Historic Scarritt and Crossroads Projects Seek Incentives from Port KC

By Kevin Collison

Two proposed downtown apartment developments totaling 234 units–one old, one new–are seeking tax incentives from Port KC.

A development entity called Axis KC LLC is applying for a $47 million bond to help finance the redevelopment of the historic Scarritt office tower at 818 Grand and its adjoining Arcade into 126 apartments and 25,000 square-feet of ground level commercial space.

A plan to redevelop the Scarritt as a 193-room hotel originally was approved three years ago by a city development agency. In December 2020, the Augustine Development Group of Florida revised the plan to apartments and commercial space including a grocery store.

The Scarritt complex was designed by Root & Siemens and is considered the finest example in Kansas City of the Chicago School architectural style championed by Louis Sullivan. Its exterior features richly decorated terra cotta ornamentation.

The 11-story office tower and the adjoining four-level Arcade, which has its entrance at 819 Walnut, were completed in 1907 and currently are mostly vacant. The building has been broken into and stripped of valuable metals, according to Port KC.

The ornate entrance to the Scarritt Arcade displays the decorate terra cotta that distinguishes the 115 year-old building from its neighbors.

Axis KC is seeking 25-year property tax abatement from Port KC for the project, the first 10 years at 100 percent, the remaining 15 years at 50 percent. The property would continue to pay its current property tax which would then increase in 10 years.

The developer also is applying for a sales tax exemption on construction materials.

The other project seeking tax incentives from Port KC is what’s described as a new 13-story apartment building being pursued by an entity called 1822 Main LLC. Last week, Copaken Brooks confirmed it was behind the proposed development.

The project calls for 10 stories with 108 apartments above a two-story garage, according to the Port KC document. Copaken is seeking a $36 million bond that would be issued by Port KC.

A view of the proposed 1822 Main building looking north. (Rendering by Generator Studio)

The developer is asking for a 25-year property tax abatement for the development site which includes three buildings. The first 10 years would be 90 percent; years 11- through 20, 50 percent, and years 21- through 25, 25 percent.

The current property taxes would continue to be paid as well as the incremental increases. The developer also is seeking a sales tax exemption on construction materials.

Copaken Brooks also is seeking incentives from the city Affordable Housing Trust Fund. City voters approved a $50 million bond last week to increase funding for the program.

The Housing Trust Fund program requires developers to set aside a minimum of 20 percent of a project’s apartments for households earning up to 60 percent of the Area Median Income (AMI).

A table showing the rents projected to be charged for affordable units at the 1822 Main project. (Chart from Port KC presentation)

The 1822 Main project plans to set aside 10 percent its apartments for households earning up to 50 percent of Area Median Income and 10 percent would be reserved for those making up to 60 percent AMI.

The Metro Kansas City AMI for a one-person household is $67,700 and $77,500 for a two-person household, according to the U.S. Department of Housing and Urban Development.

The 1822 Main project calls for 8, micro units; 24, studios; 68, one bedrooms, and 12, two-bedrooms. The three level garage would have 102 parking spaces.

The developers of both projects are negotiating with the local tax jurisdictions regarding their incentive requests, according to Port KC. No date has been established for when the Port KC Board of Commissioners will consider their applications.