After 15-year delay, Mission Gateway in Johnson County on hold again due to financing
After 15 years of delays, it seemed that progress was finally being made on the long-vacant site of the former Mission Mall in Johnson County. But just as the Mission Gateway development was taking shape, the coronavirus pandemic brought it to yet another halt.
Now leaders in Mission expect to see construction equipment leaving the site, as developers continue to face financial challenges. Construction on the $225 million project, highly visible for commuters along Shawnee Mission Parkway, will not resume as planned this summer.
“The development team has been transparent about their challenges with the project,” Mission Mayor Ron Appletoft said in a news release. “This is not where we hoped to be, but we have to respond to the realities in front of us. The city team is committed to exploring options, while continuing to protect the city’s financial interest in the project.”
The Mission Mall was demolished in 2005, but the 16-acre parcel sat empty ever since, despite efforts by Developer Tom Valenti, of New York-based Cameron Group. He previously said he struggled to get work started due to financial issues, partly brought on by the Great Recession.
Earlier this year, work finally began on the Gateway development, which includes a massive entertainment complex, a food hall, apartments, offices and shops. Crews made progress on the 90,000-square-foot Cinergy Entertainment complex, which was set to include 10 movie screens, a 16-lane bowling alley, escape rooms, zip lines and game floor.
The complex had been scheduled to open by this summer. But then COVID-19 threatened another economic downturn.
Andy Ashwal, of GFI Development, told The Star in March that construction would stall so that construction crews could be kept safe during the pandemic. He hoped work would resume this summer as the economy reopens.
But on Monday, city leaders announced that with two funding sources on hold, the project cannot move forward at this time.
Mission Gateway is funded through developer equity, private loans and city-issued special obligation bonds.
The City Council in 2017 created a community improvement district, which will impose a 1-cent sales tax at Mission Gateway to help fund development costs. The district was supposed to take effect in January 2019, but last year, the council agreed to extend the start date to July 1, 2020.
Because of the impacts of the pandemic, city leaders said Monday that “the expectation of successfully entering the bond market with the special obligation bonds came to an abrupt halt.”
“The pandemic’s impacts on the national economy, as well as statutory interest rate limitations, required that attention in the past 30-45 days has been focused on alternative approaches to securing the approved public financing,” officials said.
In addition, developers said that private financing has been put on hold due to the pandemic.
The developer is looking at options for alternative funding to continue the project as soon as possible, officials said.
This story was originally published June 2, 2020 at 6:57 PM.
