photo by: Chad Lawhorn/Journal-World

The former Riverfront Mall building, right, and Lawrence City Hall are pictured on Oct. 11, 2024.

They’re neighbors, but relations aren’t too neighborly at the moment. The reasons for that are varied but include the fact that one of them may leave the neighborhood.

I’m talking about Lawrence City Hall and the former Riverfront Mall property, which is just to the east of City Hall and currently houses a Marriott hotel, the city’s municipal court and the city’s planning and development services offices.

City officials, as you’ve likely heard, are considering moving City Hall from its longtime home near Sixth and Massachusetts streets in downtown Lawrence. City commissioners at their Tuesday evening meeting will consider moving forward with a contract to buy the former Sallie Mae financial services building near Sixth and Iowa streets to house City Hall.

The potential move has been criticized by some as an abandonment of downtown, which city planning documents have long identified as a special place for community building. However, the city manager’s office has argued the move is needed because the amount of work needed to bring the current City Hall up to modern standards is great — about $12 million worth — and it still would not provide enough space for the city’s needs.

As for why to move out of downtown, the city manager’s office says city-hired consultants determined the costs to renovate the former Sallie Mae building at 2000 Bluffs Drive would be cheaper than the other options. Architects with Lawrence-based Multistudio estimated that it would cost $181 per square foot to renovate the Sallie Mae building, $256 per square foot to renovate the existing City Hall, and $261 per square foot to renovate the former Riverfront Mall. Building something new in downtown likely would cost $25 million to $30 million.

“By comparison, 2000 Bluffs Drive provides the greatest value at the lowest cost,” a memo to city commissioners for their Tuesday meeting says.

That statement would not be universally agreed to at the neighborhood picnic.

photo by: Chad Lawhorn/Journal-World

The former Riverfront Mall complex near Sixth and New Hampshire streets is pictured on Oct. 11, 2024.

The owners of the former Riverfront Mall contend the city is making a serious calculation error — both in terms of financial costs and opportunity costs.

The financial costs involve a multimillion-dollar lawsuit that the owners of the Riverfront Mall property have filed against the city. It alleges the city and its contractors caused millions of dollars in damage to the Riverfront Mall property when construction crews altered the bank of the Kansas River as part of a project to repair the nearby Bowersock Dam.

The financial cost that city officials aren’t adequately considering, Riverfront officials say, is that the city will lose the lawsuit, and be ordered to pay millions of dollars in damages.

But how, you ask, does that have anything to do with the City Hall issue? Because Riverfront officials want to enter into settlement negotiations with the city that would end the lawsuit by selling the Riverfront building to the city. Riverfront officials contend the deal should be attractive to the city because they could likely raze the eastern third of the building — where the foundation damage is severe — and still have enough space in the remaining two-thirds of the building to comfortably house a new City Hall.

Plus, if the eastern third of the Riverfront building is demolished there are new opportunities to connect downtown with the Kansas River. Currently, the building serves as a de facto wall between the river and downtown. The extra space could be useful for long-talked-about projects like a pedestrian river bridge, a fishing dock, a kayak station, and might be a key connection point for a pedestrian/biking loop that is being built around the city.

But officials in the city manager’s office have shown no interest in having discussions, said Chad Battison, a financial adviser and spokesman for Riverfront LLC, the Lawrence-based entity that is a part owner of the Riverfront mall property.

“We have been barred from having any dialogue,” Battison said, saying the city refuses to talk due to the lawsuit.

Battison said the city is not adequately calculating its risks related to the lawsuit, nor recognizing the possibilities of a downtown river connection if the city owned the building. Battison said he is now concerned that city commissioners have not been fully briefed by city officials regarding Riverfront’s request for mediation to resolve the lawsuit by selling the property. Battison is further worried that time is running out. If the city approves a contract to purchase the Sallie Mae building on Tuesday, the opportunity to use Riverfront as a new City Hall site seemingly is done.

photo by: Chad Lawhorn/Journal-World

Lawrence City Hall is pictured on Oct. 11, 2024.

A spokeswoman for the city declined to say whether city commissioners have been made fully aware of Riverfront’s mediation offer.

“We cannot go into the communications our attorneys had with their clients concerning the litigation,” city spokeswoman Cori Wallace said via email.

However, the city did have quite a lot to say about the idea that Riverfront could be some magic bullet to keep City Hall in downtown. In short, city officials highly doubt it.

First, the city is urging the public to be skeptical about how much legal liability the city is really facing from this lawsuit. There are insurance companies involved in the matter. For example, insurance firms associated with the private contractors currently are paying for the city’s legal fees in the matter, not city taxpayers. Plus, the city thinks it has a good case to win the lawsuit.

Of course, no party publicly comes out and says it thinks it is going to lose a lawsuit. How strong the city’s case is versus how strong the plaintiff’s case is is not clear to a layman like me. Not surprisingly, the plaintiffs insist they have a strong case, and have several items to point to.

One is that they contend parts of the building have shifted so much due to the unstable river bank that more than 10% of the rooms at the Marriott hotel cannot be used due to cracked floors, walls and other damage.

Dan Simons, an owner and manager of Riverfront LLC, says you can roll a basketball down the hallways in portions of the building and watch it roll off toward the river, something that wasn’t the case before the work on the riverbank. (Full disclosure: The Simons family is the former owner of the Journal-World. However, the Simons family no longer has any ownership interest in the Journal-World, and the Journal-World has no ownership interest in the Riverfront property or other business dealings with the family.)

There’s another reason city officials aren’t pushing for a Riverfront deal: They know the building, and they are not impressed. The city leases spaces for its planning department and municipal court from Riverfront LLC. This week, city officials were blunt about their views on the condition of the building.

“There are multiple unaddressed issues with the spaces in the Riverfront property leased by the city,” City Manager Craig Owens told the Journal-World via email. “We’ve been begging for a response to our clear requests for service to the building. We have asked them repeatedly to perform basic maintenance on the building that has been in disrepair for many months. Portions of the building have become unusable due to disrepair as a result of years of deferred maintenance. That has been frustrating to both our team members who work in those spaces and for members of the public who have business in our offices. We have been attempting resolution for months.”

Issues have involved HVAC problems that have left the space inadequately heated or cooled, roof leaks, and a ceiling tile falling on a staff member, among others. At times, conditions have been bad enough that some planning staff members have had to work remotely, the city said in its statement.

If anything, the city would like to end its lease early with Riverfront, rather than purchase the building.

“We have communicated the need to depart this building in order to improve the quality of the working life of our team and ensure a quality experience for members of the community,” Wallace said in the city’s statement.

Simons acknowledged there have been some delays in getting items repaired within the city’s space in the building. He said that was due to problems related to a third-party property manager. He said those issues are being resolved, but he disagrees with any concerns the city has about the viability of the building moving forward.

“The building has great potential for the city,” Simons said. “It is not a derelict building. It has some air conditioning issues that we are addressing, and it has a roof issue that we are fixing now.”

For example, Simons said he’s authorized $18,000 worth of repairs to fix the roof. “So, in totality, $18,000 worth of repair is minuscule to the opportunities to rethink this downtown space.”

Of course, any deal would involve a multitude of other costs. Costs are among the details that remain murky about any possible deal. What would be the sale price of the property to the city? Would the Marriott hotel be willing to discontinue its operations, which would be a requirement under any such plan? On the last point, Simons said the hotel operators are open to that idea. My attempt to reach a principal of the hotel company for comment was unsuccessful this week.

Battison said clearly there would be much to negotiate between the city and the Riverfront parties. But Battison said his point is that the city seems poised to make a generational decision for downtown Lawrence without having the discussion.

“How (does) the potential of achieving all of these objectives not warrant honest, good-faith exploration and discussions?” he asked.

City officials note they have been evaluating alternative City Hall locations since March 2023, when they hired Multistudio to begin reviewing sites, including Riverfront. They also note the city has considered purchasing the Riverfront property several times over the years.

“City purchase of the building has been unattractive for numerous reasons, including the likely cost of purchase and the ongoing declining state of the property,” Wallace said in the city’s statement.

Clearly, there’s a neighborhood disagreement — in a neighborhood on the verge of its biggest change in years.

photo by: Chad Lawhorn

The former Riverfront Mall building, which includes the SpringHill Suites by Marriott hotel, is pictured on Oct. 11, 2024.