A skeptical Land Clearance for Redevelopment Authority on Wednesday approved a redevelopment contract for developer Andrew Bolton’s plans to turn an historic building on Broadway into apartments.
Commissioners for the authority, which grants tax abatements to qualifying projects, quizzed Bolton about aspects of his plan at 905 Broadway. In particular, commissioners wondered whether Bolton paid a reasonable price — $930,000 — to justify the need for a tax-abated development project for more housing in downtown.
“We need some evaluation about the reasonableness of the acquisition price,” said Michael Duffy, chairman of the LCRA board. Commissioners on Wednesday also expressed reservations about the quality of financial analysis it receives on projects from its third-party contractor.
Nevertheless, commissioners unanimously approved Bolton’s plan, which comes with a 10-year, 100 percent tax abatement on increases of the existing property tax on the building.
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Bolton said the previous owner paid $1.8 million to buy the property.
“They took a big loss on it,” Bolton told the board.
Bolton bought the building from Waltel Properties LLC in September 2015, according to Jackson County real estate records.
Bolton said he took on higher costs for the redevelopment because he planned to spend about $400,000 to provide 11 parking spaces for tenants on the property. Bolton added that lenders felt more comfortable extending credit for a project that included parking. The remaining tenants will park off site.
Bolton also plans to build a rooftop deck at a cost of about $175,000.
About $2.1 million in financing for Bolton’s project will come from state and federal historic tax credits.
The building will maintain ground-level retail. Subway currently occupies the building’s retail space.
The project scored low on the AdvanceKC rubric, a relatively new method of evaluating development projects and their need for tax abatements and other development benefits.
Bob Langenkamp, CEO of the Economic Development Corporation of Kansas City, said Bolton’s project scored low because housing developments don’t bring in new jobs, a key metric in AdvanceKC’s evaluation. Langenkamp said policymakers are evaluating a separate development scorecard for housing projects.
In other LCRA news from Wednesday’s meeting, the board approved plans for two housing projects and one other development.
One is the redevelopment of apartment units at 3635 Warwick Blvd.
Developer Aaron Clemons of Clemons Real Estate plans to convert an existing, deteriorating and vacant apartment building into 23 market-rate apartments near Hyde Park. Rent prices, Clemons said, would range between $1,000 and $1,100.
The authority approved a 10-year, 100 percent property tax abatement to assist with financing costs.
The LCRA approved the same abatement for new construction of a 40-unit mixed-income senior apartment building at 27th Street and Prospect Avenue.
Matt Fulson, president of Fulson Housing Group in Lee’s Summit, is developing what will be called the Morningstar Senior Apartments. He said six units will be market-rate apartments, with the remaining units including rent restrictions. He plans to start construction in September and has a deadline to complete the project in 18 months.
Lastly, the LCRA approved a development agreement for the rare speculative office project in the urban core. Lynn McIntosh, a chiropractor, bought a vacant two-story building at 1707 Locust St. in the East Crossroads. She plans to fix up the property and lease it to office users.