Published January 27th, 2022 at 12:30 PM3 minute read
(Editor’s note: This article about two major developments announced Wednesday in Omaha is being published to inform CityScene readers about what other regional cities are doing to revitalize their greater downtowns.
The last office tower built in downtown Kansas City was the 18-story H&R Block headquarters in 2006. The 30-story 1201 Walnut building opened in 1991.
Union Pacific completed its 19-story headquarters in downtown Omaha in 2004 and First National Bank of Nebraska opened its 45-story headquarters in 2002. It’s 10 feet higher than One Kansas City Place, KC’s tallest building.)
Article courtesy of the Nebraska Examiner
BY: AARON SANDERFORD AND CINDY GONZALEZ
OMAHA — A long-discussed streetcar, free to ride and running three miles from 10th Street to midtown, was the key to Mutual of Omaha’s decision to build a skyscraper on the property that houses the city’s main library.
Omaha Mayor Jean Stothert and Mutual CEO James Blackledge announced both new projects Wednesday. Mutual’s plan will change the city’s skyline with a glass high-rise that could rival the tallest in Nebraska, the First National Tower.
“It is very clear to all of us, and every developer, that parking has choked development downtown,” the mayor said. “This (the streetcar) is the solution.”
The city and developers expect the streetcar to reduce traffic along the route. The city plans to raise $306 million for the project. The streetcar is projected to cost $225 million, but another 35% of that would be set aside for a federally required contingency fund.
Blackledge said Stothert’s willingness to invest in a streetcar that runs through midtown — where Mutual has had its headquarters since 1939 — drove Mutual’s decision to leave for the downtown library site.
Mutual has developed a $365 million Midtown Crossing residential and retail campus near its current headquarters. It also has been acquiring more property to the east.
The streetcar would ensure that midtown continues to grow and be redeveloped, Blackledge said, even after Mutual moves downtown with its 4,000 local employees.
Mutual already has sold some of its Midtown Crossing properties, including a hotel and some apartments, and he expects to start selling other pieces soon.
The Mutual headquarters deal calls for the city to swap its library property at 14th and Farnam Streets with Lanoha Development for the land Lanoha owns northwest of 14th and Dodge Streets. That’s the former headquarters site of Union Pacific. Each property covers a full city block.
Mutual had considered the Lanoha land before turning to the library property. City officials said extending the streetcar line to the Lanoha property would have added too much cost.
Stothert and other city officials declined to discuss any future plans for the Lanoha property.
Assuming the City Council approves the plan to move the library. The current library building would be demolished this year. The city expects to relocate the library to 1401 Jones St.
Mutual’s CEO said he hopes to start construction in 2023 and open the new headquarters in 2026. He said its design and cost are still being hammered out.
The structure will hold more than 2,000 parking stalls on its lower floors. Stothert said the city will pay for the parking levels.
Stothert said the streetcar would cost $6.4 million annually to operate, funded by the city’s parking garages and parking meters.
The initial route would stretch from 10th to 42nd Streets along Farnam Street, and from 10th to 31st Streets along Harney Street. There will also be a stop at CHI Health Center Omaha.
Once that is built, the city would “look at plans immediately to expand it north and south,” she said.
The city would cover the upfront costs for streetcar construction with development bonds and private funds. It would then use tax-increment financing, or TIF, to pay off the bonds.
Under TIF, the property taxes generated by new development goes to pay off eligible development costs over a period of up to 20 years.
Stothert said city sales taxes and residential property taxes would not increase. However, commercial property owners along the route would pay higher property taxes under a new TIF district that would be created.
The city expects the TIF to generate $354 million over a 20-year period. Any leftover funds would be directed to projects that could include affordable housing and street conversions that would help develop nearby properties. It also might add additional connections for the streetcar.
Stothert said city and business leaders have been discussing a streetcar since at least 2009.
“Why now?” she asked.
She cited bookend development projects: the $400 million tri-park and science museum development near the Missouri riverfront, and midtown Omaha development anchored by the University of Nebraska Medical Center and Midtown Crossing campuses.
“You can see how the streetcar is going to connect everything together.”