Published July 24th, 2023 at 11:30 AM2 minute read
By Kevin Collison
Lux Living’s big apartment and hotel proposal at 14th and Wyandotte now has a price tag and public ask.
The 27-story tower would cost an estimate $194.5 million and is seeking a $34.1 million tax incentive package. It includes asking for a 20-year property tax reduction, according to documents filed with a city development agency.
The plan calls for 300 apartments and 200 hotel rooms in a tower that would go up on a parking lot and debris-ridden empty parcel next to the historic Power & Light Building. The development plan already has been approved by the City Council.
It would be the first high-rise development built by Lux Living. The St. Louis apartment developer currently is building two projects locally, the 215-unit Wonderland project at 19th and Broadway, and the 192-unit Katz project at Westport Road and Main.
Lux has formed an entity called Monte Rosa LLC to pursue the deal.
The proposal would rival the nearby Cordish high-rise apartment projects, One, Two and Three Light, in rents and amenities, according to a third-party analysis prepared by S.B. Friedman for the Kansas City Economic Development Corp.
The Cordish projects also received substantial property tax abatements as well as direct city cash to build their garages including $17 million for the Three Light garage.
A studio apartment in the proposed Lux development would go for $1,620 per month; one-bedroom, $1,969 and two-bedroom, $2,851. Monthly parking in the 358-space garage would cost an additional $100 per space.
Because the plan is seeking city tax incentives, it would set aside 20 percent of its apartments–60 studio units–for households earning 60 percent of area median income. They would rent for $965.
The incentive package request would allow the developer to keep the 2 percent food and beverage sales tax; 10 percent utility tax and .5 percent of the city earnings tax of employees. It also would allow Lux to collect an additional one percent sales tax.
The 20-year property tax abatement, 80 percent for 10 years and 50 percent for 10 years, would reduce the project’s property taxes by $17.3 million over 25 years. It would still yield $19 million in new revenues to taxing jurisdictions including schools and libraries.
The S.B. Friedman “but-for” analysis supports the need for incentives to make the project economically viable, however it recommended an alternative 15-year property tax abatement, 10 years at 75 percent and five years at 50 percent.
That reduced abatement would save the developer $13 million in property taxes over 25 years and yield $23.3 million to taxing jurisdictions. The other components of the incentive package would remain unchanged.
The S.B. Friedman report stated the developer was in preliminary negotiations with potential private lenders for the project.
Victor Alston, the top executive at Lux Living, was unavailable for comment.
The hotel brand was described as being new to the market and unlike other existing hotels, according to the EDC application.
The project amenities include a rooftop patio and pool, shared recreation spaces, co- working space, a spa/sauna, and a residential lounge, according to the S.B. Friedman report.
“These amenities will be available to residential tenants only; however, the Developer indicated that shared amenities between the hotel and apartment components could be considered in the future,” the report stated.
The hotel component will contain restaurant/retail space on the ground floor.
If the Monte Rosa proposal receives the necessary public approvals, construction would begin next year with completion anticipated in 2027.