A Kansas City Council committee on Wednesday unanimously supported tax subsidies to make Cordish Companies’ Two Light luxury apartment project a reality.
“I think it would be fair to call it a milestone,” Economic Development Corp. president Bob Langenkamp said of the agreement between the city and Cordish that paves the way for construction of a second luxury tower on the south edge of downtown’s Power & Light District.
The council’s planning, zoning and economic development committee endorsed the latest agreement with Cordish, the developer of the Power & Light District. The subsidy package goes to the full City Council on Thursday for final approval.
Two Light is planned as a $105 million, 24-story apartment tower with 300 units to be built along Truman Road between Walnut Street and Grand Boulevard. It would join One Light, a 25-story, 315-unit tower at 13th and Walnut streets, which is to open in November.
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Nick Benjamin, executive director of the Power & Light District, said 109 units of One Light are already leased, with the average household income of those renters over $100,000.
Cordish expects to invest more than $88 million in Two Light. But to make the project a reality, the city is providing Cordish about $17 million, including a cash subsidy of up to $5 million for the apartment units to defray construction costs, plus a cash subsidy of between $10.6 million and $12.3 million for a residential parking garage.
City officials said the parking garage subsidy was provided for in a 2004 master plan agreement with Cordish, and the $5 million construction subsidy is needed because high-rise construction is nearly twice as expensive as low-rise. But the overall city subsidy for Two Light will be less than the city contribution of more than $20 million for One Light.
The deal also involves an effective property tax abatement of about 50 percent over 25 years.
Committee chairman Ed Ford said the cash payment from the city benefits other taxing jurisdictions such as the school district and county because Cordish has agreed to make payments in lieu of taxes over 25 years.
Benjamin told the committee that Cordish will have invested close to $500 million in downtown Kansas City since 2004, including the investment in Two Light. Construction is expected to begin in early 2016, with occupancy planned for 2018.
He said that with the streetcar and other downtown development accelerating, “we expect to see a continued influx of multifamily development downtown over the next 10 years, getting us to the goal of a sustainable downtown with 40,000 residents much more quickly than we could have hoped even a few years ago.”