The developer of Prairiefire in Overland Park is asking the city for an extension of a Dec. 31 deadline to start construction on the second phase of the large mixed-use development.
The Overland Park Finance, Administration & Economic Development Committee on Wednesday will consider a request from an attorney representing Prairiefire to start construction on several undeveloped acres of land between Nall and Lamar avenues along 135th Street on July 1, 2018.
That’s six months after a previous agreement to start construction this year. In a letter to Overland Park City Hall, Prairiefire attorney Curtis Peterson said Prairiefire’s development companies, headed by Fred Merrill Jr., still intend to start work this year, but requested the extension to offer “some cushion.”
Petersen cited a volatile retail market for the extension.
“As you know, many retails of all sizes nationwide are facing challenges and the retail landscape continues to change quickly,” Petersen’s letter reads. “Prior to commencing construction of any major commercial retail project, it is imperative that sufficient pre-leasing activity has taken place, which will be a precondition of any construction loan.”
“The retail environment is really changing,” Merrill said. “Tenants and landlords both are being really careful about going forward. That’s kind of the way we are. We want to make sure we pick the right people that are presenting the right product that the buying public wants to go to.”
While the stock market has generally fared well in 2017, the consumer economy is in a state of flux, particularly as it concerns storefront retail. A March 31 report by CNBC said nine retail companies sought bankruptcy protection in the first three months of the year, which matches the total amount for 2016 and is on pace for the highest number of retail bankruptcies since 2009.
Oversupply of retail space coupled with an ongoing growth in online commerce — Amazon.com’s value in the stock market is $425 billion — is putting a premium for developers to find first-to-market or otherwise unique retailers for large projects.
Prairiefire’s second phase is meant to fill in the project’s existing development at both corners of 135th Street at Nall and Lamar. That’s where Merrill built mixed-use developments that include REI, Cinetopia and Pinstripes. It also includes the Museum at Prairiefire, which hosts traveling exhibits of the American Museum of Natural History.
The forthcoming phase of Prairiefire envisions 545,000 square feet of combined retail, office and hotel development. It’s a scaled-back version of earlier plans because of a reluctance by Overland Park City Council members to approve tax increment financing.