Entries from blogs tagged with “Town Talk”
A talk with the newest Douglas County commissioner about the timing of jail expansion election, and how voters may be inundated with ballot questions in 2017
Surely you all have started to have election withdrawal by now. The symptoms include a smile on your face and giddiness. Well, fear not, 2017 is going to have plenty of local elections. In fact, in some ways, it may have too many.
As part of my series of conversations with local leaders, I met recently with new Douglas County Commissioner Michelle Derusseau. The big takeaway from our chat is that Derusseau is not yet convinced it is a good idea to have an election in 2017 to seek taxpayer approval for a jail expansion and mental health crisis center.
“I don’t know yet,” Derusseau said when asked whether 2017 was the year the approximately $40 million jail and crisis center project should be put to voters. “It is going to be a tough year to do it. I can say that.”
There are at least two factors that may make 2017 particularly challenging for the jail issue. The first is that there are already visible signs of opposition to expanding the jail. There are two groups actively working to convince leaders that a jail expansion shouldn’t be undertaken now, but rather alternative efforts to incarceration need to be further explored. If you are keeping track at home, they are the faith-based group Justice Matters and a separate group that is affiliated with the nonprofit Kansas Appleseed Project. Organized opposition before an election date has even been set is always a red flag, but certainly not insurmountable.
Issue No. 2, though, is that by the time Douglas County commissioners conceivably could be prepared to put this on the ballot, Douglas County voters may already be tired of supporting tax increases for projects. That’s because the Lawrence school district is positioned to beat everybody to the punch in asking for a tax increase. As we have reported, the Lawrence school board has authorized a May 2 election for an $87 million school bond issue that likely would increase property taxes by about 2.4 mills.
If the county decides to ask voters to support a tax increase for the jail project, it won’t happen before that May 2 school election. So, the county would be at least second in line, and that usually is not the best political position to be in. If voters approve $87 million in school funding, are they going to be eager to approve another tax increase in such short order?
A wild card in all of this is that it is possible there might be yet another tax issue for voters to decide. The city has three sales taxes that will automatically expire unless voters in a citywide election agree to extend them. There is one sales tax that helps fund the city’s road and infrastructure repair program, and two taxes that provide the bulk of the funding for the city’s public transit system.
The taxes are not set to expire until early 2019, but conventional thinking is that city officials will want to know well in advance of that date whether they can count on the sales tax funding for the future. City officials will start putting together the 2019 budget in about May 2018. That has caused some people to wonder whether the city would ask voters in late 2017 to extend the sales taxes, giving the city more time to plan in case voters reject the sales taxes.
I haven’t heard anything definitively from the city on what its plans are for a sales tax election, but we’ll start asking more questions about that soon. Regardless, whether it is this year or early next year, it seems likely Lawrence voters will be participating in a sales tax election. To summarize, that would be three big taxing decisions for voters to make in a short time period: $87 million in school bonds, $30 million to $40 million for jail and mental health improvements; and a decision on whether to renew sales taxes that total 0.55 percent.
Derusseau, who took office in early January, said she’s not sure how voters would react to so many taxing issues in such a short time. Instead, most of her comments were focused on how she thinks many members of the public still need more convincing on the jail expansion.
“I know we are going to need the time to make sure we educate voters on the need,” Derusseau said.
Derusseau said there are unanswered questions about both the jail expansion and the construction of a mental health crisis intervention center. How that mental health facility would be staffed and how it would operate are key questions. Some of the answers are still fluid. Case in point, if Lawrence Memorial Hospital decides to become more involved in mental health care, that could cause the crisis intervention center to look different. Derusseau said county officials are having discussions with LMH.
“How the hospital could be involved could change everything,” Derusseau said. “We really need to look at everything. I think there is a lot of work to do to make sure the right message is out there.”
Other takeaways from my conversation with Derusseau included:
• The city has been going through a strategic planning and visioning process, so I thought it would be interesting to get Derusseau’s take on what Douglas County’s vision ought to be. Derusseau mentioned several things, but came back to the idea of using the county’s diversity to its advantage.
“There ought to be a way for us to market that we are a community for everybody,” Derusseau said.
She noted that the county has a variety of city types, ranging from the almost 100,000 population of Lawrence to the approximately 600 people in Lecompton. She also noted that Douglas County still has a much different feel than many places in the Kansas City metro.
“There are a lot of places in Johnson County where it is a 20- or 30-minute drive to get out into the country,” she said. “It is not that way here.”
• On economic development, Derusseau said she does have concerns about local governments adopting a bunch of new policies that may cause potential companies to scratch Douglas County off their search list early in the process.
“Getting businesses to come to your community is not like it was in the old days,” Derusseau said. “They start with such a large number of communities now. You have to get the site selectors here to visit. You don’t want to do something to get yourself eliminated early on. We have to figure out a way to get people here to see our communities. We have nice communities. We have safe communities.”
Derusseau said she thinks there is a lot of good growth going on in the community, and she said it is important to keep that growth continuing. Growing the county’s tax base will become more critical as state resources continue to become less certain.
“The more business-friendly we can be, the better,” she said.
• Derusseau said the county will soon have to figure out how to deal with the state’s new concealed carry law, which will allow people to carry concealed firearms into many public places beginning July 1. Governments can prohibit concealed carry, if they take adequate security measures, such as metal detectors at the entrances to public buildings. Derusseau said figuring out how to secure the Bert Nash Mental Health Center and other agencies that are in the Lawrence-Douglas County Health Department building is one of her priorities.
When I was in college, pizza, beer and abacus stores were the most likely type of businesses to locate next to the KU campus. In a sign of changing times, I’ve gotten word that the first two tenants in a new retail development next to KU will be an international coffee house and a unique shop that sells fancy fruit.
Two deals have been signed for retail space inside the massive HERE apartment complex at 11th and Indiana streets, Allison Vance Moore, a broker with the Lawrence office of Colliers International, told me. Topeka-based PT’s Coffee Roasting and Edible Arrangements have signed leases to locate in the building’s commercial space that fronts Indiana Street, according to Moore, who brokered the deals.
Look for more commercial businesses to come. The building — which has apartment space totaling more than 600 bedrooms — has about 5,000 square feet of commercial space along Mississippi Street, and Moore said she’s already got about half of that space leased. No word on what tenant will go into the location, but the Mississippi Street space — which is right across the street from Memorial Stadium — has been marketed to restaurants.
As for the two confirmed tenants, let’s start with the fruit. Edible Arrangements is a shop that sells “bouquets” of fruit. Francis Katzer owns the Topeka franchise, and will be opening the Lawrence store, hopefully by March 1, she said.
Katzer challenged me to think of all the times I’ve needed to buy flowers. OK ... birthdays, apologies for forgotten birthdays, anniversaries, apologies for forgotten anniversaries and several other things that I’m sure I will remember once my key no longer opens the front door. Well, for all those things, I could have bought a bouquet of fresh fruit instead of flowers. Katzer has a simple argument of why that’s a good idea.
“Flowers are pretty, but you don’t eat them,” she said.
She promises that the fruit bouquets will be pretty too. Pineapples are made to look like daisies. Strawberries, melons, grapes and other fruits are manipulated to look like plants and flower arrangements too. Plus, the store stocks gourmet chocolate that is used to dip strawberries, apples, bananas and other fruit.
Katzer has had the Topeka store for about four years, and she said it received a lot of orders from Lawrence, so much so that the store started delivering to Lawrence once a week. When the spot near the KU campus became available, she decided to expand into the city. In addition to the fruit bouquets, the store will sell fresh fruit smoothies and frozen yogurt.
Next, the coffee house. PT’s Coffee Roasting is Topeka based, and, yes, I did call it an international coffee house. Sometimes the proposals coming out of the Statehouse in Topeka sound like they’ve come from Make Believe Land, but that is not the international aspect I was referring to. Instead, I’m talking about how the company gets coffee beans from around the world, roasts them, then gains international recognition for its work. The company has been named roaster of the year by Roast Magazine, and it sells its coffee beans in shops, restaurants and select grocery stores nationwide.
PT’s, however, only operates two coffee shops of its own — one near the Washburn campus in Topeka, and one in the Crossroad District of Kansas City. I’ve got a call into the folks at PT’s, but haven’t yet heard back from them. So, I don’t know an opening date or details about what the shop plans to offer. Both the Topeka and Kansas City locations have breakfast and lunch menus with lots of grab-and-go items like sandwiches, pastries, breakfast burritos and other such items. The Topeka location also has a bar that serves microbrewery beer, wine and specialty cocktails. No word yet on whether the Lawrence location will have a bar.
UPDATE: I heard back this afternoon from Jeff Taylor, president of PT’s. He said renovation work on the space is expected to start soon, and he hopes the shop opens in March or April. Taylor said PT’s recently decided it wants to have more retail locations, but Taylor said the company made a decision to stay off of Lawrence’s Massachusetts Street.
PT’s provides coffee to shops in 32 states, and some of those shops are in Downtown Lawrence. He said he didn’t want to open a shop in Downtown Lawrence for that reason. But when the space became available in the HERE building, he thought that would be a way to enter the Lawrence market without competing against his wholesale coffee buyers in Lawrence.
In addition to coffee, the Lawrence location will carry several grab-and-go items for breakfast and lunch. It also will have a small selection of beers on tap, but Taylor said the location doesn’t have any interest in becoming a bar. He said the establishment likely will close at 8 p.m. or 9 p.m. on most nights.
PT’s will be at the space right at the corner of 11th and Indiana. Edible Arrangements will be in space farther along Indiana Street.
As I hear more about the other businesses going into the building, I’ll let you know.
Lawrence housing market posts increase for 2016, home prices rise; question about whether homeowners will see higher property tax values
The final numbers for 2016 are in, and real estate agents sold 1,210 Lawrence homes. From the podium, though, it looked like at least a million to a million and a half. (Sorry, I couldn’t resist.) Either way, it was enough for Lawrence to post its fourth consecutive year of growth in home sales.
The new report from the Lawrence Board of Realtors shows home sale totals grew by 2.2 percent compared with 2015 marks. That’s not a record-setter by any means, but there were times in 2016 that it was questionable whether the market was going to grow at all. So, real estate agents are likely happy with the end result.
Here’s a look at how this year’s home sale totals compare with previous years:
— 2016: 1,210, up 2.2 percent
— 2015: 1,184, up 11.4 percent
— 2014: 1,063, up 0.2 percent
— 2013: 1,061, up 17.2 percent
Some of the more interesting numbers in this report are on the pricing front. The end-of-year numbers show the median selling price of a home in Lawrence was $178,000. That was an increase of 5.3 percent from the 2015 median of $169,000. Here’s a look at some recent history on median selling prices in Lawrence.
— 2016: $178,000, up 5.3 percent
— 2015: $169,000, up 1.2 percent
— 2014: $167,000, down 1.8 percent
— 2013: $170,000, up 6.6 percent.
A couple of things you may notice about those numbers are that the housing market did seem to break through a bit of a ceiling in 2016. The market hit a recent high in 2013 with a median selling price of $170,000. Then it dropped in 2014, and home prices weren’t able to increase enough in 2015 to get the median equal to or above the old high. The market gained back all of its losses plus some in 2016. The other notable trend is that Lawrence now has had two consecutive years of increases in selling prices. It will be interesting to watch whether that trend starts showing up in the tax values that the county appraiser assigns to each home. Those tax values are supposed to be based on the fair market value of homes, and while homeowners may not want to see their tax values increase, local governments are likely eager to get the additional tax revenues that higher values would produce
The rising price of housing, though, was most evident in the new construction market. The median selling price of a newly constructed home rose to $324,900 in 2016, an increase of 6 percent from 2015 values. Since 2013, the median price of a newly constructed home has risen by 8 percent, while the median price of existing housing stock has grown by 4.7 percent. The figures illustrate some of the difficulties the city may face if it has an affordable housing strategy that is heavily reliant on new construction. The numbers also show the new construction market struggles to build smaller, more entry-level homes. The difference in price between an average existing home and the average newly constructed home is nearly $150,000. Obviously, the new stuff that is getting built is a lot bigger, and perhaps fancier, than the older housing stock.
But despite the rising prices, sales of newly constructed homes posted their best totals in a long time. Real estate agents sold 99 new homes in 2016, a 22 percent increase from 2015.
Here is a look at a few other statistics from the end-of-year report:
— The median number of days an existing house sat on the market before it sold was 16. That’s the shortest time period in recent memory. In 2013, existing homes were on the market for 40 days on average. The number has been falling ever since. The statistic shows the market becoming more and more of a sellers market.
— There are mixed signals on the new construction front. While more newly constructed homes sold in Lawrence than in past years, they took longer to sell. The median number of days a newly constructed home sat on the market before selling was 94. That’s up significantly from the 76 days in 2015. As local homebuilders decide how many houses to build in 2017, they may be trying to figure out what statistic to put their faith in: an increasing number of sales or a slowdown in how long it is taking to sell a home.
— The year ended with 180 homes actively on the market. That too is a recent low. At the end of 2015 there were 240 homes on the market. At the end of 2013 there were 303. The shrinking number of homes on the market is a main factor driving up prices in the market, local real estate agents tell me. Unless something changes in the market — and who knows, facts and “alternative facts” could produce a shift — the low inventory of homes for sale makes it likely that Lawrence may see a third year of price increases in the real estate market.
In other news and notes from around town:
• If you are wondering whether the Douglas County Appraiser is going to attach a higher tax value to your home, you’ll have to keep wondering a bit longer. The county will send out its change of value notices on March 1. But the appraiser’s staff currently is going through the process of assigning a tax value to the approximately 40,000 real estate parcels that exist in the county.
County Appraiser Steve Miles put out a report recently updating the process, but he didn’t provide any firm guidance on what homeowners should expect. But it sure sounds like some sort of increase in tax values is in play.
“When the entire year is analyzed, there has been upward movement in the overall market value of existing real property over that period,” Miles wrote in the report. “As staff proceeds with the process of establishing the valuations for Douglas County properties, we are seeing an upward trend in total valuations on average.”
But Miles did not offer guidance on how large of an increase in values his staff is seeing. In a separate part of the report, Miles notes that through November, the average sale price for residential property throughout Douglas County was $214,895, which was up about 1 percent from the 2015 average. These numbers look different from the ones above for a couple of reasons: 1. They are for the entire county. 2.The appraiser uses a mean average instead of a median average. (No, I’m not going to explain the difference. You should have paid attention in math class.)
The appraiser’s office is scheduled to wrap up its annual review of values in the next couple of weeks. We’’ll check in with the appraiser after that to see if we can get a better idea of what homeowners should expect.
East Hills Business Park manufacturer files plans to expand; an update on enrollment growth, possible new programs at city’s vo-tech school
In my house, when you want to add some bling to a package, equip my wife with a Be Dazzler and take to the root cellar to avoid the rhinestone explosion that is to come. In the world of industrial packaging, though, you are more likely to turn to Lawrence-based API America, and I’ve gotten word API is expanding its local bling-producing operations.
API officials have filed plans with City Hall to build an approximately 11,000 square-foot, $750,000 expansion onto its manufacturing facility at East Hills Business Park. Jaime Bryant, vice president of operations for API, confirmed to me that the expansion likely would result in three to five new jobs at the plant, which is located at 3841 Greenway Circle. The company currently has about 100 employees at its Lawrence location.
If you are still confused about what API actually makes, think of some of the shiny products that are used on packages these days. The company’s website says the firm specializes in making foils, films, laminates and holographic finishes that are used on labels, cartons, containers and other such packages. Among its clients are some of the big names in the liquor, candy, tobacco, perfume and cosmetics industries. I don’t know what the case is today, but previously I was under the impression that a good amount of product also got shipped across town to the Lawrence Hallmark plant that is the primary producer of greeting cards in North America. The company serves a variety of industries, Bryant said.
“Just about anything that you want to add a little bling to your packaging, that is what we make out here,” Bryant said.
The new space will be devoted to additional production, Bryant said. The company has long had operations in New Jersey, but the company for several years has been considering consolidating more of its work at the Lawrence plant.
As part of the project, the company also will be moving some of its distribution and warehouse space out of the East Hills Business Park and into vacant space at the Peaslee Tech building near 31st and Haskell. Peaslee Tech — the vo-tech center operated by local economic development entities — is located in the former Honeywell Avionics manufacturing facility. Peaslee Tech occupies only a portion of that building. A key part of Peaslee Tech’s funding strategy is to lease the vacant space to private companies.
Marvin Hunt, executive director at Peaslee Tech, said API has signed a lease for nearly 23,000 square feet of space. API will occupy about all the vacant space in the facility, except for about 15,000 square feet that Peaslee Tech is reserving for future expansion of the vo-tech center.
“Having API as a tenant will help stabilize our finances for the next several years,” Hunt said. “We can really count on them as a good partner for a lot of years.”
Bryant said API hopes to have the expansion project completed in about 18 months. The property already is properly zoned to accommodate the industrial project. The development just needs some technical site plan approvals from the city’s planning and development services department.
In other news and notes from around town:
• Since I’ve mentioned Peaslee Tech, now seems like a good time for an update on the vo-tech center. Hunt tells me that the center has a little more than 300 students — both the high school and adult variety — enrolled for its vocational programs this spring. That number is steady from the fall semester, but is up from about 150 students at this time last year.
Hunt is projecting that next fall’s enrollment will be between 350 to 400 students. He said the center likely will have two new programs to offer students: an automotive repair major and a program to train people wanting to work in power plants, green energy or other utility fields.
We’ve reported on the automotive initiative previously. A group of local auto dealers has committed funding to the project, and Hunt is now seeking to secure some additional support from auto parts stores, automotive repair shops and other similar types of businesses. The center hasn’t yet begun construction of the new laboratory space that will be needed for the automotive program, but Hunt said a request for proposals will be issued in the next couple of weeks.
On the power plant program, Hunt said Peaslee Tech is in serious discussions with Emporia-based Flint Hills Technical College to bring its power plant technology program to Lawrence.
“That program helps people gain careers in areas like gas, hydroelectric, solar and nuclear power plants,” Hunt said. “We’re really looking at all the companies associated with utilities and the potential that exists there.”
The center currently is undergoing several construction projects. Work is concluding on the remodeling of nine offices and a conference room to house the operations of Douglas County senior services while its longtime home next to the Lawrence Public Library prepares for renovations. The center also will be installing fire sprinklers in the warehouse area that API is leasing, Hunt said.
Update on the future of East Lawrence’s debated Quonset hut; longtime Lawrence chef joins local brewery project; more plans for affordable housing
Yesterday I told you about plans for a pair of new, architecturally interesting apartment buildings that developers hope to construct in East Lawrence’s Warehouse Arts District. Today, I have news in the same neighborhood about another piece of interesting architecture: the old Quonset hut-like building at the former Black Hills Energy site.
You perhaps remember it. The old metal building is across the street from the Poehler Lofts building near Eight and Delaware streets. Black Hills Energy once tried to tear the building down, but some neighbors and historic preservationists objected. Some people think a Quonset hut is a good example of period architecture. Other people think Jabba the Hutt is more appealing. (To not offend either Quonset or Jabba the Hutt, it probably is best to call this building Quonset hut-like. It is not a Quonset brand, but looks similar.)
Regardless, the property has a new owner. A group led by Lawrence businessman Adam Williams has purchased the old Black Hills Energy maintenance yard near Eighth and Delaware streets.
Williams told me he doesn’t have any plans to tear down the building. He said, at the moment, he doesn’t have any real long term plans for the property. He said he thought it would be a good investment given the momentum of the Warehouse Arts District. Plus, the site can come in handy for one of Williams’ current projects.
Williams is part of a group that is renovating the old SeedCo building at 826 Pennsylvania St. into a brewery, restaurant and apartments. Construction work — which involves adding two stories to the building — is underway, and Williams is using the old Black Hills Energy site to store construction material.
Down the road, the site could be used to bottle and can beer made at the brewery, which will be dubbed the Lawrence Beer Company. Williams said there could be a number of other uses for the property too. A residential use may not be in the equation, as the property in the late 1800s had a facility that burned a lot of coal to produce gas. In the late 1990s, remediation work was done on the site, and state environmental officials have said the property poses no significant risk to the public. But the state did require deed restrictions that prohibit residential construction on the site.
The property is about two acres, and the building is about 7,000 square feet, Williams said. Williams said he was well aware of the Quonset hut debate when his group bought the property.
“We do like the building,” Williams said. “It an interesting building that is in decent shape. We think it has multiple uses. We’re just not sure which ones we want to pursue yet.”
In other news and notes from around town:
• I have additional news about the Lawrence Beer Company project. Ken Baker, the longtime Lawrence chef who previously owned Pachamamas restaurant, has signed on to be a partner and lead the food operations of the Lawrence Beer Company.
For 15 years, Baker owned Pachamamas, which gained a reputation as one of the leaders in fine dining in Lawrence and the region. Pachamamas closed in 2015, and Baker said he had been enjoying his “semi-retirement” from the food business.
“I had a lot of offers to do other projects, but nothing really excited me,” Baker said. “When I met these guys, it sounded like something I could really throw my back into.”
Pachamamas was known for having fancy food, or, perhaps more accurately, new world cuisine. (To this day, when I want to look international I wear a tie with stains on it from a Pachamamas meal.) But don’t expect the same type of menu at the Lawrence Beer Company.
Baker didn’t give me a full rundown of the menu, but he gave me some hints. He said a rotisserie is being installed, and there would be “a lot of open fire cooking” and a wood-fired oven, all situated where patrons can easily watch the cooking process.
Baker said the menu will feature some entrees but will have a heavy focus on small plates and shared plates. As for the type of food, I didn’t get a lot of hints there, although Baker said some of the dishes would take advantage of the spent grains used in the brewing process.
“It is going to be a little bit different than standard brew pub fare,” Baker said. “But it should all be familiar too. We definitely want it geared to eat with beer.”
Baker joins the brewery group that includes Adam Williams, a local real estate developer, Matt Williams, a local liquor executive, and Brendon Allen, who among other things will bring some local history to the project as the grandson of Phog Allen. Adam Williams said all the partners were excited to get Baker on board.
“Everybody knows Ken Baker and Pachamamas and the quality and service he created there,” Adam Williams said. “He just brings instant street cred to the venture.”
As I was writing this, I also got a bit more information from Matt Williams, who will serve as president of the brewery, about the beer offerings. Williams said the beer production will be overseen by a a brewer who learned his craft at Half Acre Beer Company in Chicago and at Boulevard in Kansas City. The lineup is expected to focus on a few core styles with a lot of rotating varieties, and a mix of “classic styles tweaked with different hop and malt varieties.”
Construction work on the site is well underway. Matt Williams said to look for a midsummer opening. When completed, the old building, he said, will feature large windows and garage doors that open onto a large wraparound deck. The deck will lead to a beer garden that will include Adirondack chairs, picnic tables, trees, casual sitting areas and yard games.
• Yesterday’s news was about how the developers of the Warehouse Arts District hope to again use state income tax credits to partially finance their affordable housing apartment projects. Well, there is at least one other local affordable housing project that also is seeking income tax credits from the state of Kansas. The Wheatland Investment Group out of Gardner is seeking tax credits for a project it hopes to build on the east side of O’Connell Road.
The project, dubbed the Estates of Lawrence, would have 38 apartment units. About 32 of them would be enrolled in the state’s rent-controlled program that requires they be offered at below-market rates to people who have incomes between 50 percent and 60 percent of the average median income in the county.
This project, though, wouldn’t involved traditional apartment buildings. Instead, it envisions more townhouse -like units. Plans call for a mix of two- and three-bedroom, two-story town homes with a garage. The town homes would be built in a four-plex style.
The project would be built on property just north and east of East 27th Terrace and O’Connell Road.
If this project sounds familiar, it may be because we reported on it around this time last year. Wheatland last year applied for the income tax credits but didn’t receive them. The process is a pretty competitive one, so it is not unusual that a project has to apply multiple times before it is successful.
Wheatland also is the group that is building the townhome-like units on the west side of O’Connell Drive, just a bit south of 23rd Street. That project is called Bethel Estates of Lawrence. It will feature one and two-bedroom units for qualifying seniors 55 and older. Construction work is well underway on that project. I’ve put a call into Wheatland officials for an update, but I would think some of those units will be ready for occupancy this spring.
Pair of multimillion dollar affordable housing projects proposed for Warehouse Arts District; see architectural renderings for area
I always thought living in a warehouse district was cool, although that time my crate and I woke up in Cleveland wasn’t that great. Something tells me the living arrangements in East Lawrence’s popular Warehouse Arts District are quite a bit different. Regardless, there’s a new plan for many more apartments in Lawrence’s hip warehouse district.
A group led by Warehouse Arts District developer Tony Krsnich is in the early stages of securing financing for two new multistory apartment buildings that also would include commercial space for the area near Eighth and Pennsylvania streets.
City commissioners at their meeting tonight will be asked to get the process going. Krsnich is seeking a resolution of support from the commission that he can use as part of an application for affordable housing income tax credits from the state of Kansas. Krsnich — as he he did with the Poehler Lofts project and others — hopes to use to the tax credits to help finance the construction of two new apartment/retail buildings. Here’s a look at the two buildings he has on the drawing board:
— Penn Lofts would be located on a vacant lot at the southwest corner of Eighth and Pennsylvania streets. It would be a three-story building with about 70 apartments, with a mix of studio, one-bedroom, and some two- and three-bedroom units. About three-quarters of the apartments would be enrolled in the state’s rent control program, which would require that they be offered at below-market rates to people who are at or below 60 percent of the average median income in the county. The ground floor could include as much 12,000 square feet of commercial space, and Krsnich said plans currently call for seven work-live units to be located on the ground floor, meaning there could be space for someone to own a shop and live in the building too.
— Delaware Coop would be located on a vacant lot at the northwest corner of Ninth and Delaware streets. It would have 15 apartments, and 13 of them would be enrolled in the state’s rent control program. The two and a half story building would include a mix of two- and three-bedroom units, and also could include some work-live units. The ground floor is expected to have about 2,300 square feet of commercial space.
Krsnich has long said he doesn’t like the idea of building new buildings that look old, so look for these two structures to have distinctive architecture.
“They will be period appropriate,” Krsnich said. “People 100 years from now will look back and say that is really interesting architecture and engineering.”
Krsnich said the buildings will make extensive use of solar panels and they will be incorporated into the aesthetic of the building. Here’s a look at a few concept plans that have been designed by el dorado inc., the Kansas City architecture firm that Krsnich has used on other projects.
“We probably have 250 people on a waiting list trying to get a rental in the Warehouse Arts District,” Krsnich said. “People want to live and work in the area ... there are lots of small business owners and entrepreneurs who want to be part of the greater downtown area.”
The tax credits, however, will be a critical part of the project. Krsnich said he’ll hear from the Kansas Housing Resource Corp. in May whether the projects have been awarded the tax credits. If awarded, construction would begin by the end of 2017, and the projects could be open in the fall of 2018.
Krsnich said he will seek some city incentives too. The main incentive would be a request for a 95 percent, 15-year property tax rebate through the city’s Neighborhood Revitalization Program. Krsnich has received similar incentives for his other projects in the Warehouse Arts District.
Krsnich has envisioned asking for a larger incentive package that would have allowed him to build underground parking for the new projects. But he said his read of City Hall is that such a request would not be met favorably. Instead, he’s building some surface parking into the projects, and he plans to convert a gravel parking lot just east of the Poehler Lofts building into a paved parking lot that can serve as overflow parking for the new apartments and for other uses in the district.
These two projects may help the district grow its number of uses. The two apartments will be a bit different from Krsnich’s other projects because they will include commercial space on the ground floor. Krsnich said he didn’t know yet what to expect on that front. He said some of the space could be retail, but he also noted that demand for office space in the district is high. The district houses architects, engineers, attorneys and other professionals in some of the smaller warehouse space along Pennsylvania Street. Of course, the district also has a strong art gallery presence, and that could grow too.
“I’ll leave those details up to the market,” Krsnich said. “I want to build the space and begin conversations with people about it.”
Krsnich said the market has thus far produced some great results for the district. Krsnich first became involved in the area about five years ago when he decided to renovate the then-dilapidated Poehler Grocery Warehouse building into loft-style apartments through the state’s affordable housing program.
As that project became successful, Krsnich’s company began acquiring other old warehouse buildings along Pennsylvania Street and converted those into various uses, including office space, the Cider Gallery and the recently opened Bon Bon bistro.
“I think this district is a lot about the cool factor and the potential of Lawrence,” Krsnich said. “It is important to understand the idea of smart growth and talent-driven growth. That’s what is happening here. I have just tried to get out of the way of it. It has taken on a life of its own, and it has exceeded any of my expectations.”
Update: Commissioners approved the resolution of support at their meeting Tuesday. The resolution was removed from the commission’s consent agenda, and passed on a 4-1 vote. Mayor Leslie Soden voted against the resolution, but only on procedural grounds. She said she thought the process should be examined to determine whether the city’s Affordable Housing Advisory Board should first review such requests.
The resolution of support does not give the projects all the approvals they would need from City Hall. The projects would require proper land use approvals, and the City Commission would have to approve any tax rebates or other incentive requests.
— City Hall reporter Rochelle Valverde contributed to this report.
The wait is over for a commercial project to locate next to the city and KU’s Rock Chalk Park sports complex in northwest Lawrence. Developers have announced they’ve signed a deal for a $14.5 million hotel project.
A Wichita group has plans to build a 120-room Best Western Plus hotel on the property, which is just south of KU’s track and field stadium and the city’s Sports Pavilion Lawrence recreation center and fieldhouse.
More importantly, the hotel project represents the first commercial development to happen at the property. City officials have been eagerly awaiting commercial development to occur at the site, after having invested about $23 million in public money to build the parking and other infrastructure for the Rock Chalk Park sports complex. The sports complex was envisioned to be a magnet for commercial development, but the commercially-zoned land has sat empty since the sports complex opened in late 2014.
“We’re excited to be the lead-off tenant in this project,” Steve Martens, CEO of The Martens Companies and its hotel subsidiary, Hospitality Development of America, said in a release.
Martens, who is a 1975 graduate of KU, said he’s enjoyed watching the “dynamic and quality growth in west Lawrence” over the past several years. He said the new hotel will be designed to tap into two key markets in Lawrence: travelers coming for athletic events, and families with teens touring potential college locations.
The Best Western Plus brand features an indoor pool and an expanded fitness area and emphasizes an open, airy design in rooms and public areas of the hotel. The hotel will be operated by Hospitality Management LLC, which operates four other Best Western and Choice Hotel properties in Kansas and Oklahoma. It recently opened a Best Western Plus in Norman, Okla., next to to the University of Oklahoma campus.
Plans call for the hotel to be near the southwest corner of George Williams Way and Rock Chalk Drive, or basically right at the entrance of the sports complex.
The property slated for the hotel already has the necessary zoning for the project to proceed. Look for construction of the four-story building to begin this summer, and for it to open in early 2018.
It will be interesting to watch whether this hotel development serves as a catalyst for more development to come. The area near Rock Chalk Park can accommodate several hundred thousand square feet of retail development. Local businessmen Steve Schwada and Tim Fritzel are leading the group that is trying to attract tenants to the property.
The site is one of the few in town that is properly zoned to accommodate big box retailers, and the development group hasn’t been shy in making it known that it has tried to court Costco for the site. But several big box retailers — Menards and Dick’s Sporting Goods, to name two — have bypassed the property in favor of the south Iowa Street corridor.
Pat Peery, a broker with Kansas City based Lane 4 Property Group, is part of the team that has been hired to market the property to potential retailers. The hotel project is welcome news for their efforts to lure retailers to the site.
“I think it certainly will help,” Peery said. “We are glad to have a hotel. It always was in our plan to have at least one hotel. We still have a couple of major retail businesses that are considering the location. We are anticipating at some point we’ll be able to make an announcement on that front. And when that happens, that really will help things along.”
Retail developers have expressed concern that the property near Sixth Street and George Williams Way doesn’t yet have enough homes around it, but that is changing. Single-family homes are being built in the Oregon Trail addition just east of the property, and nearly 600 living units worth of apartments are being built just east of Rock Chalk Park as part of new golf course/apartment development.
“The more rooftops you have, the better the site shows,” Peery said. “And it is showing better all the time. We have had a large number of inquiries from out-of-town developers.”
Peery said the property’s selling points for retailers are that it has good access to Sixth Street and to the now-completed South Lawrence Trafficway.
“The growth on the west side of town is very positive,” Peery said. “It is where the future is heading, and people can see that.”
Peery said the site’s location also allows it to market to retailers who want to attract the eastern Topeka market. He said that was a selling point for the hotel project. The hotel company believes it is close enough to the Kansas Statehouse to compete well with hotels that are situated on the far west side of Topeka.
Thus far, the traffic generated by Rock Chalk Park hasn’t been a big selling point for traditional retailers. the amount of traffic coming and going from the complex isn’t likely to be enough to be a deciding factor on whether a big box store locates at the site. But Peery said the sports complex traffic will be a major selling point for restaurants. He predicts several restaurants will want to locate on the property, but he said the development needs that first big retailer to come in and build out infrastructure before the group can aggressively market to restaurants.
Getting that first big retailer is always the hardest part of any development. But if the first retailer — especially if it is a big one like a Costco — does come, the area is poised to be a major shopping area.
One concept plan that often is pitched to potential tenants shows a 140,000 square foot big box store on one end, a 100,000 square foot store on the other, with space for 13 other smaller retailers in between. In total, the concept plan shows about 640,000 square feet of commercial space around about 3,000 parking spaces.
The concept plan is almost certain to change, as the hotel project will require some alterations, but it does give you an idea of the scope of development the group is hoping for. As for the timing of when the next major announcement may come at the site, Peery directed me to Schwada. I haven’t yet heard back from him, but I’ll let you know if I do.
The Russians are at it again. They apparently are hacking into Mother Nature in an effort to give us Siberia. (There is not unanimity on that point. Some leaders believe the pending ice storm may be the result of some guy in New Jersey leaving his freezer door open.) I can’t sort that out, but I do have some news and notes for you to ponder while you try to stay warm and safe this weekend.
• Perhaps the memories of Don’s Steakhouse can keep you warm. Soon, that is all you will have left of the once popular restaurant along Lawrence’s eastern edge. Demolition crews on Friday were tearing the building down.
For those of you have forgotten, Don’s Steakhouse was just west of 23rd and O’Connell. Crews earlier this week tore down the old Diamond Everley Roofing building that was just east of the Don’s Steakhouse building. A development group led by an executive with Diamond Everley is redeveloping the old roofing business site and the Don’s Steakhouse site into an 89-room Country Inn & Suites Hotel.
Crews were tearing into the backside of the restaurant building early this morning, and there probably won’t be much left of it by the end of the day. Don’s Steakhouse was open from 1962 to 2008, with founder Don Scott running it for several decades and then Lawrence businessman Gary Bartz taking over in about 1990.
In addition to the 89-room hotel, development plans for the property also call for a restaurant to build on the site. The last I heard, however, a deal had not yet been struck for a restaurant to locate on the site, and the development group was focusing on getting the hotel project completed.
• Don’s was the second high-profile demolition to take place in Lawrence this week. The former BarbWire's Steakhouse and Saloon building on south Iowa Street also was reduced to a pile of rubble. (It is like an angry herd of bovines got their hooves on some demolition equipment this week.)
As we reported in October, a group led by the local franchise owner of the new Slim Chickens restaurant chain purchased the property. He told me then that he likely was going to tear down the building to make way for a new Slim Chickens restaurant.
How soon that will happen, though, isn’t entirely certain. The chain is opening its first Lawrence restaurant in late January in the former KFC building near Sixth and Wakarusa. Back in October, owner Mark Killeen told me he wanted to get that restaurant open, and he also is working to open a Slim Chickens in Wichita before he turns his attention to the south Iowa Street location.
But it looks like there is every reason to expect a Slim Chickens to be on the site sooner rather than later. In addition to tearing the building down, Killeen has filed a site plan with the city for a new restaurant building to be constructed on the site.
In case you are having a hard time picturing the location, it is at 2412 Iowa St. After BarbWire's closed several years ago, it was most recently a dance club called Wilde’s Chateau 24.
• Now, this is just getting scary. In the time that I started writing this column this morning, I’ve since learned that Montana Mike’s Steakhouse has closed its Lawrence location. If you are scoring at home, that is three either current or former steakhouse locations that have gone by the wayside. If a bovine gets hold of a snow plow this weekend, chicken places will be the only thing left in town.
An employee at Montana Mike’s, 1015 Iowa St., confirmed that the restaurant has shut down. But he also said the company behind Montana Mike’s plans to open a new restaurant at the location this spring. Look for remodeling work to begin soon. The employee said the new restaurant would be a different concept than Montana Mike’s but he said he wasn’t authorized to speak about that. I’ll reach out to the corporate headquarters at a later time to see if I can learn more.
As for Montana Mike’s, it may not be coincidence that it has closed just a few months after Texas Roadhouse opened its chain steakhouse on south Iowa Street. But the closing does end a long run for the budget steakhouse. The employee I talked with didn’t have an exact date of when the restaurant opened in Lawrence, but it has been in town for more than 15 years, he said.
When this hick from the sticks arrived in Lawrence in 1992, I became excited when I saw the sign for the downtown store The Buckle. I went in to buy a dinner-size plate one, with big steer horns, but quickly learned the place really wasn’t selling belt buckles. Soon, it won’t be selling anything in Lawrence. The longtime retailer is leaving town.
Claire Little, manager of The Buckle at 805 Massachusetts St., confirmed that the chain has decided to close its downtown store and won’t seek another spot in Lawrence to replace it. An exact closing date hasn’t been set, but Little said it likely would be in April or a bit before.
Little said she wasn’t privy to all the details behind the decision by the Nebraska-based chain to close the Lawrence store. But she indicated the company had decided it could serve the Lawrence market with its Kansas City and Topeka stores. None of those stores are closing, and the approximately 10 to 15 employees of the Lawrence store will be offered a chance to transfer to those locations, if they so choose, Little said.
Little wasn’t quite sure how long The Buckle had been in downtown Lawrence, but it is a 25-year plus member of Lawrence’s retail scene. It also occupies a larger than average space in downtown. At the moment, I don’t believe there is anything lined up to take the place of The Buckle. The Buckle becomes at least the third fairly large space seeking a tenant: the former Buffalo Wild Wings spot is vacant, and the former M&M Office Supply building also is vacant, although construction work has started there. (You may remember in April we reported on a plan to put a new facade on the building, with the apparent goal of making a multi-tenant office or retail building. I have heard some rumors about office users. I’ll report back when I hear more.)
The Buckle’s pending closure comes on the heels of at least two other announcements: The closing of the TCBY store and the pending closure of the Ten Thousand Villages retail store in downtown. The closing also comes just after I reported that Lawrence had the best sales tax growth of any major retail market in the state in 2016. The two are not contradictory, but rather just a reminder that success is rarely distributed equally.
It will be interesting to watch for other closing signs. We are in that time period where many downtown leases are set to expire. That’s often when a business decides to close shop.
In other news and notes from around town:
• I’m not sure anyone is really going to toast Gov. Sam Brownback’s proposal to close the state’s budget gap. I’m quite sure one group that won’t is the liquor store industry.
As J-W statehouse reporter Peter Hancock reported yesterday, the governor’s plan calls for the state to raise its “liquor enforcement tax” to 16 percent. In case you are unfamiliar, the liquor enforcement tax is the special type of sales tax that you pay on purchases made at a liquor store. I have written about this topic several times before, most recently in March.
The current liquor enforcement tax is 8 percent. That’s the only tax you pay when you buy a product at a liquor store. The city’s standard 9.05 percent sales tax is not charged at a liquor store. That has created the odd situation where Lawrence residents pay more in taxes for groceries than they do for liquor.
Back in March, I sought to highlight how common that situation was across the state. Back in March — and I don’t suspect the numbers have changed much since then — I found that more than 300 jurisdictions in Kansas had sales tax rates greater than 8 percent. In more densely populated areas, it was the norm.
Kansas had 23 cities with a population of 20,000 or more. Of those, 21 cities have sales tax rates greater than 8 percent. The majority of Kansas’ population pays more in taxes for bananas than bourbon.
If Brownback’s plan is approved, that will no longer be the case. The price of drinking in Kansas will go up. A $25 bottle of liquor would have an extra $2 in tax attached to it. Bars and restaurants also pay the liquor enforcement tax on the bottles of booze they buy, so expect them to try to pass along the extra cost in the form of higher cocktail prices.
The liquor enforcement tax would rise from 8 percent to 16 percent under the plan. That’s a big increase, but in some ways it brings the liquor enforcement tax back in line with its original standing. For whatever reason, the liquor enforcement tax hasn’t been increased since 1983. Back in 1983, the 8 percent liquor tax was nearly double the normal sales tax that consumers were paying for groceries and other items. Brownback’s proposal will roughly restore that type of ratio.
It won’t be popular in all circles. The liquor industry — which in many ways is headquartered in Lawrence with two major distributors, one of the top lobbyists for the industry, and a very large bar community based here — will note liquor already is taxed a lot. The state charges a gallonage tax at the wholesale level. Plus, there is an entirely separate 10 percent tax called a liquor drink tax that consumers pay when they buy a cocktail at a bar or restaurant. No doubt, the state does a fair amount of milking of the liquor industry.
But still, the optics aren’t good on this. When I go to the counter with a bottle of bourbon and a batch of bananas, the clerk is going to add more tax onto the bananas than the bourbon. It is not for me to say whether that is the right message to send, but it should be interesting to watch how politicians navigate it all.
Or maybe we should watch for this: bourbon-infused bananas. It might be the answer to the state’s budget problems. We could tax that product twice.
The sales tax numbers for 2016 are in, and they show Lawrence was perhaps the hottest retail market in the state — and that is before sales of the Donald Trump inauguration T-shirts and the replica Meryl Streep Golden Globe statuettes.
As we have been telling you all year, Lawrence’s monthly sales tax collections have been growing at a faster rate than any of the other major retail markets in Kansas. Well, cities across the state have received from the state their final sales tax check of 2016, and Lawrence has retained that distinction.
Lawrence finished 2016 with sales tax revenues growing by 5.5 percent, compared with 2015 totals. When you combine sales and use taxes (use taxes are the tax you pay when you buy something online and the retailer doesn’t charge you a sales tax) the city’s total collections grew by 6.4 percent. That’s not a record year, but it is close to it. Here’s a look at the growth rates from recent years and the total amount of sales and use taxes received by the city:
— 2016: up 6.4 percent to $27.3 million
— 2015: up 4.4 percent to $25.7 million
— 2014: up 5.5 percent to $24.6 million
— 2013: up 1.9 percent to $23.3 million
— 2012: up 5 percent to $22.9 million
The 2016 growth rate ended up being the best since 1998, when sales tax collections grew by a whopping 8.5 percent. (You all remember the glorious year of 1998, when we were buying Beanie Babies and our only Russian worry was whether Boris Yeltsin inadvertently would become trapped in a vodka bottle.) Those were good times for Lawrence’s retail scene. But it may surprise people that this last five-year period has been every bit as good. Even though it may not have felt as fun, Lawrence’s sales tax collections from 2011 to 2016 have grown by 23 percent. From 1997 to 2002, they grew by 21 percent.
If local governments have funding problems, they should not blame consumers or sales tax collections.
In 2016, Lawrence definitely didn’t have anything to complain about on the sales tax front. Here’s a look at how Lawrence performed compared with the other major retail communities in the state:
— Lawrence: up 5.5 percent
— Olathe: up 3.6 percent
— Topeka: up 3.3 percent
— Overland Park: up 2.7 percent
— Manhattan: up 1.8 percent
— Johnson County: up 1.8 percent
— Kansas City: up 1.7 percent
— Sedgwick County: up 1.1 percent
— Lenexa: down 2.5 percent
For what it is worth, it also appears sales tax collections strengthened as the year went along. For example, when I reported on sales tax collections in April, Lawrence had posted just a 2.9 percent increase, and Topeka, Johnson County and Overland Park all were in negative territory. All those communities saw significant growth in sales tax collections since then.
As to why Lawrence had such good sales tax numbers, 2016 was the year Menards opened its large home improvement store in south Lawrence. City reports note that sales tax collections on building materials sold in Lawrence were up 24 percent compared with 2015. Sales tax collections on vehicles and car parts sold in Lawrence were up 9 percent. And sales tax collections on grocery items were up 5 percent.
The building materials number is the most interesting. It is not definitive proof that the Menards store is causing people to keep more of their dollars in Lawrence, but that is what it suggests. If the city wants to study something else, a good topic would be how much money do Lawrence residents spend outside the city, and have developments such as Menards and Dick’s Sporting Goods helped lessen that number? You would think city commissioners would want to have that information before they decide whether to reject new shopping center developments, like the proposal south of the SLT and Iowa Street interchange, which is now the subject of a lawsuit.
• Now that we have year-end numbers, it also is interesting to look at just how much business the largest retail markets in the state did in 2016.
— Johnson County (Home to Overland Park, et al): $11.44 billion
— Sedgwick County (Home to Wichita): $9.01 billion
— Shawnee County (Home to Topeka): $2.94 billion
— Wyandotte County (Home to Kansas City): $2.59 billion
— Douglas County: $1.71 billion
— Manhattan (Manhattan is in two counties so I used the city totals instead of trying to combine the two county totals): $1.12 billion
— Saline County (Home to Salina): $1.11 billion
— Reno County (Home to Hutchinson): $947.73 million
— Leavenworth County: $685.85 million
— Finney County (Home to Garden City): $673.75 million
— Ellis County (Home to Hays): $622.11 million
— Ford County (Home to Dodge City): $575.84 million
— Lyon County (Home to Emporia): $465.41 million
— Geary County (Home to Junction City): $427.35 million
• And just because the warm weather has done wonders for my arthritic fingers and toes, I decided to do one more math exercise to pass along. Here’s a look at per capita spending levels in the large counties. I find the numbers interesting because they provide a little more context. A county like Johnson County should have a lot more retail sales than a county like Douglas County, if for no other reason than it has a lot more people. The per capita numbers give you an idea of how well a market is doing in terms of pulling in outside residents to shop, and they also may give you an idea of whether residents of the county have more disposable income to spend.
— Ellis County: $21,430 per capita
— Saline County: $19,931 per capita
— Johnson County: $19,718 per capita
— Finney County: $18,320 per capita
— Sedgwick County: $17,612 per capita
— Ford County: $16,660 per capita
— Shawnee County: $16,449 per capita
— Wyandotte County: $15,853 per capita
— Manhattan: $14,884 per capita
— Reno County: $14,873 per capita
— Douglas County: $14,485 per capita
— Lyon County: $13,959 per capita
— Geary County: $11,540 per capita
— Leavenworth County: $8,647 per capita
Lawrence obviously finishes in the lower half of that list. Some people would argue Lawrence is destined to always be low on that list because we are too close to major shopping districts in Johnson County and Topeka. Others argue that Lawrence could move up the list if it allowed more shopping developments to occur in Lawrence, thus giving people less incentive to drive to Topeka or Johnson County.
That’s an argument that likely is to continue. One thing that is a little more concrete: State numbers show that out of the 93 Kansas counties that have a local sales tax, 56 of them saw their sales tax totals decline in 2016. Douglas County ought to be pleased that it is not yet among them.
West Lawrence pizza location closes, and an update on other comings and goings in the world of Lawrence pizza
Perhaps you remember that time period when seemingly all of west Lawrence turned into New York City. If not, I’m talking about that period in 2012 and 2013 when nearly every restaurant that opened was a New York-style pizzeria serving “pie slices” big enough to cover a Donald Trump comb-over.
There was Morningstar’s New York Pizza at Sixth and Wakarusa, Tad’s Pizzeria at Bob Billings and Kasold, and Johnny Brusco’s also at Sixth and Wakarusa. You may recall that Johnny Brusco’s closed before I could even get the marinara sauce off my tie. The other two duked it out, though, for a good long time. But no more. Tad’s Pizzeria at 1410 Kasold closed in recent days.
Owner Tad Gellender told me the business’ lease was up at the end of 2016, and he decided he wanted to spend more time with his four children than at the restaurant. Gellender said business was fine, and actually he sold the name, the recipes and the equipment to an operation called KC’s Neighborhood Bar and Grill in Merriam.
“I tried to sell it locally, but nobody really looked at it,” Gellender said.
So, folks will be able to go to Kansas City to get that particular style of New York Pizza. But you really don’t need to leave town at all. There are still plenty of places near Sixth and Wakarusa that serve pizza crust like Facebook serves facts — thin. The southwest corner of Sixth and Wakarusa has Morningstar’s and Johnny’s Tavern, both of which serve New York-style pizza, and the northwest corner has the newly opened Spin pizza, which serves Neapolitan style pizza, which also is a thin-crust variety.
Some of you, though, may be more worried about Gellender’s other business venture: Tad’s Shaved Ice, which has operated for decades out of a small food trailer along Iowa Street. Tad said not to worry. The decision to get out of the pizza business won’t affect the shaved-ice business, which operates seasonally near the NAPA Auto Parts store south of Ninth and Iowa streets.
“That business is still good to go,” he said.
Gellender said he’s had that business for 22 years, opening it right after he graduated from Pittsburg State and moved to Lawrence.
In other news and notes from around town:
• While we are near the Sixth and Wakarusa intersection, I have news of Lawrence’s other favorite food: fried chicken. We’ve reported that the Arkansas-based chain Slim Chickens is locating in the former KFC location at Sixth and Wakarusa. Well, evidently Slim is quick at construction. According to the Facebook page for Slim Chickens, the Lawrence restaurant plans to open before the end of the month. As we have reported, Slim Chickens focuses on chicken fingers and chicken sandwiches.
• Back to pizza. Domino’s Pizza is probably not what you would consider New York pizza, but it is cheap and of better quality than Mariah Carey’s last New York performance. There is good news for fans of Domino’s near Ninth and Iowa streets.
The company’s store near the northeast corner of the intersection has been under renovation since August. Look for it to open soon. General manager Neal Coomes said he couldn’t provide an exact timeline, but he indicated it would be just a few weeks.
The renovation has taken about twice as long as expected, but Coomes said the location will have some dramatic improvements. Prior to the renovation, the location was strictly take-out or delivery. There will be some dine-in options at the new location. Coomes said there will be counter seating, plus two or three booths and tables for diners.
The renovation includes a complete makeover of both the interior and exterior space, and the design will be similar to the newly renovated Domino’s on 23rd Street, which is owned by the same franchisee. (Win a trivia contest with this knowledge: The owner of the Lawrence Domino’s is the brother of former Kansas City Chiefs quarterback Trent Green.) Coomes said the Ninth and Iowa location will include a much more open kitchen concept that allows customers to see their pizzas being made.
“We call it the dough show,” Coomes said. “You can watch us slap out the dough and make the pizza.”
One other thing to note about the renovation. Coomes said the parking lot will become one way, with motorists able to enter only off of Iowa Street and able to exit only onto Ninth Street.
• This last item is speculation, but if you can’t speculate about pizza, what can you speculate about? (I once speculated that anchovies, habaneros and pickle chips would be a good pizza combo, but a stomach pump proved me wrong.)
For whatever it is worth, keep an ear open for a chain called Marco’s Pizza moving to Lawrence. The company sent me a press release saying it has plans to open 35 new stores throughout the greater Kansas City area in the next five years. The press release specifically mentioned the communities of Lawrence, Ottawa, Blue Springs and Shawnee as targets for expansion.
The company touts itself as the fastest growing pizza chain in the country, opening a new store about every three days. It also touts itself as the only American pizza chain founded by a native Italian. The company currently has five stores in the Kansas City market, and serves pizza, subs, wings, salads and a few desserts.
I have heard no news of an imminent deal in Lawrence, but I’ll let you know if that changes.
In today’s technological age, it probably is not wise to brag about the quality of your Rolodex. It makes people think you’ve dropped your iPhone in the toilet. But whether you have them stored on your smartphone or on a crumpled up cocktail napkin, it still is important to know who to contact and how to do it. In the ultra competitive industry of economic development, it is vital.
Lawrence officially has a new leader of economic development that comes loaded with a ton of contacts. I sat down for a good conversation with Steve Kelly on just his third day on the job as the new vice president of economic development for the Lawrence chamber of commerce.
To be clear, Kelly did not brag about his Rolodex. Kelly may end up being one of Lawrence’s most important salesmen. His job is to interact with and help close the deals with new and expanding companies that will produce new jobs in Lawrence and Douglas County. But I got the impression that Kelly is the type of salesman who doesn’t oversell anything. Instead, he’s the type who will always remember your name, where you met, and figure out a way to make a connection whenever your paths cross.
While he didn’t tout his connections, I know there are many in the community who are excited about them. Kelly came to The Chamber after having served as the deputy secretary of the Kansas Department of Commerce and director of business and community development for the agency. When asked, he can rattle off a list of big deals he has been a part of: the Mars candy plant in Topeka; the Kansas Speedway and surrounding retail development; General Motors expansions in Kansas City; and many aviation deals in Wichita.
The complete list would be much longer. He had been with the Department of Commerce for 26 years. He was the guy who always survived the change in administrations. Political appointees have short shelf lives, but deal makers last longer than the fat-free mayonnaise in my refrigerator.
Lawrence has had experienced economic development leaders in the past decade, but often their experience was in different regions of the country. Not only does Kelly know the players in Kansas, he’s lived in Lawrence for nearly 30 years.
Economic development and the jobs its produces are always important, so it would be hyperbole for me to say the community is at some sort of crossroads. But this is an important hire for The Chamber. There has been a lot of turnover in both this position and the Chamber CEO and president position. It is not coincidental that the turnover has coincided with some fairly stagnant job growth numbers over the last decade.
As I’ve said before, I like to share some of the conversations I have with community leaders, so here is a look at three takeaways from my meeting with Kelly:
It is a common refrain that Lawrence has a poor reputation in broader economic development circles. What you hear is that projects are more difficult to do here than they are elsewhere. I’ve heard that refrain through both good times and bad, so I am never sure what to make of it. Business executives, I suspect, always want to move faster.
But there is no doubt that such a reputation could be damaging to Lawrence's and Douglas County’s efforts to grow jobs. Kelly was diplomatic about the topic but certainly didn’t dismiss the complaints.
“I think there probably is some work to do in that area,” Kelly said of Lawrence's reputation in economic development circles. Some of that commentary is out there. It is not a real large group of folks who work on these projects. There are a lot of conversations. Both good words and bad words get around pretty quickly.
“I think there has been a perception that Lawrence hasn’t been as easy or as amenable or as welcoming as some other communities have.”
Kelly, though, also said that Lawrence is a well-planned community. It hasn’t traditionally done things “willy-nilly.”
“One of the reasons Lawrence is cool is maybe because the community hasn’t done some of these things that people sought,” Kelly said. “But I would say there is a perception out there that there are easier places to do things than Lawrence.”
I’m confident that there is a subset of the population who has no problem with that perception. But that reputation comes with a question: Will it hold Lawrence back from being a jobs leader?
I didn’t ask Kelly that one. It was only his third day on the job. But he knows what he has signed up for.
“The world is pretty competitive right now,” Kelly said.
VenturePark, the city-owned industrial park on the eastern edge of the city, opened for business in October 2014. The park, though, is still seeking its first tenant.
Menards, the large home-improvement retailer, has announced plans to construct at the park a center that manufactures and distributes certain building materials. But the company has put those plans on indefinite hold. I don’t have much of an update for you on that, other than chamber officials previously have said they were hopeful the company would re-evaluate after the presidential election. I do know that Kelly has worked with the Menards folks in his state capacity, and I’m sure they are among the first calls he is making in his new job.
Kelly said, despite the park being empty, there is no reason to second guess the city’s decision to proceed with Venture Park. It is right next door to the East Hills Business Park, it has easy access to the recently completed South Lawrence Trafficway, it has a rail spur, and it was on old industrial property that was going to need to be cleaned up regardless. (You may remember, it was the old Farmland fertilizer plant.)
“I think the decision they made at the time was a very good decision,” Kelly said.
In terms of what the public’s expectations should be for the park in 2017, that’s a tough one to answer.
“It is not something you can put a magic timeline on,” Kelly said. “If it hasn’t happened by a certain time, you can’t say it is a failure. I don’t think it works that way. I have seen enough examples to know that getting over that first hurdle is typically the hardest one. Once you get that first tenant, it usually takes care of itself.”
Regardless, I still think it is an important year for VenturePark. At some point, an empty business park becomes demoralizing. I think a key question will be how aggressive the city is willing to become with incentives to get over that first hurdle. It is worth remembering that through the Farmland bankruptcy process, the city got the land for free, plus received a multimillion-dollar trust fund to clean up the property. Granted, the city has spent millions on the roads and infrastructure at the site, but the deal the city got on the property may allow it to be fairly aggressive.
Kelly did not weigh in much on the new policy the city has adopted as it relates to economic development incentives. He said he hasn’t studied it enough to offer specific comments. But he did talk about how incentives are an “important” piece of the puzzle in attracting a company, with other big pieces including workforce availability, workforce training and the “general climate or vibe” of the community.
“When you are changing a policy like that, you want to understand what you are trying to accomplish, and then be very diligent in trying to determine what the unintended consequences may be.”
The policy changes at City Hall, though, are just one item to keep an eye on with the City Commission. City Manager Tom Markus has talked about the need for the City Commission to do more big-picture, strategic planning, and 2017 seems to be the year that is going to happen. Such a process will encompass many topics, but certainly jobs and economic development will be a part of the discussion.
It will be interesting to see what type of vision the community comes up with for economic development. Throw into the mix that at the same time the University of Kansas will be getting a new chancellor. Some of KU’s strategic planning has opened the door for the West Campus to become more business and entrepreneurial oriented. If the next chancellor has a passion for that, an exciting plan could be crafted. Imagine if Lawrence’s next business park was on West Campus, where companies that want to have close access to talent among the university’s faculty and students could locate.
Kelly didn’t get into any of those specifics, but I know forging relationships with the university the city and the county is a priority for him.
“We can sit here and talk about and know about a lot of our assets, but what’s important is to have a real plan on how to take advantage of those attributes that set us apart or give us an advantage,” he said.
Update on doughnut, whiskey and fried chicken place; pingpong, cheap beer among changes at music venue
Doughnuts and whiskey might become the new Breakfast of Champions. Exactly what you are a champion of might be an interesting debate. But, yes, proving that anything is possible in downtown Lawrence, we indeed are getting a doughnut shop that also will serve you fine whiskey. Proving that we are intent on giving doctors everywhere a certain salute, it also will serve fried chicken.
I alerted you last week that I had seen a City Hall application for a future downtown business that wanted to sell doughnuts, fried chicken and whiskey, but the permit application didn’t provide much information. (To be clear, it a was permit for a sign. You don’t have to pay for a city permit to fry a chicken. If you did, the south Iowa corridor alone would solve all city budget problems for a generation.)
Well, now I know more. Longtime downtown restaurant owner Nick Wysong is leading a group that will open Wake the Dead: Chicken, Whiskey, Donuts at 918 Massachusetts St., which is the former location of Burger Fi.
Wysong is the co-founder and owner of the popular downtown restaurant Ingredient. Perhaps more importantly for this venture, he’s also the former owner of Harolds Fried Chicken & Donuts. That was the short-lived restaurant that operated out of the Miller Mart gas station on West Sixth Street.
Wysong said the concept of fried chicken served with a doughnut developed a bit of a cult following during the year that Harolds was open. Wysong said he always wanted to continue with the idea, but was looking to tweak both the concept and location a bit.
Wysong has partnered with Lawrence businessman Ryan Robinson, who brings a lot of marketing experience to the table as a promoter of Color Run races across the country. Josh Kurzdan, who was part of the Lawrence Burger Fi restaurant, also is part of the group, Wysong said.
What won’t change with the business is the chicken recipe. It will continue to be “honest, Southern-style fried chicken.” It will be fried in the old-fashioned manner and will come with a choice of about a dozen sauces. Traditional sides such as potatoes and gravy or macaroni and cheese will be on the menu.
At Harolds, the doughnuts were a bit of a side dish. But that won’t be the case at Wake the Dead. Wysong said the restaurant will be a fully functioning doughnut shop. People will be able to come in of a morning and get a few dozen doughnuts to take to the office. If the thought of going to the office requires a shot of bourbon, Wake the Dead also will serve you that. The shop will have a large selection of “top shelf whiskeys,” Wysong said. It also, obviously, will have evening hours. It isn’t betting on whiskey for breakfast becoming a hugely popular trend. (It is trend-disadvantaged because people who partake in it don’t remember it well enough to tweet about it.)
As for the doughnuts, Wysong said he expects to have a stable of about 60 recipes, although he plans to start out by having about a dozen varieties available daily.
“We’re going to do this right and do it well,” Wysong said. “But the doughnut element is going to be huge. We’re super stoked about that.”
But perhaps what will blow your mind is that the fried chicken and the doughnuts truly will come together. (See, there is hope for a divided America.) Harolds served a sandwich called the Grilled Glazer. It was fried chicken covered in cheese sauce, a secret sauce, sandwiched between two maple-glazed doughnuts. Are you understanding this? The doughnuts served as the bread for the sandwich. I always assumed Harolds closed after a year in business because it was miffed that it had not yet won a Nobel Prize for this innovation.
Well, the Grilled Glazer will be on the menu of Wake the Dead. Wysong also said the menu will include a line of other sandwiches, some of which also will use doughnuts in place of bread. He didn’t give me details on what those will look like. (Or perhaps he did, but I was too busy renting a semi to carry my next order of cholesterol medicine.)
Remodeling work is already underway at the site. Wysong hopes to have the restaurant open in late January.
• Wake the Dead, however, isn’t the only venture Wysong is working on. Wysong also is part of a group that has purchased the Jackpot Music Hall and Saloon at 943 Massachusetts St.
You may have noticed that Jackpot was closed for a couple of weeks in November. That’s when Wysong’s group purchased the business. The group did a bit of remodeling on the interior and installed new exterior signage.
Wysong said Jackpot still will function as a bar and music venue. Wysong called himself a “good music fanatic,” and he said the venue will host a variety of genres including rock, bluegrass, funk, hip hop, country and others.
The business is next door to Wysong’s Ingredient restaurant and his Five Bar and Tables establishment that has been hosting live music, particularly jazz, for awhile now. Five Bar and Tables also has been host to regular pingpong gatherings. Those pingpong tables are moving to Jackpot, and he said the bar soon will announce a weekly special involving pingpong and cheap beer.
“I’ve always had a big crush on Jackpot,” Wysong said of the decision to buy the establishment. “We feel like we have had a lot of good luck promoting jazz at (Five Bar and Tables.) Now we have a bigger stage and venue to promote music.”
Ed Forman had been warned about downtown Lawrence.
It was about 2005 when Forman began looking for a spot in an idyllic downtown where he and his wife could work together in a sweet shop, share some smiles and maybe create a few too. But those in the regional business community had cautioned Forman about downtown Lawrence. They told him two factors consistently drove businesses out of business in downtown: high rents and a City Hall that was terrible to work with.
By 2012, Forman and his wife took the leap. They opened the TCBY frozen yogurt shop at Ninth and Massachusetts. In the last few days, they closed it. The couple no longer could make the TCBY franchise work. Forman said he had a plan to open a business called Free State Frozen Coffee and Desserts, but a noncompete clause with TCBY won’t allow it. For the moment, the building sits empty while Forman works to find a new idea or someone to take over his lease.
Another downtown business out of business. Remember the warning? Come to find out, it wasn’t accurate. Yes, the result was the same — a closed business — but the reasons behind the closure weren’t high rents and a difficult city government.
Forman, who has a business in Branson, Mo., and has owned businesses in more than a half-dozen other cities, said Lawrence City Hall was among the best he has worked with. He also had no complaints with the rent or his landlord, the late George Paley and his family.
When Forman spoke to me, he was insistent that people understand those old, familiar reasons weren’t behind this closure. Instead, he thinks it is important for Lawrence residents to hear something that he knows several merchants in downtown think but aren’t always comfortable saying.
“The people of Lawrence,” Forman said when asked about what needs to change with downtown. “The west-siders need to reinvest in downtown Lawrence.”
Forman said he believes downtown is becoming a bit like The Strip in Las Vegas. He said the last place residents of Las Vegas want to go on a regular basis is The Strip. They go when they have visitors from out of town or when there is a special event, but many other times they avoid it.
Forman said it always was surprising how many of his shop’s customers were from out of town — many Johnson County residents coming over for a weekend outing. That’s good. Lawrence will take all the Johnson County money it can get. But unlike Las Vegas, Lawrence doesn’t yet have a tourism industry large enough to entirely support the downtown that we want to have.
A bit of perspective is probably important here. There has been a lot of new building in downtown in the last several years. Vacancy rates are not particularly high in the district. Downtown is not in crisis. And there probably are a multitude of reasons why the TCBY shop didn’t work, including the fact that a Kansas winter doesn’t always put a fellow in the mood for frozen yogurt.
But I’ve certainly heard the concerns whispered before that Lawrence consumers don’t support their downtown businesses like they used to. Worse yet, Forman thinks Lawrence residents have become a bit blasé about it.
“I think too many Lawrence people are content with the idea that businesses come and go in downtown, but that is not how you build a strong downtown,” Forman said.
Certainly there are Lawrence residents concerned about the long-term health of downtown. A certain subset of that group likely have a predictable response to this issue: Don’t allow frozen yogurt shops to locate anywhere but downtown. One possible strategy has always been to protect downtown at the expense of all other areas of town. Going that path, however, puts the community at odds with perhaps the most prevalent trend in America: the need for everything to be convenient. For that reason, the strategy might not work. If a frozen yogurt place wasn’t allowed to open at Sixth and Wakarusa, for instance, I’m not sure whether TCBY would have sold more frozen yogurt or whether Lawrence would have just eaten less frozen yogurt.
Another option is to embrace the idea of downtown Lawrence retail being supported primarily by visitors. If that is the case, though, Lawrence’s tourism industry is likely going to have to grow substantially.
The strategy that it seemed like the city had settled on was to encourage more people to live downtown, which in turn would be good for downtown retailers. The most convenient place for people who live downtown to shop would be downtown.
But as the apartment development along New Hampshire Street has illustrated, such a strategy relies on the city providing financial incentives, especially to address the parking issues that are caused by more people living downtown. It is less clear whether the current City Commission believes in that strategy. It rejected incentives for Bob Schumm’s apartment project on Vermont Street, and it seems the new incentives policy passed by the commission will make the use of incentives more difficult in downtown.
What to do? Hard to say. Downtown, like many beautiful things, is complex.
But Forman — who said he still loves downtown and may open a future business in the district — contends that Lawrence residents could make the situation better by doing something very simple: Find more reasons to go downtown and spend.
“We do wish the people of Lawrence would invest as much in downtown as the merchants do,” he said.
Chain retailer along south Iowa Street announces pending closure; downtown restaurant shuts down, burger shop to take its place
Lawrence is in that unique time period known as KU Winter Break, where the entire university is seemingly run by the French labor department. (Wait, I can ignore work-related emails? Has that pesky prohibition about fondue at my desk also been lifted?) Given this abundance of leisure, it seems now would be the time that a store known for selling oversized chairs and massive pillows would be thriving. But no, I have news that Lawrence’s Pier 1 Imports store is closing.
The closing signs have gone up at the Pier 1 location at 3211 Iowa St. The closing will mark the end of a fairly longtime retailer in Lawrence. I know the chain dates to at least the mid-1990s, when it operated a store in downtown Lawrence. (I know because that is when I first came to town, and like all college students, I had a fascination with wicker.)
The closing, though, is not entirely unexpected. The Fort Worth-based chain had announced in late 2015 that it planned to close over the next three years about 10 percent of its stores because of declining sales. Many of the stores would close as their leases expired, the company stated.
No word on what may replace the store. The Lawrence location is in a high-visibility location along Iowa Street, in front of the SuperTarget. So, while our ability to buy papasans, swingasans and even spinasans on a whim is waning, it seems like the building may be a likely candidate to bring a new retailer to the south Iowa Street scene. I’ll keep my ears open on that front.
As for the closing, a store employee told me there hasn’t been an exact date set to end operations in Lawrence, but the store tentatively is scheduled to be open into February. The company will continue to operate its nearby stores in Topeka, Shawnee and Olathe.
In other news and notes from around town:
• I’ve got news of another closing too. Jerusalem Cafe has closed its Lawrence location at 1008 Massachusetts St.
The Middle Eastern restaurant lasted less than a year in Lawrence. That is despite the fact that Jerusalem Cafe is a popular eatery in Kansas City. My understanding is that while the Lawrence and Kansas City restaurants were affiliated in some way, they weren’t run by the same ownership group. So, likely no need to worry about the KC location. When you are driving to Kansas City to buy your papasan you can pick up a gyro too. (You obviously can still buy gyros in Lawrence too as evidenced by the tzatziki sauce in the Grizzly Adams-like beards that many KU faculty members have grown during the winter break period.)
It seems that we also will get the chance to buy something called a smoke burger. A sign in the window of the former Jerusalem Cafe location says KC Smoke Burgers will be going into the vacant space.
If that sounds familiar, it is because KC Smoke Burgers was the tenant at the location before Jerusalem Cafe opened in the Mass. Street spot. Its lifespan in Lawrence was fairly short, but I guess the owners believe in the idea of the second time is a charm. Or perhaps we are just on a "Groundhog Day"-loop to relive 2015 and 2016 again.
Regardless, as we previously reported, KC Smoke Burgers is a popular restaurant near the KU Medical Center in Kansas City. It serves about 20 hamburger varieties, including traditional variations plus more exotic dishes such as lamb burgers, gyro smoke burgers and one dish that includes jalapeños, habaneros and hot sauce.
No word on when the burger restaurant will open, but keep your eyes open for activity at the site.
• There is no reason to press the panic alarm about the future of one of Lawrence’s Dairy Queens. The DQ on south Massachusetts Street is closed, but only temporarily, the owner tells me.
The store at 1835 Massachusetts St. is going through some remodeling and should reopen sometime next week, store owner Steve Walter said. Most of the remodeling work is being done in the kitchen and other staff areas of the restaurant. The DQ had a major remodeling a couple of years ago, but most of that work did not reach into the kitchen and food-preparation areas.
Walter owns all three DQs in Douglas County — two in Lawrence and one in Eudora — and he said the work on the Massachusetts Street store is the latest in a multiyear effort to bring all the facilities up to top DQ standards.
You know you have found yourself in an interesting industry when you have a legitimate reason to ask a Secret Service agent: Should I handcuff the president? Welcome to Lawrence businessman Matt Baysinger’s wacky business.
Baysinger is the owner of Breakout Lawrence, the escape room business at 727 Massachusetts St. that locks people in a room and gives them a series of puzzles they must solve in less than an hour in order to unlock the door. He also owns the Breakout KC business and an escape room called Breakout Waikiki in Hawaii.
Perhaps you have heard that President Obama and his daughters recently visited the Breakout Waikiki location. Yes, that business is owned by a Lawrence resident. And it has created some stories that will last a lifetime for Baysinger.
Baysinger was eating Christmas Eve dinner when the manager of his Hawaiian location called him. The manager received Baysinger’s automated message that he was busy. But the manager sent Baysinger a text saying he really needed to talk to him.
“He told me President Obama and his family were coming to the breakout room,” Baysinger said. “I said ‘Yeah, you’re a funny guy.’ He said, ‘No, he’s going to be here in a half hour, and I’m freaking out.’”
Sure enough, the business had received a reservation a few days earlier, but they weren’t told the president was coming. Instead, they were only told a celebrity was coming who wanted to reserve all four of the business’ breakout rooms.
To make matters more interesting, the manager of the Hawaiian location actually wasn’t at the store. He also was on the mainland visiting family. A shift leader by the name of Mitch Massey was on duty, and was relaying all of this information to the manager. It was Massey’s first day on the job as a shift leader. It wasn’t all bad, though. Massey is a veteran from the Iraq War, and he shared a story with the president about how he voted for him while serving in Iraq.
A team of about 20 secret service agents arrived at the business about 45 minutes prior to the president’s arrival. Dogs were used to search the premises. Questions were asked. Background checks were conducted.
Then came time for Baysinger’s crew to ask an awkward question. President Obama and his family had signed up for the Mission Manoa room. Normally, that particular escape room involves all participants being placed in handcuffs to start the game.
“So, we asked the Secret Service whether we should place the president in handcuffs,” Baysinger said. “The answer was: ‘absolutely not.’”
As for other details about the breakout adventure, Baysinger said the room Obama participated in is based on the premise that you are an undercover operative in a foreign country. (No word on whether Mr. Putin also has played the game.)
“I think that was probably some fun role-playing for the president,” Baysinger said.
The room is considered the most difficult room to escape at the Hawaiian facility. The president, his daughters and a few other family members did escape — although just 12 seconds before the hour time limit.
“I was pretty nervous,” said Baysinger, who was able to watch it all remotely. “I was really hoping for everyone involved that he would get out.”
I asked Baysinger if the leader of the free world wasn’t able to get out, whether that was a sign the room was too difficult. Baysinger demurred.
“The great thing about breakout is it is a game of communication and teamwork,” Baysinger said. “If he hadn’t gotten out, we would have blamed someone else, not him.”
Baysinger has had the Hawaiian business since late 2015. He opened it a few months after opening the Breakout KC business. Baysinger’s mother grew up in Hawaii, and he had visited a couple of times. When Breakout KC started to flourish, he looked for expansion opportunities, and Hawaii had many of the right demographics.
“And then when you factor in that it is in Hawaii, it becomes a great idea,” said Baysinger, who does make a few trips to check on the business, coincidentally most often in the winter.
Baysinger opened the Breakout Lawrence business in March 2016. He said business is going well here too. In fact, the store plans to open its fourth breakout room at the 727 Massachusetts St. location in January. It will have a Civil War theme, and will have a lot of puzzles related to the Bleeding Kansas time period.
Who knows, maybe President-elect Trump is a Civil War buff. Just in case that doesn’t work, Baysinger has another plan to get Trump to try a breakout room. Baysinger’s Hawaii staff had sent a tweet challenging President Obama to try the breakout room during one of his vacations to Hawaii. Baysinger doesn’t know if the tweet played any role in Obama ultimately visiting the business. But Baysinger has a similar plan nonetheless.
“I’m going to tell my staff to send out another tweet throwing down the gauntlet to see if President Trump can beat President Obama’s time,” Baysinger said.
A conversation with LMH president and CEO Russ Johnson, plus a look at whether LMH will find a partner
As part of my effort to bring you more conversations with community leaders, I sat down recently with Russ Johnson, the relatively new president and CEO of Lawrence Memorial Hospital. Yes, I probably missed a golden opportunity because I did not ask him why the gowns are so drafty. Instead, I asked him about the hot breath of competition that LMH may be feeling more acutely these days.
Johnson took over the hospital’s top spot in August after the retirement of longtime president and CEO Gene Meyer. By December, he had gotten a welcome present from neighbors to the east. As we have reported, officials with KU Hospital confirmed construction work is underway on a new orthopedic clinic along Wakarusa Drive. It will be KU Hospital’s first expansion into the Lawrence market, and I opined at the time that may be a significant sign of things to come.
Johnson agreed that KU Hospital’s decision to have a clinic in Lawrence is significant. It was not a development, however, that caught him by surprise. Johnson said it is clear to him that partnerships, collaboration and scale are among the most important trends in the health care industry for today and tomorrow.
None of those ideas are likely to discombobulate Johnson. Although he grew up in the Kansas City metro area, he comes to Lawrence after having served as an executive at Centura Health System in Englewood, Colo., a suburb of Denver. Centura operates 17 hospitals and has affiliation agreements with 12 other hospitals throughout Colorado and western Kansas. It is Colorado’s largest health care network and has more than 21,000 employees.
“Centura was all about creating partnerships and scale,” Johnson told me. “That doesn’t really scare me.”
Those could end up being important words for the future of Lawrence health care. It seems clear that LMH will have opportunities to collaborate or partner with other health care organizations in the future. Whether those opportunities end up being the right fit is tough to say, but it sounds like Johnson is in a mood to explore them.
I did not get the impression, though, that such exploration will start and stop with KU Hospital. The KU Hospital may be a good fit for a partnership or a collaboration, but just because it has the KU brand in its name doesn’t mean that it is a given that it will partner with Lawrence’s largest health care provider.
“There are lots of options out there,” Johnson said.
The Kansas City market is full of them. There’s St. Luke’s, Shawnee Mission, Overland Park Regional, Olathe Medical Center and others. LMH may not limit itself to collaborating with just a single entity. Aside from watching whether any of those Kansas City hospitals form partnerships or collaborations with LMH, it will be interesting to see how many of them expand into Lawrence with or without an LMH connection.
Some of you may remember the late 1990s and early 2000s when new banks sprouted in Lawrence faster than dandelions. I wonder if such a trend will occur with health care facilities in Lawrence. Some of the same conditions may exist. Many banks came to Lawrence because they decided they wanted to try to remain an independent bank rather than be gobbled up through a merger. But to remain independent you needed to grow. To grow, you needed to have a presence in growing communities. Sadly, there are only a handful of communities in Kansas that are growing. Lawrence was and is one of them, thus Lawrence seemingly ended up on every bank’s radar screen. There may be hospital chains going through the same calculations currently. That doesn’t mean we should expect to see lots of new hospitals. Instead, think of clinics and other outpatient procedure facilities. The grand prize for a KC hospital would be a partnership with LMH.
Well, actually, the grand prize may be to purchase LMH. However, nothing in my conversation with Johnson led me to believe that LMH is looking to be sold. That would be an unexpected outcome. LMH has been very financially strong for more than a decade. Normally, hospitals that feel a need to sell do so because they are facing a shortage of financial resources. That’s not the case with LMH today.
“We are in the enviable position of being able to be thoughtful about whatever we do,” Johnson said.
As for some other takeaways from my conversation with Johnson:
• Don’t look for all the growth of LMH to occur at the hospital’s main campus at Fourth and Maine streets.
“Fourth and Maine has a critical long-term future as an inpatient facility, but a lot of our future will be in decentralized delivery,” Johnson said.
There still will be improvements made at the main campus, but Johnson characterized them more as improvements inside the existing walls of the facility “rather than new bricks and mortar.”
But other facilities — outpatient care is about 75 percent of LMH’s total volume — are possible. Johnson said he believes convenience is definitely at the “top of the consumer value proposition.” Hospital leaders will be keeping their eyes open for where the hospital needs to be offering services in order to be convenient to area residents.
• Figuring out new ways to deliver health care services will be critical to LMH’s success. Johnson briefly mentioned how people in the future will access health care services on their smart phones much more than they do today. He talked about how consumers, especially those with high-deductible health care plans, are going to shop around for the best price for a service more than they do today. And he said LMH will have to continue to offer more services in the areas of prevention and wellness. In addition to that being the right thing to do for people’s health, Johnson is betting that ultimately the way hospitals get paid will be tied back to factors such as health and wellness metrics. He said he doesn’t know how the Trump administration and changes to Obamacare will shake out, but he thinks hospitals already were destined to face changes to their payment models.
“Our payment model eventually will change,” Johnson said. “We won’t always be a fee-for-service type of business.”
Hospital leaders will spend the next several months thinking about what the future may look like. LMH is undergoing a formal strategic planning process. It seems clear that Johnson will play a role to help people understand that change sometimes is both good and necessary.
“If we continue serving the community in the same ways we always have, I think we become vulnerable to somebody who has a better mousetrap,” Johnson said.
Has the city just killed the proposal for a downtown grocery store? And other questions about City Hall’s new policy on incentives
There are many reasons a good number of people want a downtown grocery store. We had a recent article detailing how such a store may make life easier for people who live in nearby food deserts. Other people believe a grocery will help ensure the long-term vitality of downtown. And then there is me: I simply want a grocery store with a bakery case across the street from my office. (The engineers remind me there really is nothing simple about the steel girders that will have to be placed in the floor beneath my office chair.)
The reasons for a grocery store are not what’s on my mind today, though. Instead, I’m wondering whether city commissioners have killed the latest proposal for a downtown grocery store. In case you have forgotten, commissioners last week blessed a policy that essentially would prohibit the city from providing financial incentives to a project that includes any developer that is delinquent on taxes or special assessments.
The current proposal for a downtown grocery store has been put forward by Lawrence businessmen Doug Compton and Mike Treanor for the spot at Seventh and New Hampshire that previously housed the Borders bookstore. Compton has been in the news recently for being part of a development group that has more than $1 million in back taxes and special assessments on a struggling commercial development near 23rd and O’Connell. There is no question that a downtown grocery is going to seek financial incentives from the city.
So, upon watching commissioners last week say no more incentives for people behind on their taxes, I naturally wondered what that meant for the grocery store proposal. Thus far, the development group doesn’t seem too concerned that the policy will derail their plans.
“I think there is still very good support from the City Commission for a grocery store downtown, and the community wants it,” said Bill Fleming, an attorney for the development group. “We still will proceed on it. The talk has been about community benefit, and that is what this project really provides.”
OK, so the incentives policy hasn’t scared off the development group, but how does the project move forward if commissioners are serious about not providing incentives to developers who are behind on their taxes?
Fleming didn’t get into details on that point, but did say: “I don’t think it will have a negative impact on the grocery store project. Doug just wouldn’t get to be involved until he gets these other issues settled.”
I suppose one possibility is that Compton pays the $1 million plus in back taxes and assessments at 23rd and O’Connell, and commissioners pat themselves on the back for a job well done. For some reason, I don’t think that is how this gets settled. Another possibility is the grocery store project just no longer involves Compton. I find that highly unlikely too.
What seems more likely is the city’s new policy on incentives has more stretch to it than my waistband after a bakery sale on day-old pastries. To be clear, I don’t know how Compton will settle his issues of back taxes and assessments.
But what is clear is that there seems to be a lot of ways around the city’s policy. Here are a few that came to mind after I read the city policy, which simply says: It is the policy of the city that no economic development incentive will be granted to any applicant or petitioner who owns any financial interest in any real property, anywhere within the state of Kansas, with delinquent special assessments, delinquent ad valorem taxes, or federal and state tax liens, or who is currently delinquent or in default on any debts, responsibilities, or other obligations owed to the city.
— Ownership interests, or “financial interests” as the policy calls them, aren’t written in stone. If I owned a minority interest in a development group that was behind on taxes, what would prevent me from signing my interests of that failed company over to a son, a daughter, a spouse or a close business associate? At the point that I sign those interests over to someone else, would I no longer be subject to the city’s policy?
— Businesses have their own set of rules that generally are spelled out in a document called an operating agreement. Depending on how that agreement is structured, it may be very easy for me to simply forfeit — or perhaps sell for a $1 — my shares in the company. In that case, the shares go to the other remaining partners in the business. At that point, would I no longer be subject to the city’s policies?
— A property tax — or special assessment — liability isn’t really a long-term liability. If the development group that I’m a part of doesn’t pay its property taxes on a failed piece of commercial property, the tax liability goes away as soon as the property is put up for auction as part of the foreclosure process. Even if the auction doesn’t generate a high enough sales price to cover the tax bill, my tax liability is erased. At that point, would I no longer be subject to the city’s policy?
It sure seems like the policy may be an invitation for gamesmanship. Of course, as questions like these arise, the city may modify the policy to try to eliminate some of these loopholes. Likely, other questions then will emerge. Perhaps the largest question in all of this is: Has the city created a fair policy?
I will grant that it certainly seems like a policy that is grounded in common sense. Why would the city want to provide a financial incentive to someone who is behind on his or her taxes? But the issue became more complicated when the city drafted the policy to apply to any person “who owns any financial interest in real property . . .” I highlighted the word “any” because that is a key point.
What happens when I own a minority interest — say 10 percent — of a commercial development that is behind on its taxes? As the owner of 10 percent of the company, I don’t have any legal authority to order the company to pay its taxes, even if the money existed to do so. I have no legal authority to tell the other partners in the company to dip into their personal checkbooks and pay the property taxes. In theory, I could write a personal check to the Douglas County Treasurer to pay my share of the back taxes, but as the city’s policy is written that seemingly would do me no good. I would still have a financial interest in real property that is behind on its taxes. I suppose I could pay 100 percent of the back taxes even though I own only 10 percent of the company, but that doesn’t seem reasonable.
Of course, the city’s response very easily could be, so what? It is not like I have a constitutional right to receive a financial incentive from the city. What I may have, though, is a good project that could benefit the community for decades to come, but I need some help in bringing it to reality.
How this policy will impact the future of good projects in the city is unclear. It is possible that even if my business interests aren’t behind on any taxes that this policy may still kill future deals. That’s because this policy could become really problematic for bankers.
Say I have a good idea (I know, I’m asking you to stretch your imagination), and I go to a banker to get a loan for that idea. I tell my banker that I think I’m going to get $3 million worth of city incentives as part of this project. My banker factors that $3 million of relatively secure money into the equation when she considers whether she can loan me the money. Then she becomes aware of the city policy. That policy makes it clear that the city incentives could be revoked, if one of my business interests falls behind on taxes.
At that point, my banker needs to see all my business interests. She may trust me to stay current on my taxes, but she may not trust my business partner Joe Blow. Joe is the majority owner of several partnerships that I’m involved in. That creates a situation for my banker where actions of a company controlled by Joe may cause my project to lose my city incentives, which may be the difference in whether I can make my loan payment in full.
It seems like this policy could create a lot of uncertainty. Or maybe I’ve got it all wrong. This part of the policy is very new. Other parts of the policy went through a review process by various groups, such as the Public Incentives Review Committee or the Joint Economic Development Committee. This part of the policy was added after those reviews were completed.
To me, it seems like the city is in a struggle many of us often find ourselves in: a battle between idealism and pragmatism. There is little debate that this city policy is an idea that makes us feel good. No incentives to people behind on their taxes. Whether it is an idea that looks good for the future of development in the city is still an open question.
A Hilton hotel planned for west Lawrence; Eldridge files plans for outdoor expansion; signs of a new doughnut shop downtown
All-you-can-eat doughnuts, a pool table, free Wi-Fi and a host of other amenities all across the street from Free State High School: It sounds like a heck of a teacher’s lounge. Or maybe it just sounds like the plans for a new Hilton hotel in Lawrence. (That noise you heard was a teacher throwing an apple against the wall.)
Indeed, Lawrence City Hall has received a plan for a new Hilton hotel to be built in west Lawrence, but this may not be the type of Hilton you are used to. Plans call for a hotel dubbed Tru by Hilton. (The English teacher threw another apple over that spelling.) It is a relatively new concept for Hilton. It dubs the hotel as a place where you can discover “what cost-conscious meets cool-conscious looks like.” From what I’ve seen, the brand uses quite a bit of modern design and hip phrases, like calling its lobby a “Hive.”
More on the concept in a moment, but first some basics about the project. The hotel is slated for the vacant lot at the corner of Wakarusa Drive and Overland Drive, or, in other words, the property that is just north of the tunnel car wash business. That puts it basically across the street from Free State. Plans call for the hotel to be four stories, include 82 guest rooms and an outdoor recreation area, which I assume will include a pool and other amenities.
The project will be part of the Bauer Farm development, and, at the moment, would be the most western hotel in the city. Bill Fleming, an attorney for the Bauer Farm development, said hotel developers became more interested in the Bauer Farm project after the Rock Chalk Park sports complex opened about one mile to the west in far northwest Lawrence.
“It is the type of activity that we thought would be spurred by Rock Chalk Park, and now we are seeing it,” Fleming said. “I think Bauer Farm is a good area for it. It has some shopping, it has the community theater, it has quite a few amenities nearby.”
The project, though, serves as a good reminder of the uphill battle developers are facing to bring commercial development to the area near Rock Chalk Park. The property adjacent to Rock Chalk Park has been zoned for commercial development for years, but has remained vacant, even though Rock Chalk Park is attracting good crowds. It is difficult to get a business to take the risk and expense associated with being the first to locate at a site. Some people have thought a hotel would be the first to take that chance, but not yet.
The development group behind the Tru by Hilton is an Ardmore, Okla.-based company called Apollo Hospitality, according to the development plan filed at City Hall. According to its website, it looks like the company has about five hotels in Oklahoma and Texas.
As for the concept behind a Tru by Hilton, it looks intriguing. I don’t believe that there is a Tru by Hilton in Kansas yet. I found on Hilton’s website where one is under construction near the Oklahoma City airport. No guarantees that the Lawrence one will be exactly like that one, but let’s take a look anyway.
As I mentioned earlier, the hotel calls its lobby a Hive. It features a breakfast area that includes a “topping bar” that has 30 “sweet, savory and healthy ways to sprinkle your food with personality.” The hive also includes a lounge area, a market to buy snacks and other items, and a game room, complete with a pool table. Here are some images from the hotel’s website.
And here is a look at what the exterior of the hotel in Oklahoma City is slated to look like. I haven’t seen a rendering for the Lawrence project, but they both are four-story facilities.
Oh yeah, there also are guest rooms. They’re touted as having 55-inch TVs, hardwood-like floors and extra large bathrooms, among other amenities.
The proposed site for the Lawrence hotel already is zoned commercial. The project just needs to receive final development plan approval from City Hall, which usually is just a technical approval related to site layout and such. No official word on a timeline for the project, but I would suspect construction wouldn’t begin until spring, at the earliest.
If the project does move forward, it would be just the latest news in Lawrence hotel development. As we have reported, Country Inn & Suites plans to build an 89-room extended stay hotel on the property previously occupied by Don’s Steakhouse near 23rd and O’Connell in eastern Lawrence. I also continue to hear that Candlewood Suites continues to be interested in building a hotel in Lawrence, perhaps near the Sixth and Iowa site that previously housed the Ramada Inn.
In other news and notes from around town:
• Add one more hotel project to the mix. I’m still gathering some details, but a plan has been filed to build a large outdoor seating area in the vacant lot next to the Eldridge Hotel in downtown Lawrence.
Over the years, the Eldridge has proposed to add rooms and amenities by undertaking a multimillion dollar expansion into the vacant lot, which is just south of the hotel. But those plans have not gotten off the ground.
Now, Lawrence-based architect Paul Werner has filed plans for a more modest expansion. This one calls for about a 2,700 square foot addition that would house an enlarged kitchen for the hotel’s restaurant, plus an area to house a number of outdoor dining tables that would have a view for people watching along Massachusetts Street.
If I’m reading the plans correctly, it looks like there would be space for about 20 outdoor tables, which probably would make it the largest outdoor dining area in downtown. It looks like the area also would have some nice landscaping.
I’ll work to get some more details from Werner and Eldridge officials after the holidays and pass them along. It will be interesting to see if the expanded kitchen is a sign of a major change to come in the offerings and concept behind the hotel’s Ten restaurant. I’ll let you know when I hear more.
• I also don’t have many details on this at the moment, but couldn’t let it sit through the holidays. A development permit filed at City Hall indicates a new doughnut place is coming to downtown. A sign permit has been filed for a business called Wake the Dead Donuts. It would be located at 918 Massachusetts St., which formerly housed Burger-Fi.
A doughnut shop is plenty intriguing, but a picture of the proposed sign took intrigue to a whole new level. The sign lists that the business will serve chicken, doughnuts and whiskey.
Trust me, I'm working to get more details on this one. If need be, I’ll even experiment with the concept myself.
• One last note of a housekeeping nature: Town Talk will be a bit sporadic for the next few days, as I will take some time off for the holidays. Merry Christmas and happy holidays.
New downtown shop with Kansas and Lawrence apparel opens; new art space along Mass Street; sandwich chain opens on 23rd
There are reasons unrelated to a Jayhawk to show your Kansas pride: It is a natural segue to talk about the Wizard of Oz, it gives people from the coasts an opportunity to tell us how beautiful the state was when they flew over it, and, of course, it is affirmation that we don’t live in Missouri. If Kansas pride is your thing — or even better, Lawrence pride — there is a new downtown shop for you.
Mass St. Mercantile has opened at 738 Massachusetts, in the spot that formerly housed Kieu’s clothing boutique. Mass St. Mercantile also has a lot of clothes, but of a different nature than Kieu’s. Mass St. carries lots of T-shirts and hats that have a Kansas slogan or something about Lawrence. Yes, there will be some Jayhawk apparel too, but mostly the shop will focus on items that promote Kansas but not necessarily the Jayhawks.
Lawrence businessman Matt Lomshek, a co-owner of the mercantile, said the shop also will have plenty of Lawrence High and Free State High apparel. Lomshek is in a good position to produce shirts, apparel and other branded merchandise of about any kind. He is an owner of Varsity Team Apparel and Destinations Apparel, a pair of businesses that serve as a wholesaler to a variety of boutiques and retailers across the country, and also provide merchandise for resorts.
Lomshek said he had been interested in figuring out a way to sell some of his company’s merchandise closer to home, then was approached by the owners of Junque Drawer Boutique, an Olathe-based retailer that long has been looking for an opportunity to expand into Lawrence. Junque Drawer provides some of its merchandise for Mass Street Mercantile. When you add it all up, the store has T-shirts, hats and a lot of novelties ranging from wall hangings to decorative wine bottle stoppers to more wall hangings.
“We try to have fun with it,” Lomshek said of the novelty items. “There’s a lot of stuff to laugh at.”
To wit: a postcard that says “We’ll always be friends, you know too much,” or a can koozie that says “If you can read this, bring me another beer.” (My experience tells me you perhaps should be prepared to catch it, or at least be prepared to duck.)
In other news and notes around town:
• Maybe you want to show your Kansas pride in a slightly different way. There is a somewhat new art gallery in downtown that may be able to help. I say somewhat new because The Phoenix Underground has opened in the downstairs space beneath the longtime downtown occupant The Phoenix Gallery at 825 Massachusetts St. The underground space will be operated by the same folks who operate The Phoenix Gallery.
The Underground may be a good spot for you Kansas lovers because it is now carrying Louis Copt’s work, the noted Lawrence artist who specializes in Kansas landscapes. Lawrence artist John Sebelius also has his work at the Underground.
But the space also is allowing The Phoenix Gallery to expand its presence in the craft market. Part of the downstairs space is devoted to work produced by artists in the Lawrence Craft Collective.
“We’re really calling it handmade market,” said Sue Shea, director/manager of The Phoenix Gallery.
That part of the store carries items such as candles, soaps, gloves, jewelry and other items made by craftsmen and women selected by Craft Collective leader Jill Stueve, said Shea.
“The space gives people a lot more places to explore for art and crafts,” Shea said.
• We have mentioned a few times before that the chain Potbelly Sandwich Shop has plans to open in Lawrence. Well, today is the day those plans become reality. The store opened for business this morning at 1618 W. 23rd St., in the spot that previously housed Dunn Brothers Coffee.
The business yesterday held a special pre-opening event where it served food and raised money for the PTA at Schwegler Elementary, which is right around the corner from the restaurant. As far as the restaurant goes, it serves a large menu of toasted sandwiches, and hand-dipped shakes also are a big deal. The restaurant also is touting that it will have lots of live, local music. It sounds like they have musicians playing during many of the lunch and dinner hours. A press release said local musicians interested in a gig should stop by the store to arrange for an audition.
The company, which got its start in a Chicago antique store in the 1970s, now has about 400 restaurants across the country. A press release said the Lawrence store employs about 20 people.