are shooting for a Green Globe certification for the hotel and office components, Valenti said.
- There is no plan to achieve sustainability certifications for Cinergy because it’s mostly built-out and it likely wouldn’t be able to meet qualifications necessary for a Green Globe certification, Valenti said.
Zooming out: This is the fifth iteration of a Mission Gateway redevelopment project since the Mission Mall closed in 2005.
- The city council approved the $268 million redevelopment proposal in February, about two months after developers defaulted on the 2017-approved agreement.
- Developers defaulted as a result of not completing the project by Dec. 31, 2021.
- Read the Post’s Mission Gateway history here.
What’s next in Mission Gateway timeline
The city’s planning commission is expected to consider a preliminary development plan at its Sept. 26 meeting, Smith told the city council on Wednesday.
- Two days after that, the city council is scheduled to host a public hearing on proposed public financing for the deal at a special city council meeting on Sept. 28.
- At that meeting, the city council will also consider ordinances to repeal the existing TIF project plan and CID, as well as separate ordinances for a new TIF project plan and CID.
- The city council will also consider the development agreement at the Sept. 28 meeting.