Archive for Sunday, August 10, 2014

Proposed shopping center near SLT faces uphill battle at City Hall

August 10, 2014


A plan to build the community’s largest shopping center has a large hill to climb if it hopes to win approval at Lawrence City Hall.

A majority of city commissioners recently told the Journal-World that they have concerns about a proposal to build a little more than 500,000 square feet of retail, restaurant and hotel space on a site just southeast of the South Lawrence Trafficway and Iowa Street interchange.

Driving that concern is another project: The Rock Chalk Park sports complex. The city is investing $22.5 million for the sports complex near Sixth Street and the South Lawrence Trafficway. The northwest Lawrence intersection adjacent to Rock Chalk has been zoned for about 600,000 square feet of retail and commercial space, but so far retailers haven’t come to the sites. Commissioners worry that if a new south Iowa Street shopping center is built, it will be years before retailers ever locate in northwest Lawrence.

“The city has made a large investment at Rock Chalk Park,” City Commissioner Jeremy Farmer said. “We’ve really already put our eggs in the basket that we’re expanding out west.”

A representative with the south Iowa development said his firm is still trying to decide whether to ask city commissioners to vote on the project. The Lawrence-Douglas County Planning Commission dealt the project a setback last month by recommending denial of the project, but ultimately city commissioners could still choose to approve it.

“We believe we can provide a project that is good for the community,” said Chris Challis of North Carolina-based Collett & Associates. “We were surprised by the protectionist approach we encountered. We think the situation is kind of misunderstood.”

Retail competition

Challis said he doesn’t think his company’s Southpoint proposal is doing anything to hold back the northwest development, which is known as Mercato. His company has announced that Old Navy, Designer Shoe Warehouse, Academy Sports, Marshalls, Ulta Beauty and others have said they want to be tenants of the center. He said the Mercato site was available to those retailers, and would have allowed them to open significantly earlier than the 2016 projected opening of Southpoint.

“I think people need to ask themselves, if a retailer has selected this market and wants to be open as soon as possible, why wouldn’t they select the site that is most readily available instead of waiting two years for our site?” Challis said. “Mercato beat us out of the gate. If they had a site those retailers wanted to be at, why wouldn’t they be there?”

But commissioners said that sort of logic doesn’t take into account how dramatically the area around Rock Chalk Park is going to change. The city’s 181,000-square-foot recreation center will open in September, and the complex also will host softball, soccer and track events for Kansas University. Leaders hope the facilities will attract both regional and national level youth sporting competitions that will bring thousands to town.

“There is housing that is being built out there too,” said City Commissioner Bob Schumm. “I think when the recreation center opens you’re going to see a whole new level of demand for services out there. I think we all just need to sit back, relax a little bit and see what happens.”

Matters of money

But the Southpoint proposal comes at a time when city officials particularly are in need of new tax dollars. Commissioners approved a property tax rate increase as part of the 2015 budget, and are expected to ask voters to approve a sales tax increase in November to fund a police headquarters.

Southpoint officials have produced a study that estimates the shopping center would add $132 million in retail sales to the community, which would add $1.1 million a year to the city’s sales tax collections in 2016 and $2.1 million by 2020. There has been a debate, though, about how many of those dollars would be new to the community and how many would come at the expense of existing retailers in town.

Some commissioners are convinced the Southpoint project would significantly cut down on the amount Lawrence residents travel to Kansas City or Topeka to shop and would add to the city’s coffers.

“That is the serious concern I have in not allowing this development,” said City Commissioner Mike Dever. “We have raised the mill levy. We may increase the sales tax rate. There is a lot to be said for instead just increasing the amount of dollars spent here in the community.”

But Dever stopped short of saying he could support the Southpoint project as proposed. He said he thinks it is undesirable for a community to have the bulk of its retail concentrated on one end of town. He said he thinks the Southpoint project would have to be reduced in size before it would get serious consideration from the City Commission.

Challis said the company is considering submitting a smaller proposal. But based on other comments from commissioners, it is not clear that a smaller proposal would win approval. Dever said there is a key question that is tough to answer: How long will it take for the northwest Lawrence area to develop?

“If we think it is going to happen soon, it probably is wise for us to hold off on approving a development to the south,” Dever said.

A matter of time

The Mercato group — which is led by members of the Fritzel and Schwada families — haven’t been able to say when the project may begin attracting retailers. Pat Peery, a veteran retail site selector, recently has been brought on board to broker the project. Peery said he didn’t have any specific tenant news to share.

“We are working really hard on the design of the site to make sure it takes full advantage of Rock Chalk Park,” said Peery, who is with Lane4 Property Group in Kansas City. “We need to get aggressive, and we are being aggressive.”

City commissioners seem split on how much time they should wait for Mercato to develop. It has been zoned for retail development for more than six years, although part of that time period was during the Great Recession when retail deals were few and far between anywhere.

Farmer said another six years of no retailers likely would require the city to again consider expanding to the south. But City Commissioner Terry Riordan said he has a much shorter timeline in mind.

“If we say we’re never going to build on the south side, I think that would be a mistake,” Riordan said. “I think it is reasonable to give people a year or two to do something on the west side. If they don’t have something done in 12 to 24 months, then we ought to reconsider it.”

Peery said he has heard that message.

“A year is a long time,” he said. “We had better have deals in that time.”

Commissioners also indicated the terms of those deals will be important. The developers of Southpoint have said they don’t intend to seek any financial incentives from the city. A majority of commissioners said they aren’t interested in providing financial incentives — such as tax increment financing or special taxing districts — to attract retailers to Mercato.

“I think they have gotten all the momentum they are going to get from us,” Riordan said. “The rest has to come from them building something.”

Peery said he didn’t want to comment on whether a future Mercato deal would need financial incentives from the city.


Philipp Wannemaker 3 years, 9 months ago

So instead of accepting something now with willing participants, we should wait and see when and if anyone wants to build in NW Lawrence. But I think we also need to note who owns the current city council.

Sue McDaniel 3 years, 9 months ago

So they build a sporting park out in a cornfield with no vote (still not sure what percentage of the population is benefited by that) and now want to force other business out there to support it? I think businesses usually have a decent idea of their best chance of success. Lawrence has been so unfriendly to so many I do not know why they would want to come here.

Jim Schilling 3 years, 9 months ago

I see the point of wanting to expand retail options to the west, after all we are on the hook for ~25 million out there so I suppose growth better be more than living space. On the other hand if we are trying to develop a "corners" approach to major retail then why is there not focus on the other corners? Why not say no to more grocery stores on the west side until it develops on the east and north sides of town where the options are spread FAR more thin? I did a Google map route to the Rock Chalk Park and then to Oak Park Mall from my house which is on the far east side. Less than 5 minutes difference driving time according to the map. That of course doesn't take K-10 being done into account which will reduce the time to the west by a good 10 minutes I imagine, but there isn't a great deal of difference in drive time and there are closer retail spots in JoCo than Oak Park.
I get that we aren't trying to replace a large metro worth of locations with one development but there is no incentive for me to consider going west.

Amy Varoli Elliott 3 years, 9 months ago

You can get from one side of Lawrence to the other without the STL in about 15 minutes, the city is pretty small

Richard Heckler 3 years, 9 months ago

Southpointe will fail thus join the long list of malls that have become dinosaurs.

Philipp Wannemaker 3 years, 9 months ago

So from 23rd & Harper, about as far east as you can be to Oak Park Mall is approx 29 min and 29 miles. To Rock Chalk 1s 17 min and 9 miles. To proposed development is 13 min and 6 miles. And you would rather drive at least 40 added miles round trip, for what?

Jim Schilling 3 years, 9 months ago

By no means do I want to, nor do I drive the extra miles. I haven't been to Oak Park Mall in more than a decade at least. I am a lifelong Lawrencian and in reality find that there is plenty for me here based on my needs. I would like a grocery option closer to home but Dillon's on Mass St isn't that far away. I'm right off 25th and O'Connell, that is the farthest east you can be right now, just a skosh further than Harper. :) Amy, it depends on where you are going if it takes 15 minutes. From my home to the Rock Chalk Park it takes more. K-10 will shorten it considerably but going through Lawrence would require some luck with traffic and required stops to be there in less than 20 as things exist right now. Is that a big deal? No. Does that mean development should be forced there? No.

Bruce Bertsch 3 years, 9 months ago

The folks who do research for retailers aren't stupid. They know what is going on at Rock Chalk Park and still they chose South Iowa. Maybe the commissioners should wake up and smell error of putting all their eggs in the Fritzel/Schwada basket to the Northwest. The Mercato site might work for those visiting Lawrence for events, but it may not be convenient unless you are coming here from Topeka or Lecompton.

Cille King 3 years, 9 months ago

There were also retail reports done for the Riverfront Mall and Tanger Mall.

Why would anyone come to Lawrence for strip retail shopping from Topeka or Kansas City? We can never compete with the larger cities/larger markets for the same stores that have their larger stores in the larger markets.

Fred Whitehead Jr. 3 years, 9 months ago

And the "rich" part of town (the west side) should benefit and the rest of the city can go to hell.

The "rest" of the city shops at Wal-Mart, Target, Michaels, etc. Great plan!!!!!!!!!!

Don Zimmer 3 years, 9 months ago

"Do as I say, not as I do" A prime example is the cities site selection for a new police station. Even though they already own several sites with infrastructure and "shovel ready" tthey want another site with neither because it fits their criteria better. yet when a developer requests the same they ignore that.

Second as a retail centers owner in the midwest all signs and companies report that the day of the "corfield mall" is over and site selection is more infill and closer to roof tops and existing synergy.

Cille King 3 years, 9 months ago

I'm all for infill. Let's infill in the city. Let's not put new asphalt and concrete over green space in the flood plain, beyond the edge of town.

Richard Heckler 3 years, 9 months ago

This is all about selling a piece of real estate NOT improving our quality of life.

Malls an the like become dinosaurs quickly because they are not sustainable. Lawrence,Kansas is surrounded by giant mall opportunities and we taxpayers know where they are if we need one. We don't need them everyday that's for sure.

Let’s support our existing retailers and their employees instead of cutting into their economic growth.

Too much of anything stimulates economic displacement which is unfriendly to business and unfriendly to taxpayers. An initial $1.4 million in sales tax, growing to $2 million by 2020 is nothing but rosy speculation.

Planning-must respect community vision - by Candice Davis

We could be a vibrant, dynamic, somewhat progressive city because the Lawrence majority want to remain unique instead of becoming among the communities that choose the cookie cutter image.

Supporting our existing retailers and their employees instead of cutting into their economic growth is fiscally responsible.

Again supporting our existing retailers and their employees instead of cutting into their economic growth is fiscally responsible.

Southpointe will fail…..Lawrence,Kansas has plenty of retail failures in the history books.

Richard Heckler 3 years, 9 months ago

Why would any retailer want to locate in Lawrence,Kansas knowing the city government and the Chamber will only try to cut into their economic growth ASAP all in the name of selling another piece of real estate.?

The retail $$$$$ are not here.

Downsized stores are not exciting and offer fewer choices. Voice of experience. They suck.

Let's don't get duped again.

When we located to Lawrence nearly 30 years ago we realized there was not a shopping center on every corner. A big reason we chose Lawrence,Kansas.

We also realized if we could not find what we wanted in Lawrence... KCMO metro is not that far away……. we are happy about that. Drawing up a "grocery list" for what we want or need and heading out to KCMO is usually a fun experience so why not.

If we would have wanted all of the polluted air,traffic and shopping centers galore that come with a big city we would have located in a big city. We don't need or want this big city stuff in our everyday lives.

Supporting our existing retailers and their employees instead of cutting into their economic growth is fiscally responsible.

Clark Coan 3 years, 9 months ago

"I'm all for infill. Let's infill in the city. Let's not put new asphalt and concrete over green space in the flood plain, beyond the edge of town."

Exactly. Sprawl doesn't pay for itself. In fact, it costs taxpayers 2.5 times more than planned urbanism.

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