The Port KC board of commissioners on Monday approved a redevelopment plan for the Jack Henry Building on the Country Club Plaza before learning who will be the primary tenant of the historic building.
Matt Pennington, president of Drake Development, came to the Port Authority of Kansas City’s board seeking tax incentives. He laid out plans for a top-to-bottom renovation for the vacant building at 612 W. 47th St. that previously housed menswear store Byron on the Plaza. It closed last fall.
He said he’s acquired a “best-in-class” entertainment tenant that plans to occupy 22,000 square feet of the 64,000-square-foot building. It will be a new concept for Kansas City, but he declined to name the tenant. Other retailers or restaurants will round out the building, he said.
The project will not receive any property tax abatement, officials said. But members of the port authority’s board voted to approve a special Port Improvement District for the building. That will have have all tenants of the Jack Henry Building impose an extra 1% sales tax on all sales to funnel back to the developer.
Mark Coulter, Port KC’s general counsel, said the incentive arrangement was different than any the agency had previously approved. But he said he believes “it sets the right tone, especially for incentive projects.”
The developer will also receive a sales tax exemption on construction materials.
After the meeting, Pennington said he expects the building to generate $35 million in annual sales — meaning the 1 % sales tax could raise some $350,000 per year.
Pennington said the tenant’s name would not be disclosed until after approval of the project. After his presentation, the board voted to approve the staff-recommended project.
Board member Dan Fowler, who represents the second district on the Kansas City Council, cast the only no vote. He was concerned that the developer had not reached out to the Plaza neighborhood ahead of Monday’s meeting.
Board member Kelley Martin said he wouldn’t expect any neighborhood push-back because the project will revive a historic building and ultimately make that area of the Plaza safer.
After the board approved the deal, they met in closed session with the developer to learn the name of the tenant. Monday’s agenda called for a closed session to discuss “legal actions, real estate transactions and personnel issues.”
Following that session, Pennington told The Star that the name of the major tenant would likely be announced in the next 30 days. He said the anchor concept will include a food component with a “scratch kitchen” and said other restaurants may fill in the remainder of the building.
Construction could start within 90 days, he said, with the anchor tenant opening in the middle of 2020.
He told the board he planned to share details with neighbors soon and that he had already discussed it with City Hall staff.
Pennington said the cost of revamping the six-story building exceeds the cost of new construction. The 1950s-era building needs asbestos abatement, sewer repairs and a basement excavation to increase ceiling heights. He plans to keep the parking structure on the upper floors, rework some of the facade and add a second tower to match the current one.
It will retain the Jack Henry Building name and signage, he said, and keep the historic character of the building.
Jack Henry was the name of an 83-year-old clothing store that shuttered in 2014, before being rebranded into Byron in 2014.
Port KC President and CEO Jon Stephens said the organization got involved in the Plaza project to save an iconic Plaza building from the wrecking ball. He stressed that the retail redevelopment would receive no property tax abatements and that the property tax and sales tax revenue on the site would increase upon completion.
“Only the users that walk into this building and purchase things from their tenants will pay,” he said.