Discussions about a city-owned downtown conference center will continue, but not without ample scrutiny from city leaders.
At their work session Tuesday, Lawrence city commissioners indicated they are interested in considering a public-private partnership for a potential conference center, but that the numbers would have to back it up.
Commissioner Matthew Herbert said he has an interest in anything that would bring people downtown and into the community, but that market studies need to show that such a project would be financially sustainable. Herbert said declining attendees at a conference center in Manhattan gave him pause.
“Looking at those numbers I have some real concerns about the ability for us to sustain a conference center, and my biggest fear is we will create a conference center that the city will be required to feed in perpetuity,” Herbert said. “I need to see some real data that suggests we’re not going to have to feed this thing in perpetuity.”
The project would replace the former Journal-World production facility at Sixth and Massachusetts streets with four new buildings and an outdoor plaza, and would add a new parking garage in the 600 block of New Hampshire Street. Developers are asking the city to own the parking garage and conference center, with a contract or partnership for its operation, and provide incentives for the other buildings: a 12-story condo and apartment building; a multistory hotel and retail building; and a multistory apartment and retail building.
The former Journal-World production facility takes up most of the 600 block of both Massachusetts Street and New Hampshire Street and has been out of use for several years. The property is currently owned by The World Company, the former owner of the Journal-World. A development group led by Lawrence businessman Mike Treanor is under contract with The World Company to purchase the property.
Commissioners Lisa Larsen and Mike Amyx both agreed the city needs to continue the discussion and, if the city is involved, ensure that it follows the typical Request for Proposal process. Amyx specifically noted the size of the property and that it may be a “once in a generation” opportunity to be involved in a downtown redevelopment of that size. He agreed with Herbert that more data is needed to make that decision, and he said the city should pursue that.
A two-phase market analysis assessed the demand and projected that a conference center downtown could yield about 100,000 annual visits. But Herbert pointed out that since the first phase of that study, the conference center space at the former Holiday Inn — now a DoubleTree — has more than doubled in size. Amyx also noted that plans for a new union on the University of Kansas campus will include large event space. Commissioners agreed that those developments need to be accounted for in the market analysis and consultants said that could be done.
Mayor Leslie Soden and Vice Mayor Stuart Boley both said that community buy-in on such a project would be critical. Soden also said she is concerned that with convention centers across the state — including in Manhattan, Topeka and Overland Park — that the city is chasing a trend and could end up losing.
“It’s hard not to think this isn’t just an arms race,” Soden said.
Paul Davis, an attorney representing the developer, said what would differentiate a Lawrence conference center from those of other cities is the ability for visitors to walk out into one of the best downtowns around. Davis said the redevelopment is a gateway into the city and is something they want to make sure they get right.
“We want to be your partner and engage in the dialogue,” Davis said. “There is a lot more study that needs to happen.”
One of the main benefits touted by the development group is that a conference center would bring visitors downtown during the week. Representatives from Downtown Lawrence Inc. spoke in favor of the conference center for that reason, saying that having visitors in the downtown throughout the week would benefit downtown businesses.
Downtown grocery store
The development group led by Treanor also spoke to the commission about the downtown grocery store and apartment building, another proposed development for the same area of downtown.
The grocery story project has applied for economic development incentives, but Assistant City Manager Diane Stoddard told the commission that city staff is concerned about several issues and needs direction from the Commission.
Most notably, Stoddard said due in part to the developer’s pending effort to acquire federal tax credits for the project, not enough is known about revenue and expenditures. She said the city has found that there is likely a substantial funding gap and concerns with the incentives being requested, which include a special financing district, bond agreement and a $2.25 million “no interest or low-interest” loan from the city to help complete the project.
Commissioners indicated they also shared those concerns.
“I think the concerns raised by staff are very good and I would say ditto on all those items,” Larsen said. “The idea of loaning money to an entity, I’m struggling with that quite a bit.”
Herbert said he is certainly interested in a downtown grocery store, and that it would “solidify” downtown. However, he said he is concerned about the liability the city would take on if it were to provide a loan and that it would not be fair to other businesses.
“I would be interested in looking at other ways other than a cash loan,” Herbert said.
Amyx said that the loan request was uncommon and that it might give the project an advantage over existing businesses, which is against city policy. He said a downtown grocery store is “the final piece” and that he’d be interested in discussing other possibilities to address the funding gap.
“I hope we continue to put our heads together and find a way it can happen,” Amyx said.
Apart from the loan, Stoddard said that the bulk of the sales tax revenue generated from the new grocery store would be redistributed from local existing grocery store sales, meaning that reimbursing the developer for those sales taxes as requested would decrease the city’s revenue. Developers pointed to the overall economic benefit of adding residents to downtown.
Though not required in the downtown district, the city is also requesting that the grocery store development expand its design for a parking garage to cover all the demands for the grocery and apartment needs.