The developer behind a proposed apartment complex in the heart of downtown Mission is asking the city for a tax abatement, suggesting the project may not be able to move forward without the incentives.
At a city council committee meeting last week, the lead developer of the 58 Nall project, a 77-unit complex at 58th Street and Nall Avenue just off Johnson Drive, floated the idea of a 10-year tax abatement, an unexpected twist nine months after preliminary plans for the project were approved.
The developer said the abatement is now necessary to move forward with the project, and they’re willing to work on affordability and sustainability requests the council may see fit in exchange for the tax breaks.
But councilmembers expressed mixed feelings as they try to balance a desire to bring more foot traffic to downtown Mission versus setting a precedent for other housing projects, of which there are several currently in the works.
Developer originally did not request incentives
- John Moffitt of Overland Park-based Moffitt and Associates said the tax abatement request comes as the U.S.’s prime interest rate has more than doubled in the last year from 3.25% to 7.75%.
- No formal abatement proposal was presented at last week’s committee meeting, but when pressed by the council, Moffitt said they were prepared to request a 100% abatement the the first four years, a 75% abatement for the next four years and a 50% abatement the final two years.
- That means, if approved, Moffitt would not have to pay any property taxes on the 58 Nall project for its first four years, and then would pay just 25% of its tax liability the next four years and 50% the two years after that.
- “We’re kind of at a big crossroads right now,” Moffitt said. “We don’t want to stall this thing out, but we won’t have a choice.”
Moffitt argued 58 Nall will benefit downtown
- Moffitt said his company believes the benefit of the 58 Nall project to local businesses outweighs tax abatement request.
- Councilmember Ben Chociej said he believes more density near downtown Mission would positively impact the businesses lining Johnson Drive.
- “I like the idea of having more people around to spend money in our business corridor,” Chociej said.
- Others like Councilmember Hillary Thomas said she was also open to the idea of a tax abatement.
Councilmembers worried deal could set precdent
- Councilmember Debbie Kring said she’s concerned that striking a tax abatement deal for 58 Nall could lead such incentives to be requested by developers for several other housing complexes also in the works.
- Kring has been a vocal critic of the number of apartment proposals in Mission, several of which have already received at least preliminary approval.
- “I think this is a real slippery slope,” Kring said. “That’s a concern to me.”
- Councilmember Ken Davis also said he shared Kring’s concerns and is reluctant to move forward unless he sees some value to the city.
Other apartment projects plan to ask for incentives
- City Administrator Laura Smith said some, like Milhaus, a concept for apartments near Sylvester Powell Jr. Community Center, also plan to ask for their own tax abatements.
- The Block Real Estate Services’ 330-unit project at the former JC Penney call center at 5665 Foxridge Drive is also interested in asking for some type of incentive, Smith confirmed.
- Other projects like Mission Gateway and the Mission Bowl redevelopment are receiving tax increment financing incentives but not tax abatements.
No final decisions have been made
- Smith told the Post that Moffitt will make a formal request for a tax abatement soon.
- That request will go first to the city’s finance and administration committee for consideration.
- If that committee approves the request, then it would move forward to the city council for final approval.
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