KU Endowment asking city to pay $780,000 for 26-acre recreation center site
If a proposed $25 million city recreation center ends up being judged a good deal, it won’t be because the city got free land to build the facility.
Officials with the city and Kansas University Endowment Association have clarified that the city won’t receive a donation of 26 acres from Endowment to build the center near Sixth Street and the South Lawrence Trafficway.
Instead, the city will pay $780,000 — or $30,000 an acre — to purchase the property from a KU Endowment entity.
City officials disclosed the selling price for the first time Thursday evening, but City Manager David Corliss said the new detail doesn’t materially change the deal because the city’s overall cost for the project has not increased.
“It doesn’t really change anything, given that the purchase price applies to our $25 million maximum,” Corliss said.
KU Endowment has guaranteed the city won’t have to pay more than $25 million for its proposed 181,000-square-foot recreation center and the infrastructure needed to support it.
But because of how the city’s proposed agreement with KU Endowment — and its entity RCP LLC — is structured, it is possible for the city to pay less than $25 million. That would be the case if bids for the recreation center and infrastructure come in below estimates. By now including $780,000 in expenses for land, it is more likely the city will have to pay the full $25 million.
But Dale Seuferling, president of KU Endowment, said the association never intended to donate the property to the city.
“It is a cost of development, just like any other location,” Seuferling said.
Members of the public may not have been aware KU Endowment was seeking to sell the land to the city. City commissioners first began looking at building the recreation center on the edge of the city — rather than on a more centrally located site the city already owns near Sixth Street and Wakarusa Drive — because of an offer of free land.
Until October, the city was proposing to build the center on the northwest corner of Sixth Street and the SLT. A group led by the Schwada family had offered to donate 60 acres of property to the city.
But Kansas University officials pulled out of that partnership to locate its facilities — including a track and field stadium and soccer field — next to the city’s recreation center. Instead KU officials worked to purchase an approximately 100-acre tract on the east side of the SLT, and invited the city to locate the recreation center there.
That invitation, though, never included free land, Seuferling said. Instead, KU Endowment offered to build the city a recreation center complete with infrastructure as part of a “turnkey” package of $25 million. Seuferling said the $25 million package price always included a provision for land costs, but it was never stated that way due to the turnkey nature of the proposal.
But the city last month insisted it must back away from the turnkey proposal and instead have the center built under the city’s standard bidding process. At that point, KU Endowment created a contract for the city to buy the 26-acre lot at $30,000 an acre, the price KU Endowment paid for the land.
Seuferling said Friday that KU Endowment did not receive a donation of funds to purchase the property, and it felt it needed to recoup the amount of money it paid for the land.
City commissioners will consider approving an agreement to proceed on the recreation at their 6:35 p.m. meeting Tuesday at City Hall.