Menards to anchor retail project

4/7/2012

By SHAJIA AHMAD

By SHAJIA AHMAD

sahmad@gctelegram.com

Local officials have announced that Menards will be the anchor store that is part of a $67.2 million shopping complex proposed by out-of-town developers.

The home improvement company, well known throughout the Midwest where most all of the company's few hundred stores are located, has submitted design plans to city planners for a 162,000-square-foot store in Garden City, city officials announced Friday.

The move by the mega-store is part of a proposed shopping center in the east part of town.

The shopping expanse, broken down by the developer into two phases, is planned to include 400,000 square-feet of retail space at a location just north of Schulman Avenue and south of Sam's Club, east of the U.S. Highway 50/83 bypass on about 61 acres of privately-owned land.

City officials, who have been working with a Charlotte, N.C.-based real estate business, Collett & Associates, on the project for about a year, said the move in the first phase of the project marks another concrete step for the project.

"It's a great day to be a Garden Citian," Mayor John Doll said Friday. "I'm excited for the staff, for the highs and lows we've gone through. ... To see it come to this point is very exciting."

Representatives from Collett have said their plans for the development process is to open Menards, the largest of the stores in the retail center, by next spring. They also are hopeful street work and other improvements will begin as early as this summer.

A representative from Collett & Associates could not be reached for comment Friday.

According to Garden City Manager Matt Allen, the timeline for both the developer and retailer are "aggressive."

"But there are some real advantages to Menards being the first store to open, and much sooner than we expected, for the new regional shopping center," Allen said. "They are projected to be much larger than all the prospective storefronts or out-lots and be the largest sales tax generator, both of which will help pay off the bonds that will be issued to develop this district."

Representatives from Collett & Associates have said that they identified Garden City as a market because of its retail regional pull: Outside the community of about 30,000, the developers are hopeful they'll pull between 175,000 to 200,000 customers from this corner of the state, in addition to surrounding states.

The first phase of Collett's proposal includes development and construction of Menards by spring 2013; four outlots for retail that remain undisclosed or undetermined; parking and related infrastructure; and necessary highway, street and infrastructure improvements.

One of the many next steps in the development process includes the city's intent to create a tax-increment financing, or TIF, district at the site of the proposed development as a way to raise money to help with the project's "public contribution."

City commissioners have approved a "memorandum of understanding" with Collett, with the intention of helping secure financing for the developer's first phase.

City officials are hoping to cover the project's public contribution — estimated at nearly $17.8 million for both phases, including nearly $5.3 million for the project's first phase — by creating the TIF district that would hold the property tax liability at its current appraised value for the next 20 years.

The popular financing mechanism is used to subsidize infrastructure and other community-improvement projects across the nation.

Creating such a district would allow the city to issue bonds to raise money for the retail project, using the future revenue stream — foregone property taxes — as a debt repayment tool.

The property taxes still are paid by all the new property owners, but the tax increment is devoted to paying the debt service on the bonds issued.

"In terms of getting the financial performance of the proposed (TIF) district a boost, this is an ideal scenario," Allen said.

The city will hold a public hearing at 1:30 p.m. April 17 to establish the TIF district, as part of a regular city commission meeting, at which time other taxing entities affected by the district — including Garden City Community College and Finney County — can protest the TIF district's creation.

In anticipation of that, city officials have visited with boards of taxing entities that will be affected.

In addition to property tax TIF-bonds, utility work costs on the site such as water, wastewater and electricity, could total nearly $1.2 million. Some of those costs may be the responsibility of the city and some by stores that purchase or lease property by the developer, city officials have said.

Street work required to make improvements to U.S. Highway 50/83/400, Schulman Avenue and Larue Street to handle the entire retail development also are estimated to cost just more than $4 million.

City officials have applied for funds for those street improvement projects through the Kansas Department of Transportation, in hopes of covering a large portion of those costs.

Allen said other steps in the development process also include necessary zoning changes of the private property and the completion of a developer's agreement between the city and Collett.

Planning and Community Development Director Kaleb Kentner said now that Menards has submitted its site plan to the city, planning officials will review those details, which could take one to two weeks.

The site plan relays exactly how the area will be developed and must be approved by city officials before a building permit can be issued, Kentner said.

"(The land) is being annexed already, and the site already meets the city's comprehensive plan for zoning," Kentner said, adding that property will be reviewed for a zoning change to reflect its commercial use later this month by the all-area Planning Commission.

A family-owned company started in 1960, Menards currently operates more than 260 home improvement stores with locations in Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin and Wyoming.

Menards has four stores in Kansas, including one in Manhattan, Salina, and two in Wichita, according to its website.

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