The Mission City Council on Wednesday approved a development plan for the long-stalled Mission Gateway project, a move that gives the mixed-use project a bundle of incentives to assist with the $200 million project.
Wednesday’s vote is a big step for Tom Valenti, the New York developer with the Cameron Group that bought the former Mission Mall site at Shawnee Mission Parkway and Johnson Drive and knocked it down in 2005, but in the 12 years since has not been able to build anything on the 16-acre site.
The development agreement holds Valenti to an Oct. 31, 2018 deadline to start work on the first of three phases for the Mission Gateway project. The first phase is 170 market-rate apartment units, and small retail shops underneath.
“This has been a long tough row to hoe,” Valenti said. “But I believe that we are right at the starting line for great success.”
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Future phases of Mission Gateway contemplate two hotels, a 45,000-square-foot office building and up to 190,000 of larger retail, restaurant and entertainment space.
Still, several questions remain for Mission Gateway.
▪ When will the developer actually break ground on a project that has a long history of false starts? Valenti has a year to get going, but said would like to start as soon as possible.
▪ When will the developer get caught up on more than a year’s worth of delinquent property taxes at the former Mission Mall site? Valenti said he will pay up on property taxes when he closes on his construction loan.
▪ What retailers will occupy Mission Gateway, and when will the developer reveal them?
The question of retailers became a point of contention for Ron Appletoft, a Mission council member who is running unopposed for mayor in November. Appletoft asked several times why the city is voting on incentives when Valenti couldn’t tell the council about any roster of tenants.
“Why are we stepping forward to make this commitment?” Appletoft said. “Why can’t we wait until you have the commitments you need and we can jointly agree and know what we are voting for?”
Valenti said he can’t disclose who he’s negotiating with until agreements are signed. He did offer a few clues about the large retailer that would occupy the largest retail component of the plan. He suggested it was a type of retailer that was “internet proof.” In other words, the type of unique retail establishment that could withstand the pressure on traditional bricks-and-mortar retailers face from online shopping.
“We are looking at a large-scale food, entertainment, market concept that is going to be architecturally stunning,” Valenti said.
Appletoft did not appear to be convinced by Valenti’s descriptions. He voted against the development deal, along with council member Arcie Rothrock.
“This is the last opportunity for the city to assert any kind of control on this project,” he warned other council members.
Valenti’s latest plan did win over the majority of a city council that has in the past been skeptical about his vision with Mission Gateway. Appletoft and Arcie Rothrock voted against the development agreement and the incentives that come with the project.
Valenti over the years has presented several versions of mixed-use development plans for the former mall site. At various points, condos, hotels, office buildings and a massive aquarium have been offered up by Valenti and the Cameron Group, but none to date ever materialized.
He for years tried to get construction going with a plan to anchor Mission Gateway with a Walmart Superstore, which proved unpopular the Mission residents and ultimately the city council. Walmart and Valenti eventually couldn’t come to terms on a deal, anyway, and this latest plan arrived to the council earlier this year.
The incentives on the plan include tax increment financing, a tool that captures future increases in property and sales taxes to pay certain development costs. Also included in the incentive package most of the city’s guest tax generated by the hotels at the project, a community improvement district that adds an additional one cent sales tax on existing state and local sales taxes on Mission Gateway, and a sales tax exemption on construction related costs.
Mission officials said the financing package helped the city mitigate risk associated with the project. For one, there’s no city guarantee of debt for the project, meaning the city isn’t on the hook to pay off bondholders if the project goes under.
Also, the incentive structure means the city shares in some of the sales taxes generated by Mission Gateway from the outset. Mission will pick up 11 percent of the transient guest taxes generated by Mission Gateway for 20 years, and then 45 percent of general sales taxes for the same period of time.
Mission forecasts it will start collecting an additional $545,000 from the project in 2021, its first full year of operation. In the context of Mission’s nearly $12 million general fund budget, the additional revenue could be helpful.
Pete Heaven, a private attorney for the Spencer Fane law firm who advises Mission on land use issues, said he thought the Mission Gateway protected the city’s interests.
“I have no reservations in telling you this is a good deal,” Heaven said.
After the meeting, Valenti and his partners chatted with Mission officials.
Valenti’s son and business partner, Matt Valenti, gave Mission council member Nick Schlossmacher a handshake and a promise.
“I won’t let you down Nick,” he told Schlossmacher. “I won’t let you down.”