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Archive for Thursday, December 15, 2011

Town Talk: City still flirting with historic low on home construction; $4.4 million building permit issued for Poehler project; this and that about a new westside recreation center

December 15, 2011

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News and notes from around town:

• The race to 100 is still on. Lawrence building permit numbers through November are now out, and the city still has not yet cracked the century mark when it comes to new single-family home construction.

As we reported a few weeks ago, the city has building permit records back to 1956, and never in that time period has the city failed to build at least 100 new single-family homes.

If local builders are going to keep that streak alive, they’ll need to start 11 homes in December. For those of you getting out your abacus, I’ll save you the time. That means 89 new single-family homes have pulled building permits through November. That’s down 35 percent from the 137 homes that had pulled permits through November 2010.

Other facts and figures from the most recent report include:

  1. The city’s previous low when it comes to new single-family home construction was 102 units when in 2008. That was followed up by 110 units in 2009. So, if you’re keeping track, three of the worst years ever for single family home construction in Lawrence have occurred since 2008. Previously, the early 1980s — when mortgage rates were well above 10 percent — was thought to be the toughest time period for Lawrence builders. But I checked the numbers and in 1980 builders pulled 125 permits, 172 permits in 1981, and 119 in 1982. Can you imagine telling builders in the early 1980s that in 30 years interest rates would in the 5 percent range and even fewer new homes would be under construction. They likely would have told you that your feathered hair was affecting your brain.
  2. Duplex construction in Lawrence — once a hot trend — is off even more than single-family home construction. The city has issued four permits for new duplexes through November. That’s down from 10 for the same time period a year ago.
  3. Apartment construction has been an area of growth for the building industry. Builders have started 355 new apartments in the city. That’s up 61 percent from the 220 units started during the same period a year ago.
  4. The value of new privately constructed projects in the city — a key number in measuring whether the city’s tax base is growing — also is up for the year. The city has issued permits for projects totaling $100.6 million. That’s up from $80.7 million through November 2010. Two projects have accounted for $40 million of the total — a $28.5 million apartment project near Sixth and Stoneridge, and $11.3 million in construction for the Bowersock power plant on the north bank of the Kansas River.

• November’s building permit report revealed that a carefully watched East Lawrence project indeed is going to become a reality. City officials issued a $4.4 million building permit for work to begin on renovating the old multi-story Poehler grocery warehouse building at 619 E. Eight St. No, they’re not going to sell groceries out of it anymore. There just doesn’t seem to be much demand for a multi-story warehouse building these days. Instead, as we have previously reported the four story building is being converted into about 40 apartment units, with most of them receiving state financial assistance that will require them to be rented at below market rates.

There have been several starts and stops on attempts to renovate this old industrial portion of East Lawrence, but Kansas City developer Tony Krsnich seems to have found the formula. Now it will be interesting to see if there will be a bit of a rush on new development in the neighborhood. Already we have reported that the four buildings at Ninth and Pennsylvania — long ago they were Standard Oil’s office in Lawrence — are the subject of redevelopment plans. Plans call for the buildings to house offices, and perhaps be set up to host some receptions. I’m still looking for more details about that project which is working its way through City Hall. I’ll let you know when I find out more.

• Something else that I’m keeping my eyes on (besides the growing number of thank you notes my wife seems to be getting from credit card companies these days) is the idea of building a new West Lawrence recreation center. In particular, I’m hearing that a third site for a center may get a look. I don’t have all the details yet, but there’s talk that some private property near Langston Hughes elementary school may enter the mix. That is in addition to city-owned property near the Wal-Mart at Sixth and Wakarusa, and a larger tract of land that a development group led by Steve and Duane Schwada are offering to donate near the northwest corner of Sixth Street and the South Lawrence Trafficway. A recreation center can be quite a magnet for development of surrounding property, so it will be interesting to see whether others pitch additional sites to the city. The city currently is in the process of selecting an architect for the project — which still hasn’t gotten the final green light from city commissioners yet. The architect will develop some more specific cost estimates, and will evaluate potential sites. That work is expected to be completed by the summer.

• I’ve also been checking in with officials with the YMCA of Greater Kansas City. As we previously reported, city parks and recreation leaders and members of the Y were to have some discussions about whether there is the potential for a partnership between the city and the YMCA on a new center. The YMCA is definitely a fan of those partnerships. In this area they have a couple with government-owned centers in Platte County, Mo., where the government owns the building but the YMCA assumes the cost of operating the facility, and also keeps the revenue from any classes or admission fees. Even closer to home, the YMCA is working to create another such partnership in Ottawa. Various folks in Ottawa are seeking to raise about $8 million to build a new recreation center on the campus of Ottawa University. The facility would be open to all, but the YMCA would run the operations. Here in Lawrence, I don’t think the idea of such a partnership is completely dead, but I think Parks and Recreation leaders will have several questions about what the partnership would add to the community. Lawrence Parks and Recreation has a well-established set of classes and recreation programs that are more extensive than in many other communities. Whether the YMCA can offer something that is new, or whether the YMCA can make a future recreation center project less financially risky for the city are probably the big questions that will be posed.

Comments

kansasredlegs 3 years ago

Chad: How much of that $100M valuation has been given away over the next 20 years in tax abatements / incentives?

Does the new construction with these tax incentives actually pay for the increased city services they'll demand? For example, the need for fire truck(s) to reach the top floors of theses new high rises (Oread, 9th & NH projects) enjoying tax abatements while the single family homeowner gets to pay for its fire protection. If not, then growth simply for the sake of growth is not worth it.

It's easy to pull the permit numbers and the expected valuation, but I would expect you would at least report how much of that valuation was given away by our leaders. Thanks in advance for the update.

Enlightenment 3 years ago

LarryNative, there is a difference between Sect. 8 housing and below market rental. The Poehler bldg received low income housing tax credits (LIHTC), which are Federally funded-State allocated tax credits. The LIHTC program requires owners to charge FIXED rental rates that are below market, whereas the Sect. 8 housing charges on a sliding scale. Point is, renters living in the Poehler bldg will need to have employment in order to afford the rent to live in there. The Poehler project is embraced because it utilizes an existing vacant structure that will help revitalize the neighborhood.

blindrabbit 3 years ago

Drove by Poehler last week; there was a crew working on the roof using a lift on the east side of the building. Maybe just trying to stabilize the roof before any internal construction begins.

just_another_bozo_on_this_bus 3 years ago

They are installing entirely new roof trusses and decking.

history 3 years ago

What a joke, a 7 m. project would not revitalize the neighborhood. A 200 dollar outhouse would improve that neighborhood. Those people living in the Poehler buidling may be construction workers and if we dont have any construction jobs they wont have any income to pay the rent.

Look at the big picture, a 7 m. project would clean up the area, create jobs and income. Revitalize-look it up in the dictionary. To impart new live or vigor. Any project would be a great improvement to the current economy. Seriously, you embrace of federal funded project (how ever you may look at it) and reject a new 7m. building. I embrace both and reject your notion of justification.

It will be just like section 8 housing, no matter how you look at it. Trying to be reasonable with people like you is like talking to a fence post. After a while you figure out that.... well you know what.

blindrabbit 3 years ago

Drove by Poehler last week; there was a crew working on the roof using a lift on the east side of the building. Maybe just trying to stabilize the roof before any internal construction begins.

Lawrence_Pilot 3 years ago

Building permits? Well, as long as it's cheaper to buy than rent, and it's a LOT cheaper on a cost-per-sq-foot basis, people will buy and not build. Duh.

Richard Heckler 3 years ago

Buying an existing home or building a new home seems kind of risky. It may be worth less tomorrow,next month and into 12 months from now. Nationwide there are millions of vacant homes with more predicted on the horizon.

Taxpayers are losing everyday. Our city's current budget crunch could easily be tied directly to infrastructure expenses needed to serve new residential developments. The community is way over extended in this regard.

If residential growth paid for itself and was financially positive, we would not be in a budget crunch. But with increased numbers of residential you have increased demand on services, and historically the funding of revenues generated by residential housing does not pay for the services, they require from a municipality.

If 25 years of residential growth paid for itself and was financially positive, we would be receiving tax abatements instead of increased tax bills.

Richard Heckler 3 years ago

The new $15-$20 million rec center will be a tax dollar money hole. Therefore it is imperative that taxpayers are provided and opportunity to vote on the project. Let we taxpayers decide our fates.

Curtis Martell 3 years ago

Just want to tell Chad that I really enjoy your column. Town Talk is probably the best reporting in the LJW. I like that it keeps me up to date on business activity in Lawrence. The comments section, not so much. Keep it up.

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