Cape council approves first portion of West Park Mall redevelopment; questions regarding incentives package begin before body

Cape Girardeau City Council members approved a small portion of a plan to redevelop West Park Mall at their Wednesday, July 5, meeting, but the group is only beginning to consider portions of the plan that could potentially involve tens of millions of dollars in incentives.

Council members approved the record plat of River City Center First Subdivision, the 65-acre site that includes the mall, parking lots, egress channels and other parcels contiguous to the property. The plat rezones portions of the site.

The group took no action on a recent recommendation from the city's TIF (tax increment financing) Commission to approve the project for up to about $18 million in TIF revenue over 23 years. The recommendation was not on the council's agenda for Wednesday's meeting.

In addition to the TIF incentive, developers River City Centre LLC have asked for other incentives, including waiver of city fees ($100,000), waiver of sales taxes on construction materials ($3 million) and other tax incentives that could total up to about $49 million of the project's estimated $107 million cost.

TIF allows developers to retain 50% of increased property and sales tax revenue up to a capped amount, with the local taxing units receiving the other 50%, plus all of the predetermined baseline tax revenue. Once the TIF period ends or the maximum approved amount is reached, the tax units receive all of the tax revenue.

River City Centre is a group of local real estate developers and strategic partners. The group is owned and managed by Lucas Haley, Michael Williams and Ben Ressel, with additional investment from Matthew Mills, Natalie Riley and Steve Holden, through trusts and affiliates. Combined, they have developed assets across 37 states with a portfolio that includes big box retail, grocery-anchored retail, triple-net retail, multifamily properties, hotels, health care, agriculture, renewable energy and historic rehabilitation. The group has extensive experience in large-scale developments and public-private partnerships, and are active investors in several early-stage companies, including multiple businesses based in Southeast Missouri.

During Wednesday's meeting, Mayor Stacy Kinder told the audience that council members and city staff will consider the proposal and pledged to ensure a thorough vetting process. She noted "misinformation" about the project and encouraged the city's residents to ask questions and seek out correct information from city officials and the developers.

Assistant city manager Trevor Pulley said he anticipates city staff bringing the redevelopment plan to council members in late August, after negotiations between the developers and city staff. He characterized approving the project as a TIF project would serve as a hedge against local taxing districts losing further tax revenue as the mall property continues to decline. He pointed to other TIF projects in the city as revitalizing their surrounding areas.

"There is a lot of engagement with the developers and their attorneys and ours to go forward with the agreements and see what needs to get done," he said. "'Is this a redevelopment of the area a good project for the city?' The TIF Commission answered 'yes'."

Several people pre-registered to comment at the meeting and questioned the project's incentives package.

Dan Drury, president of Midamerica Hotels Corp., contended the TIF portion of the project should not extend beyond the existing structure.

"My big thing in this West Park Mall proposal is the 'blighted area'," he said. "If it includes the parking lot, then I think we can drive all around Cape Girardeau and find blighted parking lots."

He also questioned the request to waive sales taxes on construction material, saying Midamerica is constructing a $12 million hotel near Center Junction but had not asked for such a waiver.

Kevin Whitfield, president of Drury Southwest, also challenged the "big ask" of the incentives package.

"Your responsibility to the citizens of Cape would be to ask for a third-party independent economic feasibility and cannibalization study," he said, referring to the concept of new retail development "cannibalizing" existing sales. "If a project requires 150% subsidy to be successful, it is probably not going to be."

Other business

In new business, council members read for the first time an ordinance and held a public hearing to change zoning at 1201, 1207, 1211, 1215 and 1217 S. Kingshighway from M-2 (heavy manufacturing/industrial district) to M-1 (light manufacturing/industrial district). They also read for the first time an ordinance to approve the record plat of Hawthorne Place Subdivision.

Council members approved several measures on the group's consent agenda. These items had been discussed at a previous council meeting, and the group approved the measures en masse:

• establishing stop signs at various locations;
• establishing no parking zones at various locations;
• amending city code regarding off-street parking regulations;
• accepting a general warranty deed from Broadview Commercial Properties LLC for property at the northwest corner of North Broadview and Independence streets;
• authorizing the mayor to execute a special warranty deed and permanent sign easement to Broadview Commercial Properties LLC for property west of and adjacent to 39 and 45 N. Broadview St.;
• accepting permanent utility easements from various property owners for a portion of a vacated alley right of way between South Park Avenue and South West End Boulevard;
• accepting a permanent utility easement from Vada Leasing LLC for a vacated part of Hickory Street;
• accepting easements from various property owners for the Sherwood Drive/Hood Drive/Brookwood Drive Drainage Improvements Project;
• resolutions authorizing the city manager to execute an engineering services agreement with Bowen Engineering and Surveying Inc. for pedestrian improvements, a performance guarantee agreement with A.G. Jones Properties LLC for public sidewalk improvements in Hawthorne Place Subdivision and SEMO Land LLC for public sidewalk improvements in Forest Hills Estates Fifth Addition and an agreement with Lappe Cement Finishing for pedestrian walkway and intersection improvements.