A brick and stone building near the corner of Gillham Road and Linwood Boulevard will become commercial space and apartments under a plan to reclaim a vacant midtown eyesore.
The 30,000-square-foot building, perhaps the most rehabilitation-worthy commercial property offered for sale by the Kansas City Land Bank, has been sold for redevelopment.
Denver-based redeveloper Ilan Salzberg and Kansas City architect Caleb Buland have purchased the two-story structure, formerly known as the Mahogany Plaza, for $70,000 cash plus a commitment to shoulder about $250,000 in environmental remediation and cleanup costs.
The renovated structure will be rebranded as Acme 32, a reference to a former business use.
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Forestine Beasley, a real estate broker with Greg Patterson and Associates, said five parties had been interested in the building, which had an asking price of $203,744 as set by the Land Bank, which markets its commercially zoned buildings and land at two-thirds of the county’s assessed fair market value on the property.
Land Bank commissioners agreed to sell the property for less because of the hazardous materials abatement and cleanup commitment.
“We’re excited about the property,” Buland said. “It’s one of those eyesores that’s been there seemingly forever. We’re excited to be a part of the area’s renewal.”
Architectural plans call for 19 living spaces on the first and second floors and four commercial spaces plus a lobby on the first floor. Developers plan to add a third-floor space to become what Buland termed “a community kitchen and workout center.”
Buland said cleanup to remove graffiti and trash will begin soon, and asbestos and lead removal will begin within 45 days. The redevelopers aim to start construction this fall and be ready for occupancy in the late third quarter of 2018.
Meanwhile, the redevelopers will seek property tax abatement through either the Land Clearance for Redevelopment Authority or the Planned Industrial Expansion Authority, Buland said.
“We’re looking at maybe 10 years full abatement (on the added property value) with a short tail to bring it up to market rate, for maybe 13 to 15 years of support,” Buland said. “Whatever it ends up, it will far outpace what it brings now and will be enough to close the construction financing gap.”
Salzberg and Buland, working under the name Exact Partners, expect to put in about $4 million, about half equity and half debt.
The plan by Salzberg and Buland received a thumbs-up from the Hyde Park Neighborhood Association, which got previews of the submitted projects.
“We’re looking for great business tenants that the neighborhood would like,” Buland said. “We’ve tried to do a project that works for everyone.”
Salzberg and Buland already have purchased another midtown building with an eye toward residential renovation. They plan to convert a former Wonder Bread plant at 30th and Troost into 86 apartments with ground-level commercial space.
That ongoing project, to be named Wonder, received a 17-year tax abatement approval last fall from the Planned Industrial Expansion Authority.