The years-long history of setbacks at Mission Gateway continued this month after a New York bank filed to foreclose on the developer’s mortgage.
Metropolitan Commercial Bank filed a lawsuit for foreclosure on April 18 against Aryeh Realty LLC, a subsidiary of Mission Gateway’s owner, the New York-based Cameron Group, alleging the developers have repeatedly failed to make payments on a $26 million loan agreement.
This comes three months after the city council approved a redevelopment agreement for a $268 million project at Mission Gateway, the fifth and latest iteration of a plan for the site.
Much remains up in the air about the future of the long-stalled development. Here’s the Post’s attempt to start answering some key questions:
What does the foreclosure suit mean for the future of Mission Gateway?
- It is too early to know how this may impact the overall project, city officials say, but in a statement earlier this week, Mayor Sollie Flora said they were “monitoring” Met Bank’s lawsuit, to which the city is not a party.
- Developer Matt Valenti of Cameron Group, LLC, told the Post via email on Tuesday they plan to continue to work with all stakeholders “and look forward to delivering a completed Mission Gateway project.”
- An official with Cinergy Entertainment, a Texas-based company that is slated to run a 90,00-square-foot entertainment complex at the heart of Mission Gateway, told the Kansas City Star they were “very disappointed that the project has hit another snag” but that they “would love nothing more than [to be] able to open a state-of-the-art cinema entertainment center in Mission.”
Is the city on the hook for anything related to Mission Gateway?
- City officials say no, and a press release the city sent out Monday reiterated that the developers have not received any incentives to date on the project.
- The redevelopment agreement approved in January shows the city will commit to issuing $18 to $22.5 million worth of special obligation tax increment financing bonds for the project, but those bonds would only be issued once the city felt certain that developers’ private financing for the project is secure.
- If the city does ultimately issue bonds, the redevelopment agreement approved in January would require construction to begin on the site again within four months of the bonds being issued.
Are there other lenders for the project?
- Bruce Kimmel of Ehlers, Inc., the city’s financial advisor, told the city council in January that Bank OZK and BGO were the construction and mezzanine lenders for the project, respectively.
- At that time, Kimmel shared the capital funding stack, or the way developers plan to pay for the project, which showed $60 million from Bank OZK and $40 million from BGO were lined up for phase one of the project, which includes the residential, retail and Cinergy entertainment complex portions of the project.
- Met Bank’s lawsuit says Aryeh first entered into a loan agreement for $20 million — later upped to $26 million — in 2019, though Met Bank was not mentioned as one of the developer’s lenders during the January city council meeting.
- Councilmember Hillary Thomas cast the lone dissenting vote against the redevelopment agreement in January, saying, “I don’t believe this project is the right fit for the entrance to our city and therefore I do not find it incentive worthy. Additionally, I am concerned about the lack of a funding plan for phase two and incomplete financing for phase one.”
Does the developer owe any taxes, fees or assessments?
- City officials say Aryeh does not owe the city any money, fees or payments.
- County records do show more than $440,000 in property taxes are owed on the six lots that make up the Mission Gateway property.
What about the structures that have been built already?
- Valenti told the council in January that structural engineers evaluated all existing structures in May 2022 and found “nothing earth shattering.”
- The structures would have to be reevaluated before a building permit could be issued in order to restart construction, he said at that time.
- “Months have gone by, weather has happened, so they’re going to be re-evaluated,” Valenti told the council in January.
- For now, the site remains inactive and vacant with an imposing white concrete building that is meant to be the entertainment complex, as well as a partially built parking structure and some concrete pilings.
Go deeper: As Mission Gateway delays continue, here’s a timeline of how we got here
