It is becoming a familiar issue for city commissioners to consider: Should a new multistory building in downtown Lawrence be offered some sort of financial incentive from the city?
It looks like the next project commissioners will be asked to consider is a proposed five-story commercial/residential building along Vermont Street that former City Commissioner Bob Schumm hopes to build.
Back in June, we reported that Schumm had plans for a major building on the vacant lot that is just south of the old Headmasters salon building in the 800 block of Vermont Street. Well, the proposal has changed a bit since then — we reported on some changes in August — and Schumm said he is getting closer to moving ahead with the project.
But Schumm told me he has decided he’s going to need a city incentive to make the project work as planned. Schumm said he plans to file this month an application for a property tax rebate through the Neighborhood Revitalization Act. No word yet on exactly how large of a rebate the project may seek. The city has given out rebates in the 50 percent range to 85 percent.
Schumm said there is one particular part of the project that makes the incentive needed.
“The project is going to have 22 underground parking spaces that are very expensive,” Schumm said.
That is becoming a theme with projects in the downtown area: Developers need help paying for parking.
Downtown is an interesting area when it comes to parking. For decades, the city’s code for parking in downtown has been different than it is in other areas of town. (My wife’s code for parking in downtown is different too, which is why you sometimes have to walk around a Ford Taurus on a sidewalk.) Along the key stretches of Massachusetts, New Hampshire and Vermont, buildings can be constructed without having to provide any off-street parking for customers or tenants. The city long ago decided the downtown area would be served by public parking.
One thing that has changed in recent years, though, is the city is urging more development of a residential nature in downtown. As more people live in downtown, more of a strain gets put on the public parking supply. Developers — I’m specifically thinking of the development at Ninth and New Hampshire — have said they’re willing to put in their own private, below-ground parking garages to accommodate some of the new parking demand they are creating. But they often say they can’t put in the parking and still have a financially viable project without some assistance from the city.
The previous City Commission was pretty amenable to providing that assistance. Schumm’s project, though, is really the first such test for the new commission, so it should be interesting to watch.
I’ve heard some people say the city needs to just start requiring new construction in downtown to provide its own parking. I’ve heard others say that would be a momentum-killing strategy for downtown. It would create a two-tiered system in downtown: Hundreds of businesses get to take advantage of a code that doesn’t require them to provide for parking, while businesses that have come to the scene more lately have to take on the private expense of providing parking. And I have heard others, yet, say that instead of subsidizing developers to build private parking in downtown, the city simply needs to build more public parking. That, though, will take some new city resources, and perhaps some adjustments of parking rates. So, a lot to keep an ear open for on parking issues.
As for Schumm’s project, see below for some renderings from Lawrence-based architects Hernly Associates. The project is proposed to have a bank — the specific bank hasn’t been identified yet — on the ground floor, and 32 single offices of about 200 square feet each on the second floor, and 11 condos that will be for sale on the third and fourth floors. The fifth floor also will have a large condo, but don’t expect it to be for sale anytime soon. Schumm — who spent most of his career downtown as a restaurant owner — said he and his wife plan to sell their west Lawrence home and move into the top floor condo.
“When they take my keys away, I can walk to the senior center and everything else that is in downtown,” he said.
Any incentive request for the downtown project — which is being called Vermont Place — would first go to the city’s Public Incentives Review Commission for a recommendation and then to the City Commission for a final vote. The building's design already has won approval from the city's Historic Resources Commission, Schumm said.
Lawrence tops $200 million in building projects for first time in city’s history; longtime construction company to close Lawrence operations
The number that has caught my eye this morning is $200 million, and thankfully it didn’t come from my friends at Visa. It is from the city’s latest building permit report. The city has topped the $200 million mark in construction projects for the first time in history. (The true total is actually a lot higher because the city's figures don't include the bulk of the school projects underway or the work happening on the KU campus. Plus, building permit totals don't capture other types of construction, like the more than $190 million worth of road work as part of the South Lawrence Trafficway project.)
The latest report shows building permits issued in October, and the fall season was a good one on the construction front. The city issued permits for $12 million worth of projects in the month. That brought the year-to-date total to $206.9 million.
We previously have reported that the city had set a new building total record. Back in August the city broke the previous record of $171.9 million that was set in 2013. So, now the city is just adding to the record.
Perhaps the most noteworthy number in the report is that single-family home construction experienced its best month of the year in October. Builders pulled permits for 28 single-family homes, topping the previous high mark of 21 set in June. When you add duplex construction to the mix, the city has issued 211 permits for single-family and duplex construction in the city thus far in 2015. That’s the highest total in at least the last six years, according to figures from the city. Not only is the number higher; it is a lot higher. At this time in 2014, the city had issued only 88 permits for single-family and duplex construction. The five-year average has been 112 units.
The numbers seem to be a sign that the construction industry is betting that the housing market in Lawrence is in for a pretty good run.
The city report also noted a couple of projects worth keeping an eye on. Permits have been issued for a new industrial building in front of the Comfort Inn and Suites near McDonald Drive and Princeton Boulevard. As we previously have reported, a group led by Lawrence businessman Thomas Fritzel is building a storage unit facility there. Based on the plans I’ve seen, it won’t be mini-storage units; rather, the plans show three climate-controlled buildings that will be constructed on the site. My understanding is Fritzel plans to relocate some of his construction firms that are using some downtown space into those buildings. I suspect some of the buildings also may be for lease to other firms that have storage or warehouse needs, but I don’t have any definitive word on that. That project pulled permits for about $775,000 worth of work, which made it the largest project of October.
The city’s report also notes a building permit has been issued for remodeling work at Sports Pavilion Lawrence, the city-owned recreation center at Rock Chalk Park. The work is part of Lawrence Memorial Hospital’s plan to renovate vacant space in the center into a sports therapy location for the hospital. The city issued permits for about $150,000 worth of remodeling work at the center.
In other news and notes from around town:
During this season of holiday buffets, I pretty much always carry the equivalent of a concrete block in my stomach. But if you want the real deal, there’s soon going to be one less option in Lawrence. A concrete block company that has had ties to Lawrence for more than 50 years is leaving the city at the end of the month.
Capitol Concrete Products has confirmed it is closing its North Lawrence facility at the end of the month and transferring workers to the company’s Topeka plant. Capitol Concrete sells concrete blocks, bricks, pavers and other types of materials to contractors and the general public. It has been in the Lawrence market since 1998, but its Lawrence lineage dates back much further. The company bought the Lawrence-based Morton’s Building Materials in 1998. Morton’s had been in operation in Lawrence — primarily on East 15th Street — since at least the 1940s.
Capitol Concrete had closed the production part of the Lawrence operation years ago and had just four employees at the Lawrence location, which served as a distribution and retail center. Jon Forsberg, manager at the Lawrence center, told me three of the four employees are transferring to other positions with Capitol Concrete, which has a production plant in Topeka.
Forsberg said the concrete block business did see a decline during the recession, but said business had picked back up. He directed questions about why the company is leaving the Lawrence market to Capitol’s parent company, which is The Monarch Cement Company in Humboldt. I put a call into an executive down there, but haven’t heard back yet.
UPDATE: I did hear back from Kent Webber, executive vice president of Monarch. He said the fact that the Lawrence office no longer produced any products but rather was only a sales office led to the decision. He said the company will keep its sales representative stationed in Lawrence, and the representative will continue to call on commercial accounts. The North Lawrence business was open to the public, but Webber said the big box home improvement retailers had cut down on the amount of retail business the location did.
Capitol Concrete’s North Lawrence facility is in the small industrial park that is just north of the Tee Pee Junction, which also is known as the intersection of U.S. Highway 24/40 and U.S. Highway 59. Forsberg said Capitol Concrete owns the facility and would be seeking a buyer for the several-acre site. Webber said the company has had conversations with a couple of potential buyers, but has not made any decision about what to do with the property. The company several years ago sold its East 15th Street facility. It is owned by the city of Lawrence.
More than $30 million in public projects push local construction industry to banner year in 2013; Mass. Street gets recognized by Country Living magazine
The idea of a new federal stimulus program got nowhere in 2013 in Washington, D.C., but the concept was alive and well when it came to the Lawrence construction scene.
At least that's one way to read the year-end numbers for the city's building industry. The city's construction industry had both a bounce-back year and an unusual year. The latest report out of City Hall shows $171.9 million worth of new construction projects were started in Lawrence in 2013, easily shattering any marks set over the past five years.
But the report also notes $30.5 million of the projects were government funded. In other words, nearly 18 percent of all the projects in the city were funded by the public sector. The city has only starting keeping track of public vs. private sector projects in the past few years. So I don't have a lot of data to compare these numbers to. But compared to the average of the previous two years, the amount of public sector construction has grown by about 230 percent.
And if you wanted to argue over Rock Chalk Park — now there is a phrase that is both cocked and loaded — you could debate that the public sector numbers are much higher. The largest construction project in the city was the $31 million in permits issued for what is commonly referred to as the KU portion of the Rock Chalk Park sports complex — i.e., the track, softball and soccer fields and facilities. For building permit purposes, the city is counting that as a private-sector project. That is fair because the project is being financed privately by a group led by Lawrence businessman Thomas Fritzel, and that group will own the facilities. As we've reported, KU merely will lease the facilities.
But in almost every other way, the city has treated the project like a public project. For example, the city has agreed to give the privately-owned facilities a 100 percent tax abatement and a rebate on building permit fees accrued by the project. Normally, only public construction projects get such tax and fee breaks, but commissioners at the time of approval contended the Rock Chalk Park complex was essentially a de facto public project since KU would be it main user.
So, if you treat Rock Chalk Park as a public project, the amount of public sector construction in the community grows to $61.5 million, or about 35 percent of all construction that took place in the city. (Well, construction of buildings. These numbers don't include road construction or utility construction, nor do they include most of the construction KU does on its campus.)
This year may be the beginning of a trend. Don't forget that the school district still has lots of construction work to do as part of its $90-plus million bond project approved by voters, and the city will spend tens of millions of dollars in coming years to build a new sewer plant south of the Wakarusa River.
Now, please, don't mistake my pointing out these numbers as my making a judgment about them. Certainly, all the public projects went through a public process to win approval. Some went before the voters — like the expansion of the library — while others — like Rock Chalk Park — were simply approved by the City Commission. And all of them were approved for reasons that went well beyond providing the local construction industry a boost. But it does seem worth noting how much of a boost the public coffers have given the industry this year.
And to a degree, a lot of this is pretty subjective. The Marriott TownPlace Hotel at Ninth and New Hampshire was the second largest building project in the city with $13.8 million in permits issued in 2013. It is counted as a private project, but it is receiving a variety of public tax incentives. So, determining where private ends and public begins can be a bit difficult in today's environment.
Here are some other figures from the year-end report:
— The $171.9 million worth of projects is up from $100.6 million in 2012, $115.7 million in 2011, $101.8 million in 2010 and $75.3 million in 2009. I haven't had time to fully research it, but the $171.9 million may be the highest total in more than a decade, although to be fair the numbers should be adjusted for inflation.
— As we have been reporting all year, single-family home construction had its second bounce-back year in a row. The city issued 165 permits for single-family and duplex homes. That's up from 126 in 2012 and 99 in 2011. The numbers are still off the 300 homes that were being built per year during the real estate boom, but at least the 200 level is within sight, and that would be a significant milestone in the industry's recovery.
— Construction of new apartments was through the roof in 2013. The city issued permits for 374 living units. That's up from 184 units in 2012. The mark also surpassed the previous five-year high of 363 units in 2011. In case you want to keep track, the community since the end of 2008 has added 1,313 apartment units compared to 672 single family or duplex units.
— Here's a look at the 12 projects that received more than $1 million worth of building permits in 2013: 1. Rock Chalk Park (the non-city portion): $31 million 2. Marriott Town Place Hotel, 900 New Hampshire: $13.8 million 3. Apartment complexes near Sixth and Congressional: $13 million 4. City recreation center at Rock Chalk Park: $10.5 million 5. Lawrence Public Library addition: $9.9 million 6. Bioscience and Technology Incubator expansion: $6.6 million 7. Camson South Apartments, 525 Congressional Way: $5.5 million 8. Hallmark Cards manufacturing plant renovation: $4.5 million 9. Dick's Sporting Goods, 2727 Iowa: $3 million 10. Neuvant House of Lawrence, 1216 Biltmore: $2.5 million 11. Dillons Food Store renovation: 3000 W. Sixth Street: $1.2 million 12. Discount Tire, 4741 Bauer Farm: $1 million
In other news and notes from around town:
• My Shirley Temple dimples may not be in full form today, but I guess I can be cute in another way: I can take a stroll down Massachusetts Street. The downtown drag recently has gotten a dose of national publicity by being named the "Cutest Small-Town Street in Kansas" by Country Living magazine. The short article about downtown Lawrence mentioned several businesses as hot spots, including The Toy Store, Sarah's Fabrics, Sylas and Maddy's, Mass Street Sweet Shop, and Liberty Hall.
More LJWorld City Coverage
Raise your hand if you believe pajamas ought to be the new business casual. I’m betting today’s blizzard has lots of folks working from home in their pj's today.
One group that you won’t find working in pajamas often is builders. (Trust me, if you try to hang a hammer from a pair of pajama bottoms, bad things happen.) And there is a new report out of City Hall that suggests January was a reasonably busy month for the Lawrence construction industry.
These days, when the Lawrence construction industry is busy, the best bet for the reason behind it is apartments. That’s the case this time, too.
City officials issued building permits for $11.9 million worth of new apartments on the large open site just west of the Wal-Mart at Sixth Street and Congressional Drive. The project — which carries an address of 5100 W. Sixth St., if you are scoring along at home — calls for 264 dwelling units in 11 buildings.
If you are trying to picture the site, it is the location that Lowe’s once was interested in. But as we began reporting last summer, apartment developers became interested in the property after Lowe’s slowed down its expansion plans. I’m not entirely clear on which developer is behind this project. At one time my understanding was that a local builder — although not one of the big apartment developers like a Schwada or a Compton — was behind the project. But the apartment industry has been full of change in Lawrence, so I had better do some more checking before I repeat a name.
I have a feeling we will have a lot of opportunities to talk about apartments in 2013. City commissioners at their Tuesday evening meeting approved the preliminary development plan for The Links, which we’ve previously reported is a major apartment development that will be built around a nine-hole golf course. That development is slated for the area northeast of Sixth Street and George Williams Way. In other words, across the street from the proposed Rock Chalk Park sports village.
The Links project — which is proposed by a group out of Arkansas — is slated to have 630 dwelling units. Add that to the 264 units that just pulled a permit next to Wal-Mart, and you are to almost 900 new units being built in the Sixth Street corridor alone. Plus, the Langston Heights development southwest of George Williams Way includes plans for 86 apartment units.
It seems that folks are betting on growth again.
A lack of growth in jobs is what Lawrence leaders have been bemoaning though. The January building permit report has important news on that front as well.
The first signs emerged of Hallmark undertaking an expansion to accommodate the extra work that the plant is planned to undertake as Hallmark closes its Topeka greeting card plant.
The company pulled a permit for $600,000 worth of work at the facility. The building permit report categorized the permit as “phase one” of an expansion project.
I’ll do some checking with Hallmark to see if they are releasing more details about their expansion plans. When the Kansas City-based company made the announcement in October of the Topeka closing, it was unclear how many new jobs may be added to the Lawrence facility. The company said it expected its total workforce in Lawrence, Topeka and Leavenworth to drop from 1,300 to 1,000, but the workers would be split between two plants instead of three.
It was clear, though, the move was going to have impacts on the Lawrence plant because it would become the sole manufacturer of Hallmark greeting cards. Previously, it manufactured about two-thirds of the greeting card line, while Topeka manufactured the other third.
Here are some other numbers from January’s building report:
• The city issued permits for $16.8 million worth of construction. That by far made it the best January in recent memory. Over the past four years, the January average was about $3 million worth of projects.
• Activity on the new-home front continued to be a bit slow. The city issued permits for eight new single-family or duplex homes, compared to seven in January 2012.