Kansas City grocery company signs deal to locate store in downtown Lawrence; lawsuit could still derail project
A full-service downtown grocery store — complete with a pharmacy and a Mongolian grill — is now closer to becoming a reality than ever before. But a Douglas County court case could still deal the project a major blow.
As expected, Queen’s Price Chopper of Kansas City has signed a letter of intent to locate a Price Chopper grocery store at Seventh and New Hampshire streets, on the site of the former Borders bookstore.
A development group led by Lawrence businessmen Mike Treanor and Doug Compton have filed plans at City Hall to tear down the old Borders bookstore and replace it with a three-story building that would include the ground-floor grocery store and two levels of apartments above. The filing of formal plans — an incentive request also will be filed — marks the largest step yet in a multiyear effort to bring a grocery store to downtown. But the project is still in jeopardy of receiving a major setback from a Douglas County lawsuit.
As we reported in December, a pair of condo owners in the adjacent Hobbs Taylor Loft building have filed a lawsuit alleging that the development group is seeking to do an end run around a set of covenants that prohibit a large grocery store from being built on the Borders property. The development group disagrees. The development group filed a motion to dismiss the lawsuit. A hearing was held at the end of March, and now the parties await a decision from Douglas County District Court Judge Kay Huff. If the lawsuit isn’t dismissed, it is presumed Huff will issue an injunction that will stop work on the project. That makes the stakes of her decision high.
“If there is a ruling that says we are under an injunction, it probably will be close to a death knell,” said Bill Fleming, an attorney who represents the development group.
The injunction wouldn’t stop the development group and the two residents — Brian Russell and Brent Flanders — from settling the lawsuit, but it is unclear to me whether such a settlement is likely. As for the timing of the court’s decision, that is anyone’s guess, although it has moved fairly quickly thus far by judicial standards.
Absent the lawsuit, excitement levels are high for the project. The development will need to win several city approvals, and the developers are making no secret about the fact that they will be asking for incentives. Those will include a tax increment finance district that will rebate back large portions of property and sales taxes to the project, plus a low or no-interest loan that will help equip the new store.
But developers say the community will be getting what it long has asked for: a downtown grocery store that is big enough to serve not just the downtown but surrounding neighborhoods like North and East Lawrence.
“There will not be anything lacking from the grocery side,” said Dennis Reilly, chief financial officer for Queen’s Price Chopper. “It will be one-stop shopping.”
Here’s a look at some the of the details from the latest plans:
• The approximately 20,000 square-foot Borders building would be demolished and would be replaced with a three-story building that would have a footprint of about 40,000 square feet. The ground floor would house the grocery store.The second and third floors would house 82 apartments that would include a mix of studio, one-bedroom and two-bedroom units. Fifteen percent of the apartments would rent at rates that meet the city’s new affordability standards.
• The project would include a two-level, underground parking garage built beneath the new building. The garage would have 182 spaces. The lowest level of the garage would be gated and reserved for the use of apartment tenants. The other level — about 91 spaces — would be available for grocery store customers. In addition, the project would have about 80 above-ground parking spaces around the store. About 60 of them would be in the existing lot just south of the current building. About 15 angled parking stalls would be added on New Hampshire Street and about five angled stalls would be added on Seventh Street. All the above ground parking is anticipated to be public parking that would be managed by the city, which means it could be metered spaces or could be two-hour free parking.
• In case you are wondering how you get your grocery cart to your car in the below-ground parking garage, the store’s design includes an escalator specifically built for grocery carts. The store would have a standard escalator, and next to it is one that is designed to grasp a grocery cart.
“You can stay with your cart, but you can’t ride in the cart,” Fleming said. “At least I don’t think you can.” (We’ll see about that.)
• The store will have many of the same features as the Queen’s Price Chopper at 151st and Metcalf in Overland Park, Reilly said. That store is twice as large — at 80,000 square feet — but the Lawrence store will be designed in a way to accommodate the same basic features. At 40,000 square feet, the Lawrence Price Chopper will be similar in size to the Dillons store on Massachusetts Street.
• Among the features the store will have is a drive-thru pharmacy. The drive-thru will be on the south side of the building. The store also will have a sushi bar, a Mongolian-style Asian grill, an American grill, cold sandwiches, a coffee shop, a large indoor dining area and a patio seating area. The store also will have a floral shop, a bakery, a full meat counter and all the grocery items you would expect. Reilly said the store’s produce department is being given special attention. The store will be designed so that the produce department is visible from the street.
“Produce is a real emphasis for us,” Reilly said.
• The project will need to win multiple approvals from City Hall in order to move forward.
“The project is going to need some help,” Fleming said.
The project will have to go through the historic resources review process, since downtown is part of a historic district. The Borders building only dates back to the 1990s, but the site includes an old wall from a livery station that used to occupy the site long ago. Keeping that wall was part of a compromise reached with historic preservationists who objected to the construction of the Borders building in the 1990s.
• City Hall approval of an incentives package will be critical, Fleming said. He said the project will ask for tax increment financing, which is a mechanism that allows the development to receive a rebate on new property and sales taxes generated by the development. Fleming said the TIF is needed to help pay for an estimated $7 million worth of expenses that will be incurred to build the underground parking garage. Fleming, though, said the project is not currently expected to ask for a transportation development district tax. That’s significant because a TDD would impose a special 1 percent sales tax on the grocery store.
“We want to keep the groceries as affordable as possible,” Fleming said. “There already is a concern about how regressive sales taxes are on groceries, so we want to avoid that special tax.”
The project also is expected to ask for about a $2.25 million no-interest or low-interest loan that would be used to equip the grocery store with items such as freezers, shelving and other items needed to make the store functional. The loan would be repaid to the city as long as the grocery store hit certain sales targets.
• A key piece of federal assistance also will be needed. The project will apply for federal new market tax credits. Those tax credits will be used to help finance the project, which is expected to have a total private price tag of more than $20 million.
Those tax credits are awarded through a competitive process. If the project were not awarded the tax credits, Fleming said the project would be in jeopardy. The development group should know in about a month whether it has won any tax credits this year. Fleming believes the project stands a good chance of winning tax credits.
“I think the odds are high that we will get the credits, but it is not a simple process,” Fleming said.
He said the fact that the downtown area and surrounding neighborhoods are part of a “food desert” should go a long way in securing the tax credits. The food desert designation refers to residents needing to travel a good distance to have access to fresh food. Both the North Lawrence and East Lawrence neighborhoods have been advocating for a downtown grocery store to address the food desert issue.
If approved, this will be the sixth store for Queen’s Price Chopper. It operates stores in Overland Park, Paola, Spring Hill and Bonner Springs.
Reilly said demolishing the Borders building to allow for a larger store to be built is a key part of the plan. He said the company explored using the existing Borders building but didn’t feel comfortable that it would be large enough to act as the full-service grocery store that he believes community members want.
“This will allow us to have the full variety of offerings that will make it a destination for shoppers,” Reilly said. “You want a store that the community can be proud of, and we know the store has to have what the customer wants.”
Compton plans to build five-story apartment building at Pachamamas site downtown; grocery project moving along; West Lawrence RadioShack store to close
Get ready for another multistory apartment project in downtown Lawrence. Local businessman Doug Compton has confirmed he has a deal to convert the Pachamamas restaurant building at Eighth and New Hampshire into a five-story building that will house about 60 apartments.
As we previously reported, the owner of Pachamamas had put the building on the market and plans to shut the restaurant down after Valentine’s Day (which, sweet mother of Holy Roses and Overextended Bank Accounts, is Saturday.) Compton told me he has signed a contract to purchase the building, and expects to close on the deal by mid-May.
But don’t look for the building to get torn down. Instead, look for four additional stories to be built atop the existing structure. The building used to be an armory and was built to a heavy-duty standard. My understanding is the building was constructed to allow a helicopter to land on the roof, and Compton said he has photos of tanks parked on the roof. (Don’t look at me, I wasn’t driving.)
Engineers have attested that with just a few modifications the building can easily support another four stories. Compton said that is appealing because it could put the project on a fast track. He said he plans to have the project under construction this summer. That would mean Compton would have two multistory apartment buildings under construction on New Hampshire Street at the same time.
He said work is expected to begin any day on a seven-story apartment and office building at the northeast corner of Ninth and New Hampshire streets, on the site where Black Hills Energy previously had its offices. The project, which was approved by city commissioners last year, is expected to add about 115 apartment units to downtown.
The current proposal for the Pachamamas site would add 56 new apartments, with most being one- and two-bedroom units, Compton said. But unlike the project at the northeast corner of Ninth and New Hampshire, the Pachamamas project won’t include an underground parking garage. Downtown zoning allows projects to be constructed without providing off-street parking. Compton said he is not planning to build a parking garage as part of the project. He said by not spending millions on a parking garage, he expects that will allow for lower rental rates than what he has been able to offer at his other downtown projects.
“We’re trying to bring this in at a different price point,” Compton said.
The project still needs to win approval from Lawrence City Hall. It will face hearings at the city’s Historic Resources Commission and also may need City Commission approval, especially if the project requests any financial incentives. Compton didn’t say whether the project would seek any incentives.
If the project moves forward it will be the third major apartment project Compton had undertaken on New Hampshire Street since 2011. He started with the 901 Building at the southwest corner of Ninth and New Hampshire streets. When the Pachamamas site is completed, Compton’s projects will have added a little more than 225 apartments in essentially a one-block stretch of New Hampshire Street. Compton also was the lead developer on the multistory building at the southeast corner of Ninth and New Hampshire that houses a Marriott hotel.
“We feel like we’re really close to changing the whole dynamics of New Hampshire Street,” Compton said.
As for Pachamamas, it appears the fine-dining establishment is in its final days. UPDATE: I got in touch with Ken Baker, chef and owner of the establishment, and he said the restaurant will be open through Valentine's Day, but that will be the last night of business for the establishment.
Baker said he doesn't have any other restaurant ventures planned at the moment, but said he wouldn't rule it out for the future.
"There has just been a crazy outpouring of emotion from clientele and staff over the last several weeks," Baker said. "It has been a wild ride, and a big part of me will miss it. But I think there is more on the horizon."
Compton said he did not purchase any part of the restaurant business. He said the ground floor of the building will be used for a restaurant or retail use, but he said he did not have a tenant in place.
“If somebody wants to lease the space and open that type of restaurant again, I’m happy to do it,” Compton said. “I don’t have anything lined up for it yet.”
In other news and notes from around town:
• Compton said that plans to bring a grocery store to the corner of 11th and Massachusetts streets are progressing well. As we previously reported, owners of the Lawrence-based Checkers grocery store want to open a grocery as part of a multistory building Compton hopes to build at the site of the Allen Press property in downtown.
Compton said his group has been tweaking a few aspects of the design and parking plans for the project after having further meetings with officials from Associated Grocers, the wholesale provider for the grocery store.
“Everything is still moving along,” Compton said.
That project, which would be a seven-story building that would include office and apartment uses, must still win several approvals at City Hall.
A group of residents, led by City Commission candidate David Crawford, continue to lobby to have a grocery store project proceed at the former Borders bookstore site at Seventh and New Hampshire streets. My understanding is the group continues to be in discussions with the Michigan-based owners of the building. The owners of Checkers had tried to strike a deal for that site but couldn’t come to terms with the owners. I’m not sure what the group of citizens has in mind — whether it is lobbying city commissioners to provide some incentives to make the site more palatable to Checkers or whether it is working to bring in a different grocery store company.
If it is incentives, it will be interesting to see how commissioners choose between the two sites, which in the grand scheme of things are relatively close to each other. I haven’t timed it officially, but via car, the two sites are probably within 60 to 90 seconds of each other. On foot, they are within a few minutes of each other.
• If you use your Tandy 1000 computer or other cutting-edge device to follow my Twitter feed — @clawhorn_ljw — you already know that we reported yesterday evening that the RadioShack store at Sixth and Kasold is slated to soon close.
The RadioShack chain on Thursday filed for bankruptcy protection, and on Monday a list of store closings was presented to the court. The store at the shopping center at Sixth and Kasold is included on the list, but the store at The Malls shopping center at 23rd and Louisiana is not on the list. But look for changes there as well. National media outlets are reporting that any RadioShack store that isn’t closed will be put up for sale. Some reports say that Sprint will take over about 1,750 of the stores, and the locations will carry Sprint and RadioShack products.
As for the store at Sixth and Kasold, an employee there said she wasn’t authorized to speak to the media. But it looks like going-out-of-business sales soon will start at all the locations that are closing. The company has said discounts will begin at 50 percent off.
The company plans to close about 1,700 stores, in addition to several stores that already have been shuttered. As we previously reported, that included the Lawrence store on south Iowa Street, which closed several weeks ago. The chain had about 4,000 stores.
Soon, the only thing northwest Lawrence residents will be missing to ensure they wake up bright-eyed and bushy-tailed is the crow of a cock.
Already there is enough coffee near Sixth and Wakarusa — think Starbucks, J&S, Big Biscuit, Dillons and others — to make my bladder hop like a rabbit whenever I get within a quarter-mile of the intersection.
But if you need a jolt with a slightly different flavor get ready for a new establishment that will fluff your tail with items such as coconut creme white tea and sweet potato brownies.
The Kansas City-based restaurant t. Loft has reached a deal to open in vacant space at Sixth and Wakarusa. According to a sign in the window, it is moving into the multi-tenant retail building that includes Burgers by Biggs, Alterations by Sarah and several other businesses.
An employee at t. Loft's State Line Road location in Kansas City confirmed the Lawrence project is moving forward, and I've reached out to the pair of Lawrence residents who are leading the effort.
But the restaurant's website gives a good feel for the place. It promotes tea, juice and clean eats. According to its online menu, it has about 50 teas — white, green, black, matcha, iced, caffeine free, wellness-based and tea lattes. The menu includes about 15 juices, including those designed to give a boost to your energy levels, immune systems and mental capabilities. (Remember, this is right near Free State High, so that last one can come in handy. There is a tea called brainberry, and if such a thing was available when I was in school, I would have soaked my head in it daily to avoid listening in Algebra class.)
The food, however, may be as interesting as anything the restaurant has to offer. The menu doesn't give as many details on the food, but it says there is a bakery case filled with gluten-free and preservative-free items. Some that are mentioned include fresh salads, veggie boxes, fruit and cheese boxes, and some outside-the-box items such as sweet potato brownies and something called apple nachos.
It appears this will be t. Loft's third store, although the first one outside the Kansas City metro area. I don't yet have an estimate on when the Lawrence location will open. But a building permit has been issued to begin renovation work. I'll let you know when I hear more.
In other news and notes from around town:
• Plans for a new "farmers market style grocer" near the northeast corner of Sixth and Wakarusa are still moving forward. But, no, we still don't have an official word on who the grocer will be. Certainly, there is much speculation that it will be Sprouts, a grocery chain that has opened in Overland Park and is expanding in the region.
Final development plans for the site recently were filed at City Hall, but those plans did not list the name of the grocery tenant. But they did provide some color renderings of the proposed grocery building, and also of another multi-tenant retail building that will be next to the grocer. Check out the renderings below.
It looks like that in addition to the grocery store, there will be room for at least four other businesses at the site. After years of waiting, the Sixth and Wakarusa area is beginning to pick up steam. Now, we'll see if the numerous out lots that sit vacant around the Wal-Mart store begin attracting tenants.
City set to approve plans for new West Lawrence grocery store; county and school district ask for more than $500k in fee waivers from city
In the future, please pay no mind to the woman at the intersection of Sixth and Wakarusa pushing a filing cabinet on wheels and muttering about 5 cents off yogurt cups. That will be my wife with her grocery coupons, and you really can't blame her for appearing a bit disoriented. If all goes according to plan, many a grocery shopper soon may be overwhelmed with options at that intersection.
City commissioners at their meeting tonight are scheduled to approve a plan that will allow for a new specialty grocery store to be built in the Bauer Farm development at the northeast corner of Sixth and Wakarusa. That will make for the third grocery store at the intersection, joining Dillons and Walmart, which operates a grocery department.
As we reported in February, the plans call for a 27,000 square-foot building that would house a "farmers' market-style" grocer. The development group, which is led by Lawrence businessmen Doug Compton and Mike Treanor, haven't released the identity of the specialty grocer, at the request of the grocer. The best information I have from sources is that it is not a Trader Joe's, which for whatever reason is a store I always get asked when it is coming to Lawrence. The speculation around town is that a chain called Sprouts Farmers Market is the most likely tenant for the spot, but take that for whatever you think it is worth.
But there is some good reason to think Sprouts is on the way. The company has been on an expansion path, and it has opened a store in Overland Park. The company's website describes Sprouts as a "healthy grocery store offering fresh, natural and organic foods." The company was founded in 2002 in Arizona, and now has more than 170 stores in nine states. Again, there is nothing official on this, but we'll see if lips begin to loosen once plans for the project receive City Commission approval.
The project comes to the commission tonight with a positive recommendation from both the planning staff and the planning commission. The grocery store development has been the headline grabber, but there are other interesting elements to the plan. They include:
• The development group wants the master development plan for the area to show a 108-room hotel near the corner of Wakarusa Drive and Overland Drive. When I last talked to a representative of the development group, there was no tenant for such a hotel, but the group wanted to show it on the plan so marketing for such a tenant could begin. I was told developers think the site may have some potential for a hotel as more visitors come to the Rock Chalk Park area.
• A changing of the plans to allow for an 11,623 square-foot retail building that could house several smaller tenants. It would be next to the grocery store development.
• The addition of six multifamily apartment buildings to the plans. The buildings would be on property east of the current Lawrence Community Theatre property.
In total, the changes would allow for 122,000 square feet of retail development at that corner of the intersection, up from a previously approved cap of 72,000 square feet. Retail caps at the intersection have been a contentious issue in the past. Neighbors have opposed some retail development at the intersection because of fears that the area will become overwhelmed with traffic and other issues that come with big-box retailers. The most recent opposition was when the City Commission rejected a plan for Lowe's to locate in Bauer Farm. There have been some letters of opposition related to this current proposal, but thus far the amount of opposition has not approached what was seen with the Lowe's development, or the Walmart development before that.
On the apartment side of things, the proposed changes would allow for 342 dwelling units on the property, up from a previously approved cap of 272.
A change that is tougher to quantify is how the overall feel of the Bauer Farms development will change. The project was originally touted as an example new urbanism, a development philosophy that really mixes residential and commercial uses and promotes pedestrian activity and other features that you would be more likely to see in an urban, rather than suburban, environment.
The development as it has been built does have a mix of uses, and it does have a bit of a different look than traditional developments. For example, many of the commercial buildings are closer to the street and often have their parking more out of view from the main thoroughfare. But the planning staff's recent report notes that these proposed changes move the project closer to a "more conventional retail development form."
The Bauer Farm development in its beginning years certainly had to deal with a national economic downturn that caused a lot of plans to be changed. But I think it also is fair to say that the project has created the question of how large of an appetite Lawrence currently has for new urbanism development.
The city several years ago spent a lot of time, and some money, exploring the idea of new urbanism and traditional neighborhood designs. It will be interesting to see if community leaders continue to push for that type of development in the future.
In other news and notes from around town:
• City commissioners will have an interesting decision to make tonight that will affect two of its fellow local governments: Douglas County and the Lawrence school district.
Both governments are asking the city to waive some fees that are charged as part of development projects. City staff members are recommending against the fee waivers.
Douglas County is building a new public works facility on East 25th Street near the Douglas County Jail. As part of the project, the county is asking for a waiver of an approximately $265,000 sewer and water system development charge, or more commonly known as an impact fee. The city has been charging such fees since 1996, when new projects hook onto the sewer and water system. It is designed to help the city keep up with expanding water and sewer plants and other big-ticket items that are necessitated by a growing number of users.
The school district is asking for a waiver of about $280,000 in building permit fees associated with a variety of expansion and remodeling projects related to the $92.5 million school bond issue.
City Manager David Corliss is recommending that the fee waivers be denied. The general argument is that even though these are public projects, they still will be creating costs for the city. In the case of the public works facility, the city says it is another connection point on the city's system, and thus must be accounted for in future capital improvement planning. As for the school district project, the city will be sending building inspectors to the construction sites, and there is a cost to do that.
The school district issue, however, has an interesting twist. School district officials note that Kansas University isn't required to even go through the city's building inspection process. The school district believes it has found a lawsuit that says it is not required to go through the city's full building inspection process either, although it says it does want to do so. The city, however, doesn't agree with that legal analysis. Regardless, the school district says it wants to spend as much of the $92.5 million in bond money on children as possible.
"Like KU, USD 497 is an educational institution seeking to spend public monies to educate kids," Superintendent Rick Doll wrote in a letter to the city.
Although neither party mentioned it, it does seem the matter has been complicated by another decision by the City Commission. The commission last year agreed to rebate a whole host of building permit fees and other fees as part of the Rock Chalk Park project. The city was under no obligation to do so, but decided to offer the rebate as part of an "economic development grant" to the project. That grant was in addition to the city ultimately agreeing to pay for the vast majority of all the infrastructure needed to serve the privately owned softball, soccer and track and field facilities that will be leased by KU. I suppose the school district could make an argument that $92.5 million worth of improvements to the education system in the city will have a positive impact on economic development, and thus is worthy of a similar grant. We'll see how it goes tonight, and whether any of the three governments leave City Hall with hard feelings.
Commissioners meet at 6:35 p.m. today at City Hall.